Former Comverse Technology Inc. (Nasdaq: CMVT) CFO David Kreinberg, who turned state’s evidence in the US case against his former boss, Kobi Alexander, is the executive whom Alexander allegedly tried to bribe.
Kreinberg testified to this effect in the US District Court for the Eastern District of New York (Brooklyn) yesterday as part of a plea bargain in which he pleaded guilty on two counts of security fraud and conspiracy.
He told prosecutors that Alexander offered him $2 million to take full blame for the stock options backdating affair at Comverse. He said Alexander increased the offer to $5 million, and when he again refused, Alexander said, “Name your price.”
The FBI representative in South Africa told the Windhoek Magistrates Court in Namibia in a hearing for Alexander on October 2 that a senior executive had turned state’s evidence.
Alexander’s US attorney, Adv. Robert Morvillo, said in response, “My client denies that offered a bribe to Kreinberg, and he intends to contest the accusations if and when he returns.”
Kreinberg told the court yesterday, “I was asked by the CEO to bring him a printout of the company's trading prices over a past year period to enable him to select the 'as of' date that would be used for the exercise price of the option grant.”
He told the court that the scheme understated Comverse's compensation expenses, thus inflating net income on financial statements that he signed and submitted to the US Securities and Exchange Commission (SEC). He added that he knew his actions were "wrong."
Under the plea bargain, Kreinberg can expect less than the 15-year sentence he could have faced before agreeing to testify. He will be sentenced on February 23, 2007.
Published by Globes [online], Israel business news - www.globes.co.il - on October 25, 2006
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