Kobi breaks his nine-month silence

THE man at the centre of the first extradition request that Namibia has received from the United States of America, Jacob (‘Kobi’) Alexander, yesterday for the first time since his arrest in Windhoek nine months ago broke his silence on the charges that he faces in a US court.

In a statement issued on Alexander’s behalf by the law firm that represents him in Namibia, Metcalfe Legal Practitioners, the first indications were given that Alexander is denying the charges levelled against him in the US and that he intends to put up a strong fight against those charges if he ends up being extradited to the US. The US authorities have asked their Namibian counterparts to extradite the 55-year-old Alexander to the US so that he can be put on trial in a New York court on 35 criminal charges.The charges are related to claims that while Alexander was in charge of a New York-based company, Comverse Technology Inc, he profited to the tune of some US$6,4 million (around N$45 million) through an allegedly illegal stock options backdating scheme.In an indictment that Alexander could face if he returns to the US, he is accused of having changed the dates on which he was given the option to buy shares in Comverse at some point in the future.It is alleged that Alexander backdated his stock options to earlier dates when the shares traded at lower prices on the stock market.These were all part of his pay as Chief Executive officer and board chairman of the company.Through this type of backdating, which is claimed not to have been reported to Comverse’s board of directors and shareholders or to the US Securities and Exchange Commission, Alexander illegally increased the profits that he was to realise when he eventually exercised the stock options, it is alleged.The situation that Alexander finds himself in is one that is shared with more than 2 000 other US companies, who have also been found to have carried out stock options backdating between 1996 and 2005, but is also unusual, considering that Alexander is one of a few executives of US companies to have been singled out for actual prosecution, according to the statement issued by the firm.Alexander, who is a born Israeli, founded the company Comverse Technology Inc in 1982, the firm states.”Over the next 25 years, he built the company into the world’s largest supplier of voicemail systems and related technology used in the telecommunications industry, a company with approximately 6 000 employees.When he resigned as Chairman and Chief Executive Officer of Comverse in May 2006, the Company was highly successful, had a stock market value of approximately US$6 billion and its assets included over US$2 billion in cash,” the firm stated.Comverse is “one of hundreds of companies” that are being investigated by the US government for allegedly backdating stock options, it is said in the statement.”Backdating options is not illegal,” the firm stated.”Rather, the charges relate to the disclosure and accounting treatment of the options.However, Kobi Alexander is neither a lawyer nor an accountant.Like Steve Jobs of Apple Computer, and other CEOs of companies that allegedly issued backdated options but have not been charged with any misconduct, Mr Alexander relied on lawyers and accountants to draft Comverse’s disclosures and to prepare its financial statements.”According to two academics whose work threw a spotlight on the backdating of stock options, more than 2 000 companies in the US have allegedly backdated stock options between 1996 and 2005, the firm stated.”Like all Comverse employees, Kobi Alexander received stock options in connection with his employment,” according to Metcalfe Legal Practitioners.”During his employment, he exercised some of his options and sold Comverse stock at a profit.The vast majority of his gain was due to appreciation of Comverse stock and was unrelated to any alleged backdating.In fact, even the United States Government has conceded that less than 4,3 per cent of his gains resulted from the alleged backdating.”Over the years that he is alleged to have exercised stock options in Comverse, Alexander made a total profit of some US$138 million (about N$1,05 billion), it is alleged.The law firm went on to state that at the time that Alexander and his family travelled from Israel to Namibia in July last year, after they had visited Israel in the northern hemisphere summer of 2006, there were no charges against Alexander: “There was no legal prohibition on his travelling to Namibia.He was not a fugitive, and he and his family entered Namibia lawfully and openly.”At that time, Comverse was already under investigation in connection with the alleged stock options backdating scheme.Alexander was granted a two-year employment permit near the end of August, allowing him and his family to stay in Namibia.Metcalfe Legal Practitioners remained silent on the reasons that prompted Alexander to travel to Namibia and set up residence in the country in the first place.However, at the time that he and his family travelled to Namibia, no extradition agreement existed between Namibia and the US.The US was only designated as a country to which people could be extradited from Namibia under the country’s Extradition Act on September 27 last year.That same day, Alexander was arrested in Windhoek at the request of the US government.He was released on bail of N$10 million on October 2.An extradition hearing that should determine whether Namibia will surrender him to the US authorities still has to be held.A date for that hearing was again not determined when Alexander made his latest appearance in the Windhoek Magistrate’s Court on Monday this week.Alexander has faith in Namibia’s justice system, the lawyers’ statement claimed: “Mr Alexander believes in the fairness of the Namibian justice system.He has not violated any laws in Namibia and remains in the country lawfully and legally.As a resident of Namibia, Mr Alexander has the right to a full and fair extradition hearing.”Under both Namibian and United States law, Mr Alexander is presumed innocent until proven guilty.If he is extradited to the United States, he will plead not guilty and vigorously contest all the charges against him.”Alexander has to appear before a Magistrate in Windhoek again on July 9.The US authorities have asked their Namibian counterparts to extradite the 55-year-old Alexander to the US so that he can be put on trial in a New York court on 35 criminal charges.The charges are related to claims that while Alexander was in charge of a New York-based company, Comverse Technology Inc, he profited to the tune of some US$6,4 million (around N$45 million) through an allegedly illegal stock options backdating scheme.In an indictment that Alexander could face if he returns to the US, he is accused of having changed the dates on which he was given the option to buy shares in Comverse at some point in the future. It is alleged that Alexander backdated his stock options to earlier dates when the shares traded at lower prices on the stock market.These were all part of his pay as Chief Executive officer and board chairman of the company.Through this type of backdating, which is claimed not to have been reported to Comverse’s board of directors and shareholders or to the US Securities and Exchange Commission, Alexander illegally increased the profits that he was to realise when he eventually exercised the stock options, it is alleged.The situation that Alexander finds himself in is one that is shared with more than 2 000 other US companies, who have also been found to have carried out stock options backdating between 1996 and 2005, but is also unusual, considering that Alexander is one of a few executives of US companies to have been singled out for actual prosecution, according to the statement issued by the firm.Alexander, who is a born Israeli, founded the company Comverse Technology Inc in 1982, the firm states.”Over the next 25 years, he built the company into the world’s largest supplier of voicemail systems and related technology used in the telecommunications industry, a company with approximately 6 000
employees.When he resigned as Chairman and Chief Executive Officer of Comverse in May 2006, the Company was highly successful, had a stock market value of approximately US$6 billion and its assets included over US$2 billion in cash,” the firm stated.Comverse is “one of hundreds of companies” that are being investigated by the US government for allegedly backdating stock options, it is said in the statement.”Backdating options is not illegal,” the firm stated.”Rather, the charges relate to the disclosure and accounting treatment of the options.However, Kobi Alexander is neither a lawyer nor an accountant.Like Steve Jobs of Apple Computer, and other CEOs of companies that allegedly issued backdated options but have not been charged with any misconduct, Mr Alexander relied on lawyers and accountants to draft Comverse’s disclosures and to prepare its financial statements.”According to two academics whose work threw a spotlight on the backdating of stock options, more than 2 000 companies in the US have allegedly backdated stock options between 1996 and 2005, the firm stated.”Like all Comverse employees, Kobi Alexander received stock options in connection with his employment,” according to Metcalfe Legal Practitioners.”During his employment, he exercised some of his options and sold Comverse stock at a profit.The vast majority of his gain was due to appreciation of Comverse stock and was unrelated to any alleged backdating.In fact, even the United States Government has conceded that less than 4,3 per cent of his gains resulted from the alleged backdating.”Over the years that he is alleged to have exercised stock options in Comverse, Alexander made a total profit of some US$138 million (about N$1,05 billion), it is alleged.The law firm went on to state that at the time that Alexander and his family travelled from Israel to Namibia in July last year, after they had visited Israel in the northern hemisphere summer of 2006, there were no charges against Alexander: “There was no legal prohibition on his travelling to Namibia.He was not a fugitive, and he and his family entered Namibia lawfully and openly.”At that time, Comverse was already under investigation in connection with the alleged stock options backdating scheme.Alexander was granted a two-year employment permit near the end of August, allowing him and his family to stay in Namibia.Metcalfe Legal Practitioners remained silent on the reasons that prompted Alexander to travel to Namibia and set up residence in the country in the first place.However, at the time that he and his family travelled to Namibia, no extradition agreement existed between Namibia and the US.The US was only designated as a country to which people could be extradited from Namibia under the country’s Extradition Act on September 27 last year.That same day, Alexander was arrested in Windhoek at the request of the US government.He was released on bail of N$10 million on October 2.An extradition hearing that should determine whether Namibia will surrender him to the US authorities still has to be held.A date for that hearing was again not determined when Alexander made his latest appearance in the Windhoek Magistrate’s Court on Monday this week.Alexander has faith in Namibia’s justice system, the lawyers’ statement claimed: “Mr Alexander believes in the fairness of the Namibian justice system.He has not violated any laws in Namibia and remains in the country lawfully and legally.As a resident of Namibia, Mr Alexander has the right to a full and fair extradition hearing.”Under both Namibian and United States law, Mr Alexander is presumed innocent until proven guilty.If he is extradited to the United States, he will plead not guilty and vigorously contest all the charges against him.”Alexander has to appear before a Magistrate in Windhoek again on July 9.