Fugitive in stock-options backdating case found
526301
(InfoWorld) - Law-enforcement officials in Namibia have arrested the former chief executive of Comverse Technology Inc., a fugitive after being charged in August with backdating millions of the company's stock options, the U.S. Department of Justice (DOJ) announced Wednesday. Jacob "Kobi" Alexander was arrested Wednesday on a Namibian warrant issued at the request of the U.S. government. He was one of three former executives at the software vendor charged with conspiracy to commit securities fraud, mail fraud and wire fraud in August in U.S. District Court for the Eastern District of New York. The three, including former Chief Financial Officer David Kreinberg and former General Counsel William F. Sorin, were accused of operating a secret stock options slush fund, with issuing false and misleading financial statements, and with reaping millions of dollars in profits through a scheme to backdate stock options between 1998 and 2002, the DOJ said. The DOJ will seek Alexander's extradition to the U.S. to face multiple charges, many of which were made public Wednesday: conspiracy, two counts of securities fraud, eight counts of making false filings with the Securities and Exchange Commission, four counts of mail fraud, 14 counts of wire fraud, and three counts of money laundering. The indictment also seeks force Alexander to forfeit about US$138 million in assets, the DOJ said. Alexander is scheduled to appear before a court in Windhoek, Namibia, within 48 hours. The effort to find Alexander was an "international manhunt," U.S. Attorney Roslynn Mauskopf of the Eastern District of New York said in a statement. If convicted of the most serious charge, securities fraud, Alexander faces a possible sentence of 25 years in prison. The former Comverse executives were the second group to be charged in connection with options backdating. The U.S. Securities and Exchange Commission has been investigating several tech companies for irregularities in connection with granting employees stock options, a common practice in the IT industry in the late '90s. In July, two former executives with storage networking vendor Brocade Communications Systems Inc. were charged with securities fraud.
544185
Some companies have ousted their CEOs for merely being around during stock option scandals. Those companies weren't led by Steve Jobs.
502281
Options, options, options -- when will the madness end?
430180
Apple Inc  Chief Executive Steve Jobs has been asked by U.S. securities regulators to give a deposition in a stock options backdating lawsuit against the company's former general counsel, Bloomberg reported on Thursday, citing two people familiar with the matter.
253180
Apple said an internal review found that Steven P. Jobs knew the company was backdating stock options to inflate their value.
225897
Irregular hors d'ouevres, scheduling mishaps, and the stockbroker's eternal dilemma.
32583
A new study estimates that the stock options backdating scandal may cost shareholders hundreds of millions of dollars.
365232
The Securities and Exchange Commission approved settlements with Brocade Communications Systems Inc. and Hewlett-Packard Co.'s Mercury Interactive Corp. , the first companies to be fined since the government's crackdown on illegal stock options backdating began more than a year ago.
479924
An investigation of the stock option practices of the arts and crafts retailer was transferred to the Justice DepartmentÂs fraud section.
601626
JOHANNESBURG, South Africa -- The fugitive former CEO of software company Comverse Technology Inc. was granted bail by a Namibian court Tuesday while he awaits extradition to the United States to face charges for allegedly manipulating stock options.
440226
(InfoWorld) - A civil lawsuit accusing Henry Nicholas III, the former president and CEO of Broadcom Corp., of mistreating employees, using illegal drugs and paying for prostitutes, has reportedly caught the attention of U.S. law enforcement officials investigating stock options backdating at the company. Nicholas, who resigned from Broadcom in January 2003, is the target of a civil lawsuit brought by cousins Kenji and Scott Kato, both former employees of Nicholas. The lawsuit, filed in November in Superior Court of California for the County of Los Angeles, alleges that Nicholas and his lawyers reneged on a settlement for wrongful termination and other claims. The Wall Street Journal reported Friday that the U.S. Attorney's Office for the Central District of California, which is investigating stock options backdating at Broadcom, has begun looking into the Katos' claims. The U.S. Federal Bureau of Investigation interviewed Kenji Kato in April, and this week, it began interviewing other Nicholas employees, the news report said. Kenji Kato's lawyer, Joseph Kar, declined to comment on the U.S. Attorney's interest in the case. A spokeswoman for the U.S. Attorney's office didn't immediately return a phone call seeking comment on the investigation. Broadcom, a chip maker for communications devices, announced in January it would take a $2.24 billion charge for stock options backdating. Broadcom said it found options for 232.9 million shares of company stock that had been backdated, with 9.7 million of those shares going to executive officers. Kenji Kato, who describes himself in court documents as a former personal assistant of Nicholas', said Nicholas and his lawyers offered him a settlement of more than US$2.9 million in November, then withdrew it. Kato had accused Nicholas of wrongful termination, breach of contract and infliction of emotional distress, among other things. Kenji Kato worked for Nicholas from October 1999 to April 2006, and during much of that time, Nicholas threw wild parties and regularly used illegal drugs such as cocaine, according to a court filing from May. While at Broadcom, Nicholas hired prostitutes for clients and for himself, and he spiked customer drinks with powdered ecstasy pills to lower their "inhibitions and guard," Kato said in the filing. Nicholas' lawyer, Steven Silverstein, didn't immediately return a phone call seeking comment on the lawsuit. But in court documents, Nicholas' lawyers deny the allegations and accuse Kato of attempting to extort money from Nicholas. Kato signed a confidentiality agreement when working for Nicholas, according to documents filed by Level 7 LLC and The Management Company LLC, two companies owned by Nicholas. Kato has threatened to make public "certain sensitive private alleged facts ... which he had expressly promised to keep private," the Level 7 court documents say. "Kato's wrongful conduct by issuing these threats ... will cause great and irreparable injury to plaintiffs." Nicholas regularly yelled at employees, and he demanded that Kenji Kato carry a bag with illegal drugs for him, according to Kenji Kato's filing. Nicholas also demanded that Kato use drugs along with him, Kato said. "I was regularly exposed to ... a high degree of debauchery while working for Nick," he said in his filing. "The first time I used cocaine was when Nick shoved a tiny spoon up my nose because I was falling asleep, while he was talking to me. Over time, I got sucked into his extreme lifestyle." By the end of Kato's employment, Nicholas was using "large quantities" of illegal drugs, including cocaine and heroin, and had withdrawn from his friends and family, according to Kato's May filing. Nicholas had stopped paying Kato, although he still demanded work from him, and when Kato walked out, Nicholas owed him $150,000 in back pay, the court documents say. Nicholas had promised Kato employee benefits and Broadcom stock options, but he never delivered, according to Kato's filing.
623053
The practice of manipulating stock options grants to make them more favorable has come back to haunt yet another round of high-tech executives. A former Monster Worldwide Inc. executive is expected to agree to a plea deal in New York Thursday, just a day after the founder of Take-Two Interactive Software Inc. pleaded guilty to a state felony related to backdating.
459037
Federal prosecutors are looking into stock-option backdating at KB Home, but the company said it was not the target of the investigation.
177494
Low-priced stocks can sometimes hold overlooked investment opportunities.
451513
How one soaring stock can rescue you from your bad decisions.
406460
Juniper out of the bush but Berry gets the squeeze Juniper Networks has settled with the US Securities and Exchange Commission (SEC) over allegations of improper stock option backdating. But while the networking equipment maker swims out of hot water, its former legal counsel is getting a double dip in the stew pot.â¦
560738
Hedge funds donÂt investigate options backdating just to satisfy their curiosity. Rather, they do it to find an edge Â and to use that edge to get richer than they already are.