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| By Israel Insider staff and partners October 3, 2006 |
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Jacob "Kobi" Alexander, former chief executive of voicemail-software maker Comverse Technology Inc., was granted bail of $1.3 million by a Namibian court Tuesday after being accused in the United States of a multi-million dollar stock manipulation scheme.
After a two-month manhunt Alexander was arrested Sept. 26 in the Namibian capital Windhoek at the request of the FBI.
He was granted bail of about $1.3 million, his lawyer Richard Metcalfe said, on condition that he hands in his passport, is not allowed to leave the district of Windhoek and has to report twice a week to an Interpol inspector.
"We are extremely pleased," Metcalfe said.
"The decision was a blow to the Namibian government, which had opposed bail on the request of the U.S., arguing Alexander could flee the country before a U.S. extradition request reached Namibian authorities," Haaretz reported.
However, Metcalfe said: "Magistrate Uatjo Uanivi found that the evidence presented for denying him bail were not convincing at all.
According to Ynet News, "Earlier Tuesday, Professor David Libai, former justice minister and current legal council to former Comverse CEO Kobi Alexander, described for the first time Monday night the series of events surrounding his client's stock scandal. Libai detailed his intended defense, in the event that Alexander is extradited."
"Kobi left the US and came to Israel with his family for a summer vacation. There was not a warrant for his arrest at that time and his freedom of movement was not restricted," Libai said.
"Contrary to various publications, Kobi is not an American citizen, only an Israel citizen, and, thus, he has no obligation to return to the United States upon being indicted," the professor explained.
The U.S. has 30 days to lodge an extradition request from the date of Alexander's arrest. Only then will a formal hearing be held. U.S. Attorney Roslynn Mauskopf said last week she would seek Alexander's swift extradition to face charges in federal court in Brooklyn.
Alexander only briefly referred to "the highly technical charges" against him during the first day of his bail hearing Monday and said he intends to plead not guilty.
In his affidavit filed with the court, Alexander, 54, an Israeli citizen, said he had been living in the desert country with his wife and three children since July and had transferred almost $16 million from Israel to Namibian commercial banks.
Having a two-year permit to live and work in Namibia, Alexander has purchased a $500,000 house on the Windhoek Country Club Estate. His children attend the city's international school.
"While in Namibia I have used my own name openly and publicly in all my encounters and ventures with government officials and private individuals alike.
"I entered Namibia openly and lawfully, and I have not in any manner tried to hide my whereabouts from anyone," he said.
According to his statement he has invested a further $1.5 million in various business ventures in Namibia with local partners. He has purchased of a number of properties and plans various low-cost housing developments.
Authorities began hunting for Alexander in late July shortly before a criminal complaint was unsealed accusing him and two other former top executives of fraud.
Before he disappeared, Alexander allegedly transferred $57 million to Israel.
It is alleged that from 1991 through 2005, Alexander exercised options and sold stocks worth approximately $150 million, making a $138 million profit, according to the complaint. Of that, about $6.4 million was generated by backdating options.
Two other defendants, former finance chief David Kreinberg and former senior general counsel William Sorin, surrendered in August and were released on $1 million bond each.
The complaint unsealed in federal court accuses the three men of making stock options more lucrative by backdating their exercise price to a low point in the stock's value. Usually, a stock option's exercise price coincides with the market value at the time of a grant to give the recipient an incentive to drive the price higher.
Prosecutors allege two other defendants Kreinberg and Sorin earned about $1 million each on backdated options.
In addition, the company awarded thousands of stock options to fictional employees, then secretly transferred the awards to an internal account under the name I.M. Fanton, which stood for phantom, court papers said. The scheme allowed Alexander to award those options to real "favored employees" and to himself without board of directors approval, the papers added.
Comverse Technology is headquartered in Woodbury, New York, giving Brooklyn prosecutors jurisdiction over the case.
AP contributed to this article.
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