William F. Sorin, Former General Counsel of Comverse Technology Inc., Pleads Guilty to Securities Fraud Charge
BROOKLYN, NEW YORK - Roslynn R. Mauskopf, United States Attorney for the Eastern District of New York, and Mark J. Mershon, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office, announced today that WILLIAM F. SORIN, former General Counsel of Comverse Technology Inc., waived indictment and pleaded guilty to a one-count felony information charging conspiracy to commit securities fraud, mail fraud, and wire fraud. The plea was entered before United States District Judge Nicholas G. Garaufis at the United States Courthouse in Brooklyn, New York. The charge stems from the stock options backdating scheme at Comverse from 1991 to 2002.
The conspiracy charge carries a maximum sentence of five years' imprisonment and a fine of up to $250,000, or twice the gain or loss from the offense. The charge also requires restitution in an amount to be determined by the Court at sentencing, currently estimated at up to $51 million.
At the guilty plea proceeding this afternoon, SORIN admitted that he conspired with Jacob "Kobi" Alexander, former Chief Executive Officer of Comverse, to conceal that Comverse stock options grants were being backdated to dates when the stock was trading at periodic low points. SORIN also admitted that he approved false proxy statements and SEC filings that failed to properly account for the backdated options as compensation expense.
"Corporate counsel have a special role to fill in ensuring the integrity of U.S. financial markets," stated United States Attorney Mauskopf. "When they fail in that role, they not only do a disservice to their companies' shareholders, they fail as members of the bar." Ms. Mauskopf praised the Federal Bureau of Investigation for its assistance in the case.
Previously, on October 24, 2006, David Kreinberg, former Chief Financial Officer of Comverse, pleaded guilty to a felony information charging one count of securities fraud and one count of conspiracy to commit securities fraud, mail fraud, and wire fraud as a result of his participation in the stock options backdating scheme. On October 11, 2006, Alexander was indicted on 35 charges for his role in the scheme, and is now awaiting extradition proceedings in Windhoek, Namibia.
The government's case is being prosecuted by Assistant U.S. Attorneys Ilene Jaroslaw,
Linda Lacewell, Sean Casey, and Kathleen Nandan.
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