Kobi Alexander
Encyclopedia
Jacob "Kobi" Alexander (born May 4, 1952) is the founder and the former CEO of New York
-based Comverse Technology
. In 2006, he was charged with multiple counts of fraud
and related offenses pertaining to irregularities in trading of Comverse stock; he subsequently fled to Namibia
, a nation which has no extradition treaty with the US.
Alexander founded Comverse Technology (NASDAQ: CMVT) in 1982 and built it up from a 3-person Israeli startup to employing over 5,000, becoming the leading provider of software and systems for telecommunication companies worldwide. Comverse’s success led to its inclusion in the NASDAQ 100 and S&P 500 indices.
, Israel
. His mother was a school teacher, and his father an officer in the signal corps of the Israeli Defense Forces, and later, the Managing Director of the Israeli National Oil Company.
Following military service, Alexander enrolled in the Hebrew University of Jerusalem
, receiving a BA in Economics Magna Cum Laude in 1977. In 1978 he traveled to the United States earning an MBA at New York University
.
In his early years in New York, he met an electrical engineer and together with his brother in law, a professor of Computer Science at Columbia University, the three conceived voice mail technology and developed the idea of what was to become Comverse Technology. The founders understood already then that communications will be a big market, and pioneered the voice mail systems that today are used by telecoms worldwide to support telephony services for the masses.
Upon taking the helm, Alexander made three key strategic decisions:
Within a short amount of time, Comverse was back on its feet. A major breakthrough came when Alexander convinced Swiss telecom giant Ascom to invest US$6 million in the company in the mid eighties, providing Comverse the capital it needed to realize its dream. In 1986, Alexander was able to take Comverse public on the NASDAQ
.
In 1997, Comverse bought its main competitor for US$700 million, at the time the largest acquisition to date for an Israeli based company. Comverse Technology, Inc., which owns 100% of Comverse, also owns majority equity in several other companies, including Verint and Ulticom. It has over US$1.5 billion in sales to over 450 telecoms in 120 countries supporting more than 450 million subscribers worldwide. As of March 2006, the company employed approximately 6000 people in over 50 countries, had a market capitalization of approximately US$6 billion, and over US$2.2 billion in cash.
The Wall Street Transcript, naming Kobi Alexander as the Gold Award Winner in the Computer Telephony industry said: “… an exceptional management team have yielded consistently outstanding revenues, earnings, and shareholder value. Alexander has set some very high standards for this company and this industry.”
In addition to Comverse Technology, Alexander spun off and took public several other companies including Ulticom (NASDAQ: ULCM) and Verint Systems (NASDAQ: VRNT). Companies under his leadership were listed in Barron’s 500, Business Week: “Hot Growth Companies”, “Business Week 50”, Business Week: “The Information Technology 100”, Financial World: “America’s Best 100 Growth Companies”, Fortune: “100 Fastest Growing Companies”', International Business: “100 Fastest-Growing International Companies”, Wall Street Journal: “10-Year Best Performers”, and Wall Street Journal “Honor Roll”, among others. In 2006, Comverse was named one of Institutional Investor: America's Most Shareholder-Friendly Companies". "As CEO of Comverse, Alexander was sought out by the likes of former Chinese President Jiang Zemin
, who slipped away from official meetings in 2000 and steered his motorcade through a pot-holed section of Tel Aviv to meet with him." He served as the Chairman of the Board
and Chief Executive Officer
of CTI from 1987 to May 1, 2006, when he resigned during an investigation being conducted by a Special Committee of CTI's Board of Directors
into the timing of CTI's stock option grants. He was Chairman of several CTI subsidiaries, including Verint and Ulticom.
i citizenship, was charged by United States Department of Justice
authorities with multiple charges of conspiracy
to commit various types of fraud
(including securities fraud
, wire fraud
and mail fraud), as well as with related offences, all relating to the timing of Comverse's stock option grants.
After Alexander left the United States
on June 21, 2006 on a pre-planned annual vacation in Israel, his lawyers arranged with American authorities that he would return to face indictment
on July 30, 2006; however, he instead traveled to Germany
. On July 31 he was added to the FBI's Most Wanted List.
On August 9, 2006 the United States Securities and Exchange Commission
filed a civil injunctive action in the United States District Court for the Eastern District of New York
against Alexander, along with alleged co-conspirators William F. Sorin, Comverse’s former Senior General Counsel, and David Kreinberg, Comverse’s former Chief Financial Officer
. The complaint makes nine claims of violation of the Securities Act and the Exchange Act
, including fraud (First and Second Claims), and falsification of books, records or accounts (Fourth Claim). Through this action, the Commission is seeking permanent injunctive relief, disgorgement of ill-gotten gains, civil damages, and a prohibition against any of the defendants becoming officers of a securities-issuing entity under SEC jurisdiction.
Alexander transferred over 40 million dollars from his personal U.S. bank account to his personal bank account in Israel. He was arrested by Interpol
in Windhoek, Namibia on September 27, 2006. He was released on bail on October 3, 2006. According to a Reuters report of April 23, 2007, the Namibian government described Alexander as “very passionate" about the country and its people; Alexander has promised to boost academic interest in science and technology in Namibia by establishing an annual scholarship for primary and secondary level students. He has also begun to introduce advanced technology to the country with his development of a low budget solar powered housing project for 100 low-income Namibian families.
Despite fighting extradition to the United States, Alexander announced on January 28, 2008 that he has filed suit against Comverse. Alexander claims the firm owes him $72 million in severance, unexercised stock options, and bonus pay.
On July 3, 2008 a Namibian court split decisions for and against Alexander granting his request to remove the judge currently assigned to preside at his extradition hearing while declining to assign a magistrate of his choosing. Additionally, the Namibian High Court did not, at Alexander’s attorneys’ request, rule unconstitutional the Extradition Act which would allow Alexander to be imprisoned at some point during the upcoming extradition hearing. As reported by Bloomberg.com on November 19, 2008 a hearing to request Alexander’s extradition to the United States was postponed until March 4, 2009 pending Alexander’s appeal to Namibia’s Supreme Court regarding which judge should hear the case. This appeal, not yet scheduled, will likely be adjudicated in March or April 2009.
The final outcome of the extradition proceedings can be several years away pending the appeals process. Despite impending extradition proceedings, Alexander has invested heavily within the country.
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
-based Comverse Technology
Comverse Technology
Comverse Technology, Inc. , originally founded in Israel, is a technology company located in Woodbury, New York in the United States, that develops and markets telecommunications software. The company focuses on providing value-added services to telecommunication service providers, in particular to...
. In 2006, he was charged with multiple counts of fraud
Fraud
In criminal law, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation...
and related offenses pertaining to irregularities in trading of Comverse stock; he subsequently fled to Namibia
Namibia
Namibia, officially the Republic of Namibia , is a country in southern Africa whose western border is the Atlantic Ocean. It shares land borders with Angola and Zambia to the north, Botswana to the east and South Africa to the south and east. It gained independence from South Africa on 21 March...
, a nation which has no extradition treaty with the US.
Alexander founded Comverse Technology (NASDAQ: CMVT) in 1982 and built it up from a 3-person Israeli startup to employing over 5,000, becoming the leading provider of software and systems for telecommunication companies worldwide. Comverse’s success led to its inclusion in the NASDAQ 100 and S&P 500 indices.
Early life
Alexander was born on May 4, 1952, into a middle class family in Kfar SabaKfar Saba
Kfar Saba , officially Kfar Sava, is a city in the Sharon region, of the Center District of Israel. At the end of 2009, Kfar Saba had a total population of 83,600.-History:...
, Israel
Israel
The State of Israel is a parliamentary republic located in the Middle East, along the eastern shore of the Mediterranean Sea...
. His mother was a school teacher, and his father an officer in the signal corps of the Israeli Defense Forces, and later, the Managing Director of the Israeli National Oil Company.
Following military service, Alexander enrolled in the Hebrew University of Jerusalem
Hebrew University of Jerusalem
The Hebrew University of Jerusalem ; ; abbreviated HUJI) is Israel's second-oldest university, after the Technion – Israel Institute of Technology. The Hebrew University has three campuses in Jerusalem and one in Rehovot. The world's largest Jewish studies library is located on its Edmond J...
, receiving a BA in Economics Magna Cum Laude in 1977. In 1978 he traveled to the United States earning an MBA at New York University
New York University
New York University is a private, nonsectarian research university based in New York City. NYU's main campus is situated in the Greenwich Village section of Manhattan...
.
In his early years in New York, he met an electrical engineer and together with his brother in law, a professor of Computer Science at Columbia University, the three conceived voice mail technology and developed the idea of what was to become Comverse Technology. The founders understood already then that communications will be a big market, and pioneered the voice mail systems that today are used by telecoms worldwide to support telephony services for the masses.
Career
In 1981, fresh with his NYU MBA, Alexander returned to Israel to bootstrap Comverse. In 1986, after struggling for over 4 years with the company reaching the brink of bankruptcy, the two other founders left their operational roles, and subsequently left the company.Upon taking the helm, Alexander made three key strategic decisions:
- Selling strictly to telecoms, who in turn represented hundreds of thousands of end user licenses for Comverse systems, and who enabled Comverse to piggyback on their growth.
- Focusing on markets outside the U.S. where competition was weaker, enabling Comverse to establish leadership in certain regions early on.
- Raising financing when market conditions were favorable.
Within a short amount of time, Comverse was back on its feet. A major breakthrough came when Alexander convinced Swiss telecom giant Ascom to invest US$6 million in the company in the mid eighties, providing Comverse the capital it needed to realize its dream. In 1986, Alexander was able to take Comverse public on the NASDAQ
NASDAQ
The NASDAQ Stock Market, also known as the NASDAQ, is an American stock exchange. "NASDAQ" originally stood for "National Association of Securities Dealers Automated Quotations". It is the second-largest stock exchange by market capitalization in the world, after the New York Stock Exchange. As of...
.
In 1997, Comverse bought its main competitor for US$700 million, at the time the largest acquisition to date for an Israeli based company. Comverse Technology, Inc., which owns 100% of Comverse, also owns majority equity in several other companies, including Verint and Ulticom. It has over US$1.5 billion in sales to over 450 telecoms in 120 countries supporting more than 450 million subscribers worldwide. As of March 2006, the company employed approximately 6000 people in over 50 countries, had a market capitalization of approximately US$6 billion, and over US$2.2 billion in cash.
Awards & Accomplishments
For his achievements over the last 25 years, Alexander received the global business community’s highest awards and accolades. He came 12th in Chief Executive Magazine’s: “Market Value Added Ranking” of the CEOs of the 1000 largest US corporations, ranking those that “created the most wealth for shareholders”. The successes of Kobi and Comverse were recognized by the world’s leading publications including Barron’s, Bloomberg, Business Week, Financial World, Forbes, Fortune, International Business, and Wall Street Journal. Kobi was awarded “Entrepreneur of the Year” by both Ernst & Young and Deloitte & Touche.The Wall Street Transcript, naming Kobi Alexander as the Gold Award Winner in the Computer Telephony industry said: “… an exceptional management team have yielded consistently outstanding revenues, earnings, and shareholder value. Alexander has set some very high standards for this company and this industry.”
In addition to Comverse Technology, Alexander spun off and took public several other companies including Ulticom (NASDAQ: ULCM) and Verint Systems (NASDAQ: VRNT). Companies under his leadership were listed in Barron’s 500, Business Week: “Hot Growth Companies”, “Business Week 50”, Business Week: “The Information Technology 100”, Financial World: “America’s Best 100 Growth Companies”, Fortune: “100 Fastest Growing Companies”', International Business: “100 Fastest-Growing International Companies”, Wall Street Journal: “10-Year Best Performers”, and Wall Street Journal “Honor Roll”, among others. In 2006, Comverse was named one of Institutional Investor: America's Most Shareholder-Friendly Companies". "As CEO of Comverse, Alexander was sought out by the likes of former Chinese President Jiang Zemin
Jiang Zemin
Jiang Zemin is a former Chinese politician, who served as General Secretary of the Communist Party of China from 1989 to 2002, as President of the People's Republic of China from 1993 to 2003, and as Chairman of the Central Military Commission from 1989 to 2005...
, who slipped away from official meetings in 2000 and steered his motorcade through a pot-holed section of Tel Aviv to meet with him." He served as the Chairman of the Board
Chair (official)
The chairman is the highest officer of an organized group such as a board, committee, or deliberative assembly. The person holding the office is typically elected or appointed by the members of the group. The chairman presides over meetings of the assembled group and conducts its business in an...
and Chief Executive Officer
Chief executive officer
A chief executive officer , managing director , Executive Director for non-profit organizations, or chief executive is the highest-ranking corporate officer or administrator in charge of total management of an organization...
of CTI from 1987 to May 1, 2006, when he resigned during an investigation being conducted by a Special Committee of CTI's Board of Directors
Board of directors
A board of directors is a body of elected or appointed members who jointly oversee the activities of a company or organization. Other names include board of governors, board of managers, board of regents, board of trustees, and board of visitors...
into the timing of CTI's stock option grants. He was Chairman of several CTI subsidiaries, including Verint and Ulticom.
Criminal charges
On July 31, 2006, Alexander, who holds IsraelIsrael
The State of Israel is a parliamentary republic located in the Middle East, along the eastern shore of the Mediterranean Sea...
i citizenship, was charged by United States Department of Justice
United States Department of Justice
The United States Department of Justice , is the United States federal executive department responsible for the enforcement of the law and administration of justice, equivalent to the justice or interior ministries of other countries.The Department is led by the Attorney General, who is nominated...
authorities with multiple charges of conspiracy
Conspiracy (crime)
In the criminal law, a conspiracy is an agreement between two or more persons to break the law at some time in the future, and, in some cases, with at least one overt act in furtherance of that agreement...
to commit various types of fraud
Fraud
In criminal law, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation...
(including securities fraud
Securities fraud
Securities fraud, also known as stock fraud and investment fraud, is a practice that induces investors to make purchase or sale decisions on the basis of false information, frequently resulting in losses, in violation of the securities laws....
, wire fraud
Wire fraud
Mail and wire fraud is a federal crime in the United States. Together, 18 U.S.C. §§ 1341, 1343, and 1346 reach any fraudulent scheme or artifice to intentionally deprive another of property or honest services with a nexus to mail or wire communication....
and mail fraud), as well as with related offences, all relating to the timing of Comverse's stock option grants.
After Alexander left the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
on June 21, 2006 on a pre-planned annual vacation in Israel, his lawyers arranged with American authorities that he would return to face indictment
Indictment
An indictment , in the common-law legal system, is a formal accusation that a person has committed a crime. In jurisdictions that maintain the concept of felonies, the serious criminal offence is a felony; jurisdictions that lack the concept of felonies often use that of an indictable offence—an...
on July 30, 2006; however, he instead traveled to Germany
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
. On July 31 he was added to the FBI's Most Wanted List.
On August 9, 2006 the United States Securities and Exchange Commission
United States Securities and Exchange Commission
The U.S. Securities and Exchange Commission is a federal agency which holds primary responsibility for enforcing the federal securities laws and regulating the securities industry, the nation's stock and options exchanges, and other electronic securities markets in the United States...
filed a civil injunctive action in the United States District Court for the Eastern District of New York
United States District Court for the Eastern District of New York
The United States District Court for the Eastern District of New York is the federal district court whose jurisdiction comprises the entirety of Long Island and Staten Island...
against Alexander, along with alleged co-conspirators William F. Sorin, Comverse’s former Senior General Counsel, and David Kreinberg, Comverse’s former Chief Financial Officer
Chief financial officer
The chief financial officer or Chief financial and operating officer is a corporate officer primarily responsible for managing the financial risks of the corporation. This officer is also responsible for financial planning and record-keeping, as well as financial reporting to higher management...
. The complaint makes nine claims of violation of the Securities Act and the Exchange Act
Securities Exchange Act of 1934
The Securities Exchange Act of 1934 , , codified at et seq., is a law governing the secondary trading of securities in the United States of America. It was a sweeping piece of legislation...
, including fraud (First and Second Claims), and falsification of books, records or accounts (Fourth Claim). Through this action, the Commission is seeking permanent injunctive relief, disgorgement of ill-gotten gains, civil damages, and a prohibition against any of the defendants becoming officers of a securities-issuing entity under SEC jurisdiction.
Alexander transferred over 40 million dollars from his personal U.S. bank account to his personal bank account in Israel. He was arrested by Interpol
Interpol
Interpol, whose full name is the International Criminal Police Organization – INTERPOL, is an organization facilitating international police cooperation...
in Windhoek, Namibia on September 27, 2006. He was released on bail on October 3, 2006. According to a Reuters report of April 23, 2007, the Namibian government described Alexander as “very passionate" about the country and its people; Alexander has promised to boost academic interest in science and technology in Namibia by establishing an annual scholarship for primary and secondary level students. He has also begun to introduce advanced technology to the country with his development of a low budget solar powered housing project for 100 low-income Namibian families.
Despite fighting extradition to the United States, Alexander announced on January 28, 2008 that he has filed suit against Comverse. Alexander claims the firm owes him $72 million in severance, unexercised stock options, and bonus pay.
On July 3, 2008 a Namibian court split decisions for and against Alexander granting his request to remove the judge currently assigned to preside at his extradition hearing while declining to assign a magistrate of his choosing. Additionally, the Namibian High Court did not, at Alexander’s attorneys’ request, rule unconstitutional the Extradition Act which would allow Alexander to be imprisoned at some point during the upcoming extradition hearing. As reported by Bloomberg.com on November 19, 2008 a hearing to request Alexander’s extradition to the United States was postponed until March 4, 2009 pending Alexander’s appeal to Namibia’s Supreme Court regarding which judge should hear the case. This appeal, not yet scheduled, will likely be adjudicated in March or April 2009.
The final outcome of the extradition proceedings can be several years away pending the appeals process. Despite impending extradition proceedings, Alexander has invested heavily within the country.