Skip to main content

COMVERSE TECHNOLOGY INC. AGREES TO PAY $1.2 MILLION PENALTY TO RESOLVE VIOLATIONS OF THE FOREIGN CORRUPT PRACTICES ACT

WASHINGTON - Comverse Technology Inc. (CTI), a New York City headquartered corporation, has agreed to pay a $1.2 million penalty for violations of the Foreign Corrupt Practices Act (FCPA), announced Assistant Attorney General Lanny A. Breuer of the Criminal Division. CTI, through its main operating subsidiary Comverse Inc. and Comverse Inc.’s subsidiaries, is a global provider of software and software systems for communication and billing services.

According to the non-prosecution agreement, CTI has accepted responsibility for violating the books and records provisions of the FCPA arising from and related to CTI’s failure to record accurately certain improper payments that were made between 2003 and 2006 by employees and a third-party agent of Comverse Inc. subsidiaries to individuals connected to OTE, a Greek telecommunications provider, in order to obtain purchase orders. The payments, totaling approximately $536,000, were inaccurately characterized as legitimate agent commissions in the books and records of Comverse Ltd., a wholly owned subsidiary of Comverse Inc. that is based in Tel Aviv, Israel.

The agreement recognizes the company’s thorough self-investigation and the results of its investigation, voluntary disclosure of the underlying conduct, and full cooperation with the department. CTI has also undertaken extensive remedial efforts and overhauled its overall compliance culture, including through the implementation of mandatory training programs focused on anti-corruption and the use of third-party agents and intermediaries, as well as more rigorous accounting controls for the approval of third-party payments.

As a result of these mitigating factors, the department has agreed not to prosecute CTI or its subsidiaries for failing to maintain accurate books and records, provided that CTI satisfies its obligations under the agreement for a period of two years. Those obligations include ongoing cooperation, payment of the $1.2 million penalty, and the continued implementation of rigorous internal controls.

In a related matter, CTI reached a settlement today with the U.S. Securities and Exchange Commission in which it agreed to pay approximately $1.6 million in disgorgement and pre-judgment interest.

This case is being handled by Trial Attorney Amanda Aikman of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Ilene Jaroslaw of the U.S. Attorney’s Office for the Eastern District of New York. The department acknowledges and expresses its appreciation for the significant assistance provided by the staff of the SEC during the course of this investigation.

Comments

Popular posts from this blog

15 Gang Members Convicted on Conspiracy, Weapons Possession, Firearms Trafficking Charges Case Follows Recent Convictions of 137th Street Crew and East Harlem Narcotics Trafficking Organization

Manhattan District Attorney Cyrus R. Vance, Jr., announced the results of the investigation and prosecution of one of Central Harlem’s most destructive criminal street gangs, referred to as “ONE TWENTY-NINE” or “GOODFELLAS/THE NEW DONS,” which terrorized the neighborhood surrounding West 129th Street between Lenox and Fifth Avenues. Thirteen members of the gang have previously pleaded guilty to importing, possessing, and using firearms over the course of the conspiracy.

Mortgage Fraud

Manhattan District Attorney Robert M. Morgenthau announced today the indictment of 13 individuals and a mortgage origination company for perpetrating over $100 million in mortgage fraud over a four-year period in the New York City metropolitan area. In addition, 12 individuals have already waived indictment and pleaded guilty to felonies relating to their participation in the mortgage fraud scheme. The indictment charges 13 individuals and the mortgage company, AFG FINANCIAL GROUP, INC., with enterprise corruption, grand larceny, scheme to defraud and conspiracy involving 19 fraudulent mortgage transactions. The defendants include the principals and a number of employees of the mortgage company, as well as bank employees, appraisers, and three attorneys. Two other attorneys are among the defendants who already pleaded guilty. The crimes charged in the indictment occurred between June 2004 and April 2009 with the bulk of the fraudulent closings occurring from mid-2005 through the end of...

DISTRICT ATTORNEY VANCE ANNOUNCES INDICTMENT OF SIX SUBCONTRACTING COMPANIES AND THEIR OWNERS IN MULTIMILLION-DOLLAR FRAUD

Manhattan District Attorney Cyrus R. Vance, Jr., today announced the indictments of six subcontracting companies and their owners for colluding with LEHR CONSTRUCTION CORPORATION (LEHR) in a multimillion dollar scheme that defrauded numerous construction clients over the past decade. See, related story. The announcement comes one day after DA Vance announced LEHR and four executives were indicted on crimes including Enterprise Corruption, the New York State Racketeering law. GODSELL CONSTRUCTION CORPORATION and its owner ARTHUR GODSELL are charged with Grand Larceny in the Second Degree. JT ROSELLE LIGHTING, INC. and its owner JAMES ROSELLE, LIBERTY CONTRACTING CORPORATION and its owners GEORGE FOTIADIS and KEVIN FOTIADIS, PJ MECHANICAL and its owner JAMES PAPPAS, SUPERIOR ACOUSTICS, INC. and its owner KENNETH MCGUIGAN, and SWEENEY & HARKIN CARPENTRY and its owner MICHAEL HAYES are charged with Grand Larceny in the Third Degree.[1] "The defendants in this case cheated clie...