Kobi agrees to face US charge

ISRAELI-BORN businessman Jacob (‘Kobi’) Alexander has decided to return to the United States of America to deal with the case in which he has been facing criminal charges since 2006.

After close to 10 years of living in Namibia while resisting an attempt by the American government to have him extradited to the US, where he was wanted on 35 criminal charges, Alexander has decided to return to the US “to address and resolve his remaining outstanding legal issues”, lawyers representing Alexander announced in a statement on his behalf yesterday.

The statement was issued after Alexander appeared before Windhoek Regional Court magistrate Alexis Diergaardt yesterday to waive his right to go through a formal enquiry on the US government’s request for his extradition from Namibia. Alexander’s waiver of an extradition hearing, after nearly 10 years of adroit legal manoeuvring kept an extradition hearing from getting started in Namibia, opened the way for the minister of justice to order Alexander’s return to the US.

Alexander (64) is expected to plead guilty to one charge in an indictment that has replaced the charges initially brought against him, the American business news television channel CNBC reported yesterday. He is expected to give his plea during a court appearance in New York City tomorrow.

The New York-based newspaper Newsday also reported yesterday, quoting a New York lawyer representing Alexander, that he would be admitting guilt to one count of backdating stock options.

Alexander has been wanted in the US on 35 criminal charges connected to allegations that he had committed fraud with the receipt of stock options in Comverse Technology Inc, a New York-based company that he had helped found in 1982 and ran until early 2006.

Having previously lived in New York City, Alexander, his wife and their three children relocated to Namibia late in July 2006 – shortly before a grand jury in New York decided to charge him with 32 counts, which included multiple charges of fraud and money laundering. The number of charges later increased to 35.

The charges were based on allegations that during the time he was running Comverse as its chief executive officer and board chairman, Alexander changed the dates on which he was given the option to buy shares in the company at some point in the future.

It was alleged that Alexander backdated his stock options to earlier dates when the shares traded at lower prices on the stock market – a move that resulted in increasing the profits he made when he decided to exercise the options to buy the shares later on.

According to Alexander’s lawyers, he made profits amounting to US$138 million through exercising the stock options granted to him as part of his pay as CEO and board chairman of Comverse, but only an amount of US$6,4 million was attributable to the alleged backdating of stock options.

While resisting extradition from Namibia, Alexander reportedly settled a case with the US Securities and Exchange Commission for more than US$53 million in 2010.

No extradition agreement existed between Namibia and the US at the time that Alexander and his family travelled to Namibia, where they ended up setting up home for nearly a decade.

They had been in Namibia for only about two months, though, when the US was designated as a country to which people could be extradited from Namibia under the country’s Extradition Act. Alexander was arrested on a request from the US government on the same date that the proclamation designating the US as a country to which people could be extradited from Namibia was published in the Government Gazette.

Alexander later challenged the constitutionality of that proclamation in the High Court. A judgement on his challenge, on which oral arguments were heard in April 2012, is still being awaited.

Alexander was released on bail in an amount of N$10 million, which still remains a record bail amount for Namibia, after spending five days in jail following his arrest. Magistrate Diergaardt extended his bail when he appeared before her yesterday.

In the statement issued by his lawyers, it was also stated that Alexander and his family have been financing and operating soup kitchens providing meals to children in Katutura in Windhoek and Kuisebmond at Walvis Bay since 2007. The soup kitchens, where seven people are employed and 700 children are fed each day, will continue to operate, according to the statement.

In an age of information overload, Sunrise is The Namibian’s morning briefing, delivered at 6h00 from Monday to Friday. It offers a curated rundown of the most important stories from the past 24 hours – occasionally with a light, witty touch. It’s an essential way to stay informed. Subscribe and join our newsletter community.