Kobi disputes ‘money laundering’ claim

ISRAELI businessman Jacob (‘Kobi’) Alexander has taken strong exception to a statement by an American diplomat who reportedly described him as an alleged money launderer who managed to bring more than N$100 million into Namibia in 2006.

According to a report published in The Namibian on February 27, the United States Embassy’s Deputy Head of Mission in Namibia, Eric Benjaminson, had made a remark the previous day about Alexander being “an example of an alleged money launderer who was able to move more than N$100 million into Namibia in 2006”. The comment was made at a money-laundering seminar that was co-hosted by the US Embassy and the Bank of Namibia.Alexander had not laundered money by having funds transferred from a bank account in Israel to Namibia, and he maintains that he has not committed any crimes in the US, where he is wanted on 33 criminal charges, Alexander responded through his lawyers, Metcalfe Legal Practitioners, in a letter sent to a host of official bodies in Namibia a week and a half ago.The letter was sent to the Prosecutor General, the Governor and Assistant Governor of the Bank of Namibia, the Minister of Finance, the Attorney General and Minister of Justice, the Permanent Secretary of Justice, the Anti-Money Laundering Advisory Council, the Permanent Secretary in the Ministry of Home Affairs, and the Chairperson of the Immigration Selection Board.Alexander has been living in Namibia since late in July 2006.At that stage, the US authorities already were investigating allegations that Alexander had been involved in an illegal stock-options backdating scheme involving shares in a New York-based telecommunications technology company, Comverse Technology Inc, of which Alexander was one of the co-founders in 1982.Alexander received a two-year work permit or Namibia on August 29 2006.With the US authorities requesting the Namibian Government to extradite Alexander to the US to stand trial on the charges he is facing in a New York court, Alexander was arrested in Windhoek on September 27 2006.He was released from Police custody after he had been granted bail of N$10 million on October 3 2006.Alexander has since then been fighting legal proceedings in Namibia to have him extradited to the US.In an indictment that Alexander is facing in a New York court, it is alleged that he was involved in backdating stock options that he had received as part of his executive pay at Comverse, to enable him to buy the shares at prices that were valid on dates before he received the stock options, with the result that the profits that he could make by later selling the shares were increased in the process.CHARGES DENIED “We are adamant that Mr Alexander is innocent of the charges brought against him in the United States,” Alexander’s lawyer, Louis du Pisani, stated in the letter written to respond to Benjaminson’s reported remark.The charges against Alexander relate to the alleged backdating of stock options issued to Comverse employees in the period from 1998 to 2001, Du Pisani wrote.Backdating stock options is in itself not illegal, Du Pisani stated.The US authorities are rather alleging that Alexander violated several laws based on a purported failure by Comverse to disclose that stock options granted to its employees had been backdated, and to properly apply the relevant accounting rules.The charges against Alexander are confined to stock options that were granted to him between 1998 and 2001, Du Pisani wrote.Zeroing on what could be one of the pillars of the case against Alexander, Du Pisani then added: “Mr Alexander did not exercise any of the options granted to him in this period.”Alexander however did make a profit of US$138 million (about N$1 092 million at the current exchange rate) from exercising stock options that he had received at Comverse, Du Pisani stated.According to the US authorities, US$6,4 million (about N$50,6 million) of this profit is attributable to the backdating of options before the period covered by the indictment in the case against Alexander – yet the US government wants to have all of Alexander’s profits from exercising his stock options forfeited, Du Pisani pointed out.He added that Alexander did not attempt to conceal any of his money from law enforcement authorities when he transferred about US$57 million (about N$451 million) from a bank account that he had in his own name in the US to accounts that he had in Israel, also in his own name, in July 2006.The US authorities have in the meantime frozen over US$49 million (about N$388 million) of Alexander’s remaining money in two bank accounts in the US, according to Du Pisani.This is more than seven times the amount of money that Alexander is alleged to have earned through illegal stock options backdating before 1998, Du Pisani pointed out before stating: “So there can be no suggestion that any of the funds brought into Namibia by our client constitute the proceeds of alleged unlawful activities”.”The only alleged activities from which the United States authorities can claim our client profited are activities in respect of which our client is not charged criminally.”Alexander’s transfer of N$120 million, or some 12,9 million euro at the time, from Israel to two bank accounts in Namibia in July 2006 is not the subject of money laundering charges against him in the indictment he is facing in the US, according to Du Pisani.He stated that this money was “transferred openly and transparently in his own name in full compliance with all applicable legal requirements and with full disclosure to the Bank of Namibia”.The Bank of Namibia however froze Alexander’s two local bank accounts in October 2006.After Alexander got a High Court order in December that year to have his access to the accounts restored, the money in the accounts was converted into local currency and transferred to Metcalfe Legal Practitioners’ trust account, Du Pisani stated.The comment was made at a money-laundering seminar that was co-hosted by the US Embassy and the Bank of Namibia.Alexander had not laundered money by having funds transferred from a bank account in Israel to Namibia, and he maintains that he has not committed any crimes in the US, where he is wanted on 33 criminal charges, Alexander responded through his lawyers, Metcalfe Legal Practitioners, in a letter sent to a host of official bodies in Namibia a week and a half ago.The letter was sent to the Prosecutor General, the Governor and Assistant Governor of the Bank of Namibia, the Minister of Finance, the Attorney General and Minister of Justice, the Permanent Secretary of Justice, the Anti-Money Laundering Advisory Council, the Permanent Secretary in the Ministry of Home Affairs, and the Chairperson of the Immigration Selection Board.Alexander has been living in Namibia since late in July 2006.At that stage, the US authorities already were investigating allegations that Alexander had been involved in an illegal stock-options backdating scheme involving shares in a New York-based telecommunications technology company, Comverse Technology Inc, of which Alexander was one of the co-founders in 1982.Alexander received a two-year work permit or Namibia on August 29 2006.With the US authorities requesting the Namibian Government to extradite Alexander to the US to stand trial on the charges he is facing in a New York court, Alexander was arrested in Windhoek on September 27 2006.He was released from Police custody after he had been granted bail of N$10 million on October 3 2006.Alexander has since then been fighting legal proceedings in Namibia to have him extradited to the US.In an indictment that Alexander is facing in a New York court, it is alleged that he was involved in backdating stock options that he had received as part of his executive pay at Comverse, to enable him to buy the shares at prices that were valid on dates before he received the stock options, with the result that the profits that he could make by later selling the shares were increased in the process.CHARGES DENIED “We are adamant that Mr Alexander is innocent of the charges brought against him in the United States,” Alexander’s lawyer, Louis du Pisani, stated in the letter written to respond to Benjaminson’s reported remark.The charges against Alexander relate to the alleged backdating of stock options issued to Comverse employees in the period from 1998 to 2001, Du Pisani wrote.Backdating stock options is in itself not illegal, Du Pisani stated.The US authorities are rather alleging that Alexander violated several laws based on a purported failure by Comverse to disclose that stock options granted to its employees had been backdated, and to properly apply the relevant accounting rules.The charges against Alexander are confined to stock options that were granted to him between 1998 and 2001, Du Pisani wrote.Zeroing on what could be one of the pillars of the case against Alexander, Du Pisani then added: “Mr Alexander did not exercise any of the options granted to him in this period.”Alexander however did make a profit of US$138 million (about N$1 092 million at the current exchange rate) from exercising stock options that he had received at Comverse, Du Pisani stated.According to the US authorities, US$6,4 million (about N$50,6 million) of this profit is attributable to the backdating of options before the period covered by the indictment in the case against Alexander – yet the US government wants to have all of Alexander’s profits from exercising his stock options forfeited, Du Pisani pointed out.He added that Alexander did not attempt to conceal any of his money from law enforcement authorities when he transferred about US$57 million (about N$451 million) from a bank account that he had in his own name in the US to accounts that he had in Israel, also in his own name, in July 2006.The US authorities have in the meantime frozen over US$49 million (about N$388 million) of Alexander’s remaining money in two bank accounts in the US, according to Du Pisani.This is more than seven times the amount of money that Alexander is alleged to have earned through illegal stock options backdating before 1998, Du Pisani pointed out before stating: “So there can be no suggestion that any of the funds brought into Namibia by our client constitute the proceeds of alleged unlawful activities”.”The only alleged activities from which the United States authorities can claim our client profited are activities in respect of which our client is not charged criminally.”Alexander’s transfer of N$120 million, or some 12,9 million euro at the time, from Israel to two bank accounts in Namibia in July 2006 is not the subject of money laundering charges against him in the indictment he is facing in the US, according to Du Pisani.He stated that this money was “transferred openly and transparently in his own name in full compliance with all applicable legal requirements and with full disclosure to the Bank of Namibia”.The Bank of Namibia however froze Alexander’s two local bank accounts in October 2006.After Alexander got a High Court order in December that year to have his access to the accounts restored, the money in the accounts was converted into local currency and transferred to Metcalfe Legal Practitioners’ trust account, Du Pisani stated.