The SEC settled its options backdating case against co-founder and former Chairman and CEO of Comverse Technology, Inc. Jacob "Kobi" Alexander on November 23, 2010. The SEC alleged that Alexander and two other former Comverse executives had engaged in fraudulent options backdating for over a decade and hid this from shareholders by making material misrepresentations regarding Comverse's option grants. The three Comverse executives purportedly backdated options to coincide with historically low closing prices and created a slush fund of backdated options by granting options to fictitious employees, which were later used to recruit and retain real employees. As a result of the purported scheme, the SEC alleged that Comverse materially overstated its net income and earnings per share over the decade-long period.

The proposed final judgment, which requires court approval, orders Alexander to pay $47.6 million in disgorgement and prejudgment interest, and $6.0 million in civil penalties. This is one of the largest penalties ever imposed in an options backdating action. Without admitting or denying the SEC's allegations, Alexander consented to the entry of the final judgment permanently enjoining him from violating federal securities laws and permanently barring him from serving as an officer or director of a public company. SEC Release