Federal prosecutors have launched a criminal investigation into the way Comverse grants stock options in light of the company's announcement it would restate more than five years of financial results because some option-grants on record didn't match the actual grant dates. That's significant because it appears stock-option grants to top executives were regularly dated just ahead of large share price increases and often near the bottom of steep declines. The dates correspond to low exercise prices on the options so the executives get bigger profits if shares rise. Comverse founder Kobi Alexander and two other executives resigned over the issue.
To read more about Comverse's legal woes:
- check out this article [1] in The Wall Street Journal (sub. req.)
Links:
[1] http://online.wsj.com/article/SB114678872289844424.html?mod=telecommunications_primary_hs