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Corrupt Payments Exposed: Comverse Technology Inc. to Pay $1.2 Million Penalty
Comverse Technology Inc., a New York City headquartered corporation, has been caught in a web of corruption after agreeing to pay a $1.2 million penalty for violating the Foreign Corrupt Practices Act (FCPA).
According to a non-prosecution agreement, Comverse Technology Inc. accepted responsibility for violating the books and records provisions of the FCPA arising from and related to Comverse Technology Inc.’s failure to record accurately certain improper payments 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 authorities. Comverse Technology Inc. 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 authorities have agreed not to prosecute Comverse Technology Inc. or its subsidiaries for failing to maintain accurate books and records, provided that Comverse Technology Inc. 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, Comverse Technology Inc. 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.
Comverse Technology Inc., a global provider of software and software systems for communication and billing services, is based in New York City, New York. The exact date of the crime is not specified, but the non-prosecution agreement is dated 2012. Comverse Technology Inc. has agreed to pay a $1.2 million penalty for violating the Foreign Corrupt Practices Act.
Mandatory facts: Defendant – Comverse Technology Inc., Criminal Charges – Violating the Foreign Corrupt Practices Act, City and State – New York City, New York, Exact Date – 2012, Sentence – $1.2 million penalty.
Key Facts
- State: New York
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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