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Former Comverse general counsel wasn't ''the grand Wizard of Oz,'' says the sentencing judge, but still deserves a year behind bars.
Stephen Taub, CFO.com | US
May 11, 2007
William F. Sorin, former general counsel of Comverse Technology, on Thursday became the first executive involved in the stock-option backdating scandal to be sentenced to prison, according to published accounts.
"I have no excuse for my conduct," said Sorin at his hearing on Thursday, according to the Associated Press. "The very fact that I find myself before this court is extremely painful for me and my family."
In rejecting defense attorneys' requests that Sorin be spared prison time, however, U.S. District Judge Nicholas Garaufis asserted that Sorin wasn't "the grand Wizard of Oz," but said that "he facilitated a portion of it with his actions," according to Reuters.
Sorin — who last November pleaded guilty to a single criminal count of conspiracy to commit securities fraud, mail fraud, and wire fraud — was reportedly sentenced to one year and one day in prison, plus three years' supervised release.
He is scheduled to report to prison on August 15, the AP added.
According to the wire service, Judge Garaufis also ordered Sorin to pay $51.8 million in restitution, but the judge stayed that order until the Securities and Exchange Commission resolves its case with the other Comverse defendants. Under federal law, noted the AP, Sorin is liable for the full amount even though other individuals are expected to be ordered to pay restitution.
Sorin's lawyer told reporters afterward that he believes the restitution amount will be cut once the cases with the other defendants are resolved.
In January, Sorin settled civil charges with the SEC and agreed to pay $3.1 million in disgorgement, prejudgment interest, and a civil penalty.
Sorin is one of two former Comverse executives who have pleaded guilty to criminal charges for their roles in backdating stock options. Last year, former chief financial officer David Kreinberg pleaded guilty to securities fraud and conspiracy to commit securities fraud, mail fraud, and wire fraud.
Former chief executive officer Jacob "Kobi" Alexander was also charged in the matter, on counts of conspiracy, securities fraud, making false filings with the SEC, mail fraud, wire fraud, money laundering, and engaging in unlawful monetary transactions. He fled the country and was arrested in October; the U.S. government is seeking his extradition.