By Samuel Rubenfeld
April 7, 2011
Wasll Street Journal
Comverse Technology Inc. agreed to pay $2.8 million to U.S. regulators to settle foreign bribery violations.
According to a non-prosecution agreement it signed with the Justice Department, Comverse accepted responsibility for violating the books and records provisions of the Foreign Corrupt Practices Act for failing to accurately record payments made from 2003 to 2006 by employees and a third-party agent of the company's subsidiaries to individuals connected to a Greek telecoms provider in order to obtain purchase orders.
The payments, according to the agreement, totaled $536,000, and they were inaccurately characterized as agent commissions in the books of a Tel Aviv-based subsidiary of Comverse.
Paul Baker, a company spokesman, did not immediately return a request for comment.
The company agreed to pay a $1.2 million criminal penalty to the Justice Department, and a $1.6 million disgorgement to the Securities and Exchange Commission. Justice agreed not to prosecute the company so long as it satisfies the conditions of the agreement, which stands for two years.
The Justice Department said it made the agreement not to prosecute after the company investigated itself, voluntarily disclosed the conduct and cooperated with the department. It also overhauled its compliance structure, implementing mandatory training on how to properly use third-party agents and their intermediaries and more rigorous controls for the approval of payments.
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