Comverse Technology, Inc. ("Comverse"), a New York corporation that was based in Woodbury, New York, is now headquartered in New York City. Comverse makes software systems and provides related services for multimedia communication and information processing applications. Comverse's main operating subsidiary is Comverse, Inc. ("CNSI"), a Delaware corporation that has its principal place of business in Wakefield, Massachusetts. Comverse Limited is a wholly-owned subsidiary of CNSI and is incorporated in Israel with a principal
place of business in Tel Aviv, Israel.
Between 2003 and 2006, Comverse Limited made improper payments to employees connected to Hellenic Telecommunications Organisation S.A. ("OTE") in order to obtain or retain business with OTE. Around January 2003, Comverse Limited entered into a consulting agreement with an Agent. The Agent created an entity in Cyprus called Fintron Enterprises Ltd. ("Fintron") and opened an account for Fintron at a bank in Cyprus. Comverse Limited then executed an agency contract with Fintron. Fintron played no role in developing, obtaining or retaining business for Comverse Limited. Comverse Limited employees, not Fintron, negotiated business orders with customers. Finiron merely funneled cash to the recipients of Comverse Limited's improper payments. Comverse Limited made payments to Finiron directly into Fintron's Cyprus bank account. The Agent kept 15% of the invoiced amount and withdrew the remaining 85% from Fintron's bank account, which represented the cash bribe to be paid to the Comverse Limited customer.
On April 7, 2011, Comverse entered into a two-year non-prosecution agreement with the DOJ. Under the non-prosecution agreement, Comverse agreed to pay a fine of $1,200,000, and to continue to implement improvements in its internal controls and anti-corruption practices and policies.
In a related action, without admitting or denying the SEC's allegations, Comverse consented to the entry of a final judgment permanently enjoining the company from violating the books and records, and internal controls provisions of the FCPA. Comverse agreed to pay $1,249,614 in disgorgement and $358,887 in prejudgment interest.
