SEC Settles Options Backdating Case Against William Sorin, Former General Counsel of Comverse Technology, Inc.

Relief Includes Officer-and-Director Bar and Over $3 Million in Civil Penalties, Disgorgement, and Prejudgment Interest

FOR IMMEDIATE RELEASE
2007-4

Washington, D.C., Jan. 10, 2007 - The Securities and Exchange Commission today settled civil fraud charges against the former General Counsel of Comverse Technology, Inc., William F. Sorin, under an agreement which provides for the payment of over $3 million in civil penalties, disgorgement, and prejudgment interest, a permanent injunction, a permanent officer-and-director bar, and suspension from appearing or practicing before the Commission as an attorney.

The Commission charged Sorin and two other former Comverse executives on Aug. 9, 2006, with, among other things, engaging over many years in a fraudulent scheme to grant undisclosed in-the-money options to themselves and to others by backdating stock option grants to coincide with historically low closing prices of Comverse common stock. The Commission's complaint alleges that Sorin created company records that falsely indicated that Comverse's compensation committee had approved a grant of stock options on a date when, in reality, no such corporate action took place. The complaint also alleges that Sorin created false company records that facilitated a similar backdating scheme at Ulticom, Inc., another public company that is a majority-owned subsidiary of Comverse.

Linda Chatman Thomsen, Director of the SEC's Enforcement Division, said, "Today's settlement signals that the Commission will vigorously pursue those responsible for backdating schemes wherever the investigation may lead, even, as appropriate, into the offices of corporate counsel."

Without admitting or denying the allegations of the Commission's complaint, Sorin consented to the entry of a final judgment permanently enjoining him from violating or aiding and abetting violations of the antifraud, reporting, record-keeping, internal controls, false statements to auditors, and securities ownership reporting provisions of the federal securities laws. He is required to pay $1,670,915.03 in disgorgement, of which $1,007,201.58 represents the "in-the-money" benefit from exercises of backdated option grants. In addition, Sorin will pay $817,509.07 in prejudgment interest on the full disgorgement amount, and a $600,000 civil penalty, for a total of $3,088,424.10. The settlement is subject to the approval of the United States District Court for the Eastern District of New York.

In a separate matter filed in the United States District Court for the Eastern District of New York on Nov. 2, 2006, Sorin pleaded guilty to one criminal count of conspiracy to commit securities fraud, mail fraud, and wire fraud. The plea was the result of an agreement between Sorin and the United States Attorney's Office for the Eastern District of New York.

The Commission would like to acknowledge the ongoing assistance of the United States Attorney's Office for the Eastern District of New York and the Federal Bureau of Investigation, which conducted their own separate, parallel investigation resulting in distinct criminal charges.

The Commission's investigation in this matter is continuing.

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For more information, contact:

Antonia Chion
Associate Director
(202) 551-4842
Division of Enforcement
U.S. Securities and Exchange Commission

Christopher R. Conte
Associate Director
(202) 551-4834
Division of Enforcement
U.S. Securities and Exchange Commission

  Additional materials: Press Release Nos. 2006-137 and 2006-180; Litigation Release Nos. 19796, 19878 and 19964

http://www.sec.gov/news/press/2007/2007-4.htm