It's all in the distance between the flash, the subject and the background
If you've got the flash 5ft from the subject an they're 5ft from the background then the subject gets roughly double the light the background gets.
If you move the subject to 1ft from the flash, then they get roughly 8 times as much flash as the background.
This thread of mine is where we discussed a similar thing.
http://www.talkphotography.co.uk/forums/showthread.php?t=157008
As Garry said above, making the light source bigger allows you to get it closer without being harsh (hence "soft"box). You can get the damn things right in close (just out of frame), wind the power down and make the background disappear into the darkness.
It may be that you're getting the ambient light polluting the background too. So another thing you want to check is that when you set your exposure, that the background is completely black if you shoot it without flash. Start with the highest sync speed you can (1/250th on the D700 iirc) and work from there, shooting at f2.8 isn't going to help control the ambient either, so I'd start around f8 until I'd got it black at 1/250th or slower.
Once it's black with no flash, then you can start dialling up the flash, moving it around, and if you get a grey background, you know it's being lit by the flash, so you adjust a bit more, drop the power, move it closer to the subject and so on.
Experiment, but only change one thing at a time, otherwise you'll not spot which change is the right one
