kickbacks
Latest
Former Global Operations manager Paul Devine sentenced to one year in prison for selling Apple secrets
Former Apple Global Operations manager Paul Devine was sentenced last week to one year in prison following his guilty plea on charges of money laundering, conspiracy and wire fraud. He also must repay $4.5 million for crimes against his employer Apple. In 2010, Devine was arrested and subsequently pleaded guilty to fraud, conspiracy and money laundering in a scheme that benefited Apple's Asian suppliers and manufacturers. From 2007 until 2010, Devine and partner Andrew Ang received lucrative kickbacks in exchange for confidential internal Apple information such as product specifications and pricing. This information allowed the suppliers to negotiate more favorable contracts with Apple. Devine will begin serving his sentence in February of 2015. An indictment against Ang in the US is still pending while Chua Kim Guan faces charges in his home country of Singapore.
German prosecution charges HP staff with bribing Russian officials to clinch PC contract
The legal system's engines can take awhile to get churning, but there's no questioning the impact when they're at full bore. German prosecutors have wrapped up an almost three-year investigation into allegations of HP managers' bribery by charging the executives involved. Hilmar Lorenz, Päivi Tiippana and Ken Willett, along with claimed accomplice Ralf Krippner, have all been indicted for supposedly funneling €7.5 million ($9.7 million) in bribes through a German subsidiary and far-flung shell accounts to land a €35 million ($45.3 million) PC supply deal with Russia's Prosecutor General Office early in the previous decade. While only the people directly attached to the scandal currently face any consequences if found guilty, German lawyers are motioning to have the PC builder attached to the case, and there's a chance the formal charges could fuel an ongoing US investigation. HP is cooperating even as it's trying to distance itself from the indictments as much as possible -- these are for old allegations and a "former HP company," it says. While we don't yet know the whole story, it may be a protracted tale knowing that at least Tiippana and Willett plan to fight the accusations.
Former Apple employee convicted of money laundering, wire fraud
Former Apple employee Paul Devine pleaded guilty to 23 charges of wire fraud, conspiracy and money laundering following his arrest last August. Devine, a global supply manager, was accused of accepting kickbacks from six Asian suppliers. In return for cash and gifts, he supplied these suppliers with confidential information that gave them an advantage when negotiating lucrative contracts with Apple. Devine allegedly collected over US$1 million in this kickback scheme and deposited the money in various foreign and US banks using accounts setup in his name and his wife's name. Varying amounts of cash were also stored in safety deposit boxes and hidden in shoe boxes in his house. His activities reportedly cost Apple more than $2.4 million in losses. Devine is currently on pretrial release and will return to court on June 6 for his sentencing. He faces up to 20 years in prison for the wire fraud and money laundering charges. He also agreed to forfeit $2.28 million in cash and gifts worth $10,000, most of which were obtained as part of his elaborate kickback scheme. When the criminal trial ends, Devine still faces a civil trial filed by Apple.
Former Apple employee admits he sold confidential info, cost the company in excess of $2 million
Paul Devine, the man who last August collected a pretty lengthy list of charges against his name from the FBI and IRS -- which collectively amounted to an accusation of "screwing Apple" -- has now admitted his guilt. Specifically, Devine has fessed up to wire fraud, conspiracy and money laundering, in which he engaged while exchanging confidential information about upcoming Apple products for cold hard cash from interested parts suppliers. He's now having to forfeit $2.28 million in money and property that resulted from his nefarious exploits, with sentencing scheduled for June 6th. Devine's lawyer is quoted as saying he's a "good man who made a mistake, and now he's trying to make amends." Indeed, the mistake of getting caught and the amends of trying not to go to prison. Jump past the break for a full statement on the matter from the US Department of Justice.
Accused Apple manager could be forced to return $1M in kickbacks
Back in August we learned of the arrest of Paul Shin Devine on charges of taking over $1 million in kickbacks from Apple suppliers. Since that time, prosecutors have been following the money trail and have now asked U.S. District Judge James Ware in San Jose, California to order the forfeiture of US$1 million in cash and assets. The government has frozen $950,000 in cash from six different bank accounts belonging to Devine. Devine was a global supply manager for Apple until his arrest and was accused of providing confidential information to suppliers before they negotiated contracts with the company. Prosecutors are still hanging on to Devine's computers as part of the investigation of the case. The indictment of Devine included 23 charges of wire fraud, wire-fraud conspiracy, and money laundering, each of which carries a potential 20 year prison sentence with a conviction. Devine has pleaded not guilty to all of the charges and is currently out on bail.
HP agrees to pay $55 million to settle investigation into illegal kickbacks
The company that kicked Mark Hurd to the curb for financial impropriety has today reported it'll pay $55 million in a settlement with the US Department of Justice relating to some fiscal delinquency of its own. HP was accused of greasing up the wheels of business, as it were, by throwing cash around to companies who would recommend its services to state procurement agencies. This particular set of allegations related to a federal contract obtained by HP in 2002, and the settlement also extinguishes investigation into whether or not the computer vendor had provided incomplete information to the US government. That's all well and good, but we have to question the size of these levies. Today's also the day that HP's announced a new $800 million supply contract with the US Air Force -- would a fine that's less than a tenth of the contract's value really deter HP's entrepreneurial spirit?
Former Apple manager accused of hiding $125k in shoeboxes
Back when I was a kid, I kept my most valuable possessions, my baseball and basketball card collection, in a shoe box. Apparently, so too did former Apple employee Paul Devine. Devine is accused of wire fraud and conspiracy on the basis that he collected more than $2.5 million in kickbacks from Apple's suppliers. And during their investigation, officials found $125,000 stored away in shoe boxes at his home, as well as more than $20,000 worth of foreign currency. Prosecutors also allege that Devine may have other sources of cash. In Devine's position as a global supply manager at Apple, it's alleged that he was privy to information such as projected sales of Apple products, the cost to manufacture an Apple product, and the prices of bids from competing suppliers. Prosecutors allege that he leveraged this knowledge by providing it to those in the supply chain in return for kickbacks. The allegations against Devine are noteworthy, given Apple's penchant for secrecy. For instance, according to reports, Apple employees must test unreleased products in secret rooms under covered workstations, and are not allowed to follow other employees too closely. [via Macworld]
Apple manager held on kickback charges
The Mercury News is reporting that Sunnyvale, CA resident Paul Shin Devine, a 37-year-old Apple manager in global supply, has been arrested and charged with accepting kickbacks from Asian suppliers. In return, he provided confidential information that allowed these suppliers to negotiate more advantageous contracts with Apple. Devine, and his alleged co-conspirator Andrew Ang of Singapore, have been indicted by a federal grand jury on 23 counts including wire fraud, money laundering and other charges. Devine is being held by the US Marshals Service. Apple's statement on the matter comes from PR lead Steve Dowling: "Apple is committed to the highest ethical standards in the way we do business... We have zero tolerance for dishonest behavior inside or outside the company." Devine is alleged to have collected over $1 million in funds from various suppliers in China, Taiwan, Singapore and South Korea during the scheme; the companies involved have not yet been named publicly. Devine opened bank accounts in several countries in his wife's name to disguise the bribes. [via Apple 2.0]
NEC employees caught up in kickback, fake order scandal
So apparently BenQ and Siemens aren't the only companies whose employees don't like to play by the rules, as tax investigators looking into NEC's shady financials have found that select personnel were involved in schemes that racked up 2.2 billion yen ($18 million) in fake orders and earned them 500 million yen ($4.1 million) in kickbacks. The charges come on top of already shady reporting by the Japanese company, which had to restate its fiscal 2006 earnings three times already and still risks being delisted from NASDAQ save for intervention from the exchange's Hearings Review Council. For its part, NEC offered the typical spiel about regretful actions and possible criminal charges -- which actually seems to have done some good, as the company's domestic shares rose slightly following the news.
