Former Buying Cost Apple $10M

Former Buying Cost Apple $10M

apple-suffers-10M-loss

Picture: ilounge

As per federal investigators, an ex-Apple employee has defrauded the company of $10 million. He exploited his role as a supply management buyer to receive kickbacks, forcing Apple to pay for undelivered products and services.

According to reports from the Internal Revenue Services authorities, Dhirendra Prasad, charged on Friday, worked for Apple from 2008 to 2018. He spent most of his time as a buyer in the company's "Global Service Supply Chain." Prasad is reported to have "abused his position as a vendor manager by participating in a variety of various scams to defraud Apple."

Silicon Valley has obtained a government press release centering on this issue. The press stressed that illegal acts include "getting kickbacks, stealing components, and forcing Apple to pay for things and services it never got." Each of these five offenses has a possible five to twenty years penalty, covering tax evasion, money laundering, and fraud. Apple is believed to have suffered losses of over $10 million due to the operations.

Prasad is scheduled to make his first appearance in court on Thursday in the United States District Court, San Jose. The federal governments have also been granted court authorization to confiscate Prasad's 5 million profits and assets. They plan to keep the properties as proceeds of crime.

Trusted sources allege that two more persons in California were also involved in the conspiracy. The duo retained firms that had been sold to Apple, colluding with Prasad to commit money laundering and fraud. Both were accused in separate federal prosecutions, and investigators assert that the two have been apprehended to "acknowledge their role."

Prasad is scheduled to appear in court on March 24. Investigators have also acquired a court order seizing millions of dollars in assets, including five residences, which they want to retain as proceeds of crime. At the moment, it was still unknown if Prasad had hired a private lawyer. 

"For the first court, Prasad would be charged with a conspiracy to conduct wires and mail frauds between 2013 and January 2019. After that, he would be assessed for accusations of separate schemes to launder fraud profits in the next two courts. The fourth court charges Prasad's attempt to dodge a co-tax conspirator's duties for several years. And the fifth court centers on Prasad's deliberate dodging of his tax liabilities," Department of Justice elaborated.

Reuters sought to reach Prasad for comment but found his mobile phone was unconnected. 

It Is Not A New Trend

employee-fraud-not-new

Picture: 9to5mac

For decades, employee fraud has been a massive issue. Here are some staggering statistics:

1/ Employee fraud costs businesses an average of  5% of total sales each year.

2/ The average cost of a fraud case is $1,509,000.

3/ The four sectors where fraud occurs most frequently are operations, accounting, senior and high management, and sales.

4/ Compared to big businesses, small firms double the billing and payment fraud rate.

5/ 85% of embezzlement instances involve high-rank managers. One-fifth are C-level executives.

6/ 79% of these cases have at least two perpetrators.

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Jessica Vieira
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Jessica Vieira
Jessica Vieira is ProductReviews's senior media reporter, covering the intersection of entertainment and technology.

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