Former Apple worker pleads guilty to $17m mail and wire fraud charges

A one-time Apple employee working as a buyer within the iGiant's supply chain department has pleaded guilty to mail and wire fraud charges spanning multiple years, ultimately costing the company $17 million.

Dhirendra Prasad, 52, of Mountain House, California, worked at Apple from 2008 to 2018 and operated in the Global Service Supply Chain for most of that time. He was tasked with buying parts and services for Apple from various vendors.

According to the US Attorney's Office for the Northern District of California, Prasad admitted in a written statement that he began to defraud Apple as early as 2011 by "accepting kickbacks, inflating invoices, stealing parts, and causing Apple to pay for items and services never received."

The former Apple worker ran these fraudulent schemes through to 2018 and "ultimately resulted in a loss to Apple of more than $17 million," the office stated.

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Co-conspirators included Robert Gary Hansen and Don M Baker, both of whom reside in the Central District of California. The pair each owned vendor companies and engaged with Apple. Both admitted they had "conspired with Prasad to commit fraud and money laundering" earlier this year.

In one of several frauds devised by Prasad, he had motherboards shipped from Apple's inventory to CTrends, Baker's company. Baker was to have the board's components harvested, and Prasad issued purchase orders for those products. Baker shipped the components back to Apple and CTrends submitted an invoice. The pair then split the proceeds of the crime.

A separate example in 2016 saw Prasad arrange to have parts shipped from Apple's stockholding in a Nevada warehouse to Hansen's business, Quality Electronics Distributors Inc. Hansen then intercepted the components, removed their packaging, put them in new packaging and sent them back to Apple's warehouse. Prasad raised a purchase order and Hansen submitted an invoice to bill Apple for parts it already owned. The duo shared the subsequent payment.

The Attorney's Office added: "In addition to the many fraud schemes, Prasad admitted he engaged in tax fraud by funneling illicit payments from Hansen directly to Prasad's creditors. Prasad also caused a shell company to issue sham invoices to CTrends in order to conceal Baker's illicit payments to Prasad and to allow Baker to claim hundreds of thousands of dollars of unjustified tax deductions. These schemes resulted in an IRS loss of more than $1.8 million.

"The United States also instituted a civil forfeiture action to forfeit the assets acquired by Prasad with the fraud proceeds, including multiple real properties he purchased and numerous financial accounts containing funds traced to Prasad's crimes. These assets have an aggregate value of approximately $5 million. Today, Prasad agreed to forfeit all the assets to the United States."

Prasad pleaded guilty to one count of conspiracy to commit mail fraud and wire fraud, carrying a maximum sentence of 20 years, and he also admitted one count of conspiracy to defraud the US "in violation of 18 U.S.C. § 371." This carries a maximum sentence of five years. It is, of course, for the court to decide the length of the sentence. ®