A key manager of Apple, Inc. has been charged and arrested in California, in relation to allegations that he had been getting kickbacks for leaking insider secrets to companies in Asia that are supposed to be suppliers of Apple’s banner phone, the iPhone and its accessories.
Since 2005, Paul Shin Devine has been working for the technology giant Apple, as a global supply manager. Federal authorities are now making him face accusations of receiving kickbacks from at least six companies based in Asia. The identity of these companies were not revealed by the authorities, although they have named which Asian countries these companies are based – China, South Korea, Singapore, and Taiwan. Wall Street Journal has named these companies as Kaedar of China, Creslyn of SoKor, and Jin Li of Singapore.
Cases galore for Devine
The Cupertino, California-based company has also filed a civil suit against Devine, 37 years old, accusing him of getting bribes and payments of over $1 million for the past years from the Asian companies.
Last Friday, Devine appeared before a San Jose court. Court documents did not record any setting of bail for Devine. He was set to return to court on Monday, as scheduled. In the federal grand jury, Devine was charged with 23 counts of assorted crimes, including conspiracy, accepting kickbacks, wire fraud, and money laundering.
Apple spokesman, Steve Dowling, read a statement from the company, saying the Apple adheres to the highest standards in ethics when they do business. Therefore, any dishonest behavior both within the company and out is never tolerated, according to him.
What did Devine really do?
According to reports, Devine used his position at Apple to his advantage by gathering information that are supposedly to be used by the company alone. He shared it with suppliers of Apple overseas so that he, in turn, could be paid and these companies could negotiate better conditions with Apple. According to the court reports, Devine did share his kickback earning with an Andrew Ang of Singapore. For his part, Ang was also slapped with three counts of conspiracy and wire fraud charges.
Investigation regarding this matter was done by the joint forces of the Internal Revenue Service (IRS) and the Federal Bureau of Investigation (FBI). Devine was set to appear before the federal court on Monday.
The funds paid by the firms to Devine were said to be laundered through a number of foreign and US accounts in different banks in the country and outside it. The payments were then supposed to be “samples,” which are funneled to accounts under his name and his wife’s as well.
Reports say that investigators found out about Devine’s activities when they read his e-mail. There were letters that point out to Devine giving Apple suppliers information that give them the edge in possibly leaking the same information to Apple’s direct competitors.