Yale finance director stole $40m in computers to resell on the sly A now-former finance director stole tablet computers and other equipment worth $40 million from the Yale University School of Medicine, and resold them for a profit. Jamie Petrone, 42, on Monday pleaded guilty to one count of wire fraud and one count of filing a false tax return, crimes related to the theft of thousands of …
What. Utter. Bullshit.
She stole ~40M from her employer, you don't give her a slap on the wrist, make her give back *some* of the ill gotten gains, & then throw her in prison for a few years, you freeze all her assetts, sieze them, liquidate them, give the money back to her employer, & then force her to work off the rest as part of a prison chain gang doing hard labour until it's all paid off.
Making her give back merely *some* of the goodies she acquired with the stolen money means it's ok to do the crime as long as you line a few of the right palms/pockets with a proper tithe to make the Scales of Justice get bent in your favour. Fuck that for a lark.
Justice isn't justice if the rich get treated differently just because they have fat sacks of cash to spread around.
"one count of wire fraud and one count of filing a false tax return..."
$40 million is a "grand theft" yet they press her for taxes and misrepresentation (fraud).
Either Yale didn't want to press the issue... or they wrote her a "Get out of [major] jail free" card...and I'm only left to assume that ' treating her femininely' was one of the reasons. They say up to 20 years but you bet she gets around 5, maybe less?
Even Al Capone was finally got on tax evasion. Prosecutors will go for the easiest wins. In the US those seem to be tax evasion and wire fraud. Wire fraud seems to be a peculiarly US offence (presumably the easiest variety to prosecute) but even in the UK fraud would fit the circumstances better. Theft would be picking up an iPad that somebody else had bought. In this case the iPads etc were simply vehicles for fraudulently moving money from Yale's bank account to hers and her associates'.
I don't see why you think Yale wrote her a get out of jail free card. It must have been their actions that lead to the prosecution and provided the evidence. A get out of jail free card would be to have her sign an NDA and quit, not report her to the authorities.
"In this case the iPads etc were simply vehicles for fraudulently moving money from Yale's bank account to hers and her associates'."
Isn't that the theft component though? Yes, the iPads were the "vehicle" that enabled her to steal $millions. The oddest thing about this case are the amounts involved and the sheer length of time before it was noticed! If she'd just gone for enough for a nicer car and an extra annual skiing holiday, instead of being greedy, she might have got away with it for years longer, or maybe never have been caught.
>very embarrassing for an Ivy League university that has a business school churning out MBAs.
If she had done this the clever way, redirecting all the orders through a company her partner owns and marking stuff up 200% 'cos it's enterprise grade' then regularly retiring kit, selling it for pennies to another company her partner owns and replacing it.
If she had done this properly she would be getting donation requests and being put on committees
"internal financial controls"
$40 MM gross in 8.5 years (!?) is $13,000 per day, including weekends. Since her signing authority was $10,000, that's more than one purchase order per day. Either somebody else in controls was in on the scam, or they have no controls worth the name.
Think about how many Surfaces and/or iPads you can get for $13,000 *per day*. She needed the multiple cars to pick up stuff at the loading dock (the boot has to be empty at pickup), warehouse it in situ, and later drive the stuff out to the distributors. The number of widgets she was moving boggles the mind. At most places I have worked, the loading dock is a world of its own, but somebody should have noticed the daily pickups by this one lady, when most people visit almost never.
> ...that's more than one purchase order per day. Either somebody else in controls was in on the scam,...
I worked in university when we had to *walk* any large PO from desk to desk for accounting and issuing. You could not flood that system.
But toward the end of my employment there was a mini-scandal of poor data. Higher-ups wanted answers which could not reasonably be teased out of the mountain of paper. A 6-month plan for total automation was proposed and finally (took over 4 years, depended on old versions of MS IE) implemented. Just as I was leaving, couple years on this full-auto system, some facts emerged. You could submit max-authority POs all day long, to any vendor, without any human oversight. Some mid-level workers apparently did (all day long); others frauded only half-days (I knew one, after she suddenly 'left').
Ford Motor Company had similar issues after WWII. Henry kept all the records in his vest pockets. When he was eased-out, nobody knew where the money was coming or going. Bob MacNamara was one of the "WhizKids" who took over the upper management. While it was not MS IE on PCs, they did use all the data-card gear of the times. And still never quite caught-up with the needs of a monster organization.
If the operation is making money, as Ford did to 1930, you don't need controls. If the operation is losing money, as Ford did 1930 onward ($10M a month in 1944, $185M in today money), controls tell you that but are not much help in turning the situation around.
"Since her signing authority was $10,000"
One assumes she was ordering just a few iPads at a time, at maybe $1,000 each...so, if each order was for say, $6,000, she could sign this off without requiring authorisation?
She could then do this multiple times, using different PO numbers, even with the same firms and they wouldn't bat an eyelid, coz they had a highly regarded University, buying from them.
And if she was buying for a "Department" that she could claim had maybe 50-100 staff, then her ruse could easily work...
Mind you: ANY Finance Director who is buying IT worth more than $5 million ($40m divided by 8 years) per annum must surely have been questioned by the "Board of Governors" at some point...?
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I'll bet she doesn't have even half the $40 million. Not because she's spent it all on hookers and blow, but because there are some others involved who she's protecting. Who have already set up an offshore account for her in exchange for her silence while she spends a few years behind bars in a country club prison. I mean, stealing from Yale is about as white collar as a crime gets!
What are the odds that during 8 years no one who worked at Yale found out about this? About someone who must have been filing several $10K POs per work day to steal that much in that timespan! Of course they did, she just gave them a piece of the action in exchange for their silence.
The way these cases should work is the judge says "I sentence you to 30 years in prison, with one year suspended for every 4% of the loot you help us recover or can prove has been spent". She won't protect her co-conspirators if she's looking at being on social security by the time she gets out!
There might have been (i.e. someone without criminal experience like her wouldn't negotiate the best deal for herself) but new in box hardware that isn't reported stolen could be sold at retail for list price same as any other third party seller of iPads and Surfaces. This isn't like stuff that is or is likely to be reported stolen that can only be sold at a massive discount.
Whoever she sold them to was probably selling them at very close to the standard wholesale price to retailers. How much of a cut they were making, who knows, but squealing on that person/people should be part of the process of reducing her sentence by tracing where the money went. If she can show she was paid let's say 75% of retail for everything, then she's got credit for $10 million in my hypothetical sentencing reduction when she gives up everything she knows about her fence.
You forget that what the University LOST is what counts - they were paying thru the nose for her to stash loot in her own accounts - it's irrelevant what she 'made' out of the transaction ! I think most crimes like this start out small, and when they are not caught the perpetrator simply can't help going for more & more.
Sure, but when you are asking where the $40m went
The actual cash went to Apple and Microsoft or their distributors in exchange for the fondleslabs they delivered to the university.
And the reason why the thief doesn't have $40m in the bank, part of the reason is that they were sold for less than $40m because otherwise the buyers would just get them from the official channels and part of the reason is that there are transaction costs, shipping costs, etc, associated with selling them.
Perhaps, this is an admission of other arms inside Yale being complicit in the matter and they do not want the story to spread.
ERPs and procurement scams do little IMO for transparency and everything for someone who knows how to work the system to their advantage.
I have seen cases where secretaries to very senior staff who would routinely handle lots of post, have abused that position to acquire goods on the company's books. Caught and dealt with - eventually.
And well she should. All that money and no taste, tsk tsk. A G550 and a Range Rover ? Did you even drive into the woods one day ?
The E450A is very much more in your comfort zone, I'll give you that, but buying two Cadillac Escalade ? What en Earth were you thinking lady ? Did you at least give one to someone ? You already had a shoebox, you didn't need to buy two more.
No, all that money and she buys practically nothing but shitty SUVs.
She definitely deserves 20 years.
There's pictures of the various "bling" that she bought, such as designer clothes, shoes and handbags. Really tacky stuff. It's on the Daily Fail website if you fancy a laugh.
You do have to pay USA tax on illegal income, the IRS say this isn't an admission of guilt (because that would violate your 5th amendment rights).
They even allow deductions, so you can probably charge mileage for your getaway car.
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