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Former supply chain buyer's fraud and kickbacks cost Apple $10M

A former Apple employee has allegedly defrauded Apple out of $10 million, according to federal authorities, by using his position as a supply chain buyer to obtain kickbacks and to make Apple pay for undelivered goods and services.

Charged on Friday, Dhirendra Prasad was with Apple between 2008 and 2018, and spent most of his time working as a buyer as part of its "Global Service Supply Chain," prosecutors and the Internal Revenue Service say. In his position working with vendors, Prasad is said to have "exploited his position by engaging in multiple different schemes to defraud Apple."

A federal press release seen by Silicon Valley says the list of activities includes "taking kickbacks, stealing parts, and causing Apple to pay for items and services it never received." The five charges include counts of fraud, money laundering, and tax evasion, with each carrying maximum sentences of five to 20 years.

The activities are said to have resulted in losses totaling more than $10 million for Apple.

Prasad is set to make his first court appearance on the matter in the U.S. District Court in San Jose on Thursday. The federal government has already been given permission by the court to seize $5 million in cash and property from Prasad, with the intention to keep the assets as proceeds of crime.

Two other men based in California have also been linked to the scheme, authorities claim, with the pair owning companies that sold to Apple, as well as conspiring with Prasad over fraud and money laundering. Both were charged in separate federal cases, and authorities claim they have both "admitted their involvement."