White Collar Crime News

Fry’s Electronic’s Executive charged with fraud December 24, 2008

What is it with electronics stores?  I guess Ausaf Umar Siddiqui didn’t get the hint from Crazy Eddie.  The Feds allege that defrauded Fry’s Electronics and its vendors of over $65 million over the past few years.  He allegedly demanded large commissions from a handful of companies in exchange for prominent placement at the stores. 

The private company is run by a small family group.  As a 20 year veteran of the company, he was apparently trusted.  For some reason, the company permitted him to run his own independent company, PC International.  The headquarters for his company?  His Palo Alto condo.  You think that would have tipped someone off that something isn’t right?

This is a very interesting story to follow for several reasons.  Apparently, an IRS agent was doing some dumpster diving at the homes or business of some of the vendors for Fry’s.  The agent was able to recover incriminating emails, although it is unknown as to why these emails were printed out and then thrown out without being shredded.  Another reason to watch the case is to see if anyone else will be charged.   If the executive from these other companies agree to testify, they will probably not be charged.  A lot depends on how their attorneys handle the case.

Finally, the alleged motivation for all of this was gambling debt.  While everyone knows that there are plenty of people that have gambling problems, the extent to which people will go to satisfy their urges and debts are rarely discussed.  I have represented several clients who have blown $100,000’s on gambling.  Of course, these clients didn’t have this money just lying around; they had to “obtain” the money from one illegal means or the other.  Eventually, it comes crashing down on them and it could be really tough to help dig them out of the hole they created for themselves.  Luckily, I’ve help many people do just that without them ever being arrested.

For more info, check out the detailed story here.