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A con artist who got some of the biggest tech companies in the world to send him replacement equipment has been given seven years and eight months in a US prison. Justin David May, age 31, used stolen hardware serial numbers, a lot of fake websites and online identities, social engineering, and a network of friends to scam Cisco out of almost $3.5 million in hardware in just one year.
Microsoft lost 139 Surface laptops worth $364,761 to the thief. Lenovo US also lost 193 replacement hard drives worth $143,000, and APC (formerly American Power Conversion) lost a few uninterruptible power supplies. May admitted to 42 counts of mail fraud, 10 counts of laundering money, three counts of transporting goods obtained through fraud across state lines, and two counts of not paying taxes.
“May and his accomplices broke the warranty system, which is meant to protect honest customers. “They made money from this complicated scheme while cheating these companies and the federal government,” said Michael Driscoll, who is in charge of the FBI’s Philadelphia division.
“Thanks to the hard work and teamwork of the FBI and IRS, this sentencing sends a message to people who try to make money through fraud and deception that there are serious consequences for this kind of behavior.”
In the biggest scam against Cisco, which started in April 2016, court documents [PDF] filed in a federal district court in Pennsylvania say that May and his group set up web domains and email addresses to look like cisco.com user IDs and stole serial numbers from real equipment.
Then, they used these details to trick Cisco staff into sending replacements for equipment the thieves didn’t actually own, like a Cisco Catalyst 3850-48P-E Switch worth about $21,000 at the time and two Cisco ASR 9001 routers worth more than $100,000 for the pair. So, the fraudsters got away with the new gear, and the tech giant never saw the supposed broken equipment that was being replaced.
Problems with systems
It looks like the same scam worked well for both Microsoft and Lenovo. In the court documents, it says that May was good at making up problems that couldn’t be fixed through a remote connection or software update and seemed serious enough to need a new unit. Also, his team used digital tools to change pictures of what they said was their equipment and serial numbers to trick support staff.
Once UPS or FedEx delivered the hardware, the companies never got the broken kit back because it never existed. In the meantime, the packages were picked up, sold on eBay and other second-hand sites, and the money was kept. In the case of Microsoft, some of the hardware was shipped to Singapore to be sold there.
These thieves weren’t very smart. May deposited some checks into his own account, but he also went to check-cashing shops to get cash. The Feds say that some of this money was used to buy a 2017 BMW Coupe, and they found a lot of cash at his house.
The key to the scam seems to have been sticking with it and making it fit the person. It took hundreds of requests for help to get the kit, and the success rate was higher than expected. At least 252 of the 368 false warranty claims made by Cisco customers were accepted, while only 23 of the 216 ThinkPad hard drive warranty claims made by Lenovo customers were denied.
“Warranties are meant to make customers whole by replacing broken products.” “They are not meant to be used by scammers who want to make money illegally,” said acting US attorney Jennifer Williams.
“Warranty fraud is not a crime with no victims. Instead, companies that employ thousands of people stand to lose millions of dollars, which is what happened in this case. The defendant’s plan did real damage, so he will now spend many years in prison as punishment for what he did.
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