Tech company accused of defrauding schools, government

On Behalf of | Dec 20, 2019 | Firm News, White Collar Crimes

One New York technology company owner is facing criminal charges after allegedly failing to provide computer equipment and internet service to the students attending Catholic schools in Brooklyn. The head of AutoExec Computer Systems in Long Island allegedly billed a federal program to aid underprivileged schools in enhancing their technical needs for hundreds of thousands of dollars of work that was not performed. Called the E-rate program, the initiative is designed to help libraries and schools to get better access to the internet, especially for children in poverty who are less likely to have reliable broadband service at home.

The 68-year-old man is being accused of mail fraud and wire fraud in the case. Federal prosecutors accuse him of overbilling the program by $426,000 for incomplete or undone services. In order for schools to participate in the program, they must contract with a private vendor to upgrade their internet services and provide computers, routers and other devices. The vendors must then report to the government about their compliance with the rules of the program and the materials they provided to the schools and libraries. The program covers up to 90% of costs.

The company is accused of making E-rate program contracts with 26 different schools in the Catholic Diocese of Brooklyn. However, prosecutors allege that 18 schools received substandard or unapproved equipment that was cheaper to purchase while eight schools received no equipment or services whatsoever. The man faces a 20-year prison sentence for each fraud charge if he is convicted.

Accusations of white-collar crime can destroy businesses and lives, and it is all too easy for innocent bystanders to take the blame for someone else’s fraudulent conduct. People facing investigation or criminal charges for fraud, embezzlement or other misconduct may consult with a criminal defense attorney to work to avoid a conviction.