By Richi Jennings
. August 16, 2010. An Apple employee has been accused of leaking company secrets to Asian accessory manufacturers. Paul Shin Devine's allegedly-dodgy "consulting services" got him fingered by the FBI and IRS -- and Apple is none too happy, either. Update: he pleads not-guilty. In IT Blogwatch, bloggers look east.
Your humble blogwatcher curated these bloggy bits for your entertainment. Not to mention Galactic Inbox...
(AAPL) Elizabeth Heichler and Grant Gross enumerate the allegations:
Devine was accused of accepting $1 million in kickbacks from half a dozen Asian suppliers of iPhone and iPod accessories. ... Devine allegedly was paid for sharing confidential Apple information with contractors that helped them win Apple business on favorable terms. ... He allegedly shared the kickbacks with Andrew Ang ... who the indictment charges helped broker deals. Bill Ray guns for more:
In a federal indictment ... Devine is charged with ... wire fraud ... money laundering ... wire fraud conspiracy and ... monetary transactions with criminally derived property. ... Apple Friday sued Devine in ... a civil suit.
The kickbacks ... [were] in exchange for confidential information about what Cupertino would be buying [it is alleged]. ... We don't know exactly what that information was ... [but] information about upcoming models, competing bids and how much Apple expected to pay for items ... would be extremely valuable on the negotiating table. Daniel Eran Dilger cleans up the loose ends:
According to the filing Ang and Devine worked together to route money around the world ... to hide its source. ... The Wall Street Journal names three of the companies involved as Kaedar ... Cresyn ... and Jin Li ... of China, South Korea and Singapore.
The funds were said to be laundered through a series of accounts in US and foreign banks, with the payments identified as "samples". ... Devine reportedly opened accounts to accept payments under both his and his wife's names. ... The case was put together by the US Federal Bureau of Investigation and Internal Revenue Service. Nick Farrell speaks of 'spy vs. spy':
Apple has long worked hard to maintain secrecy in order to keep competitors guessing ... but the case also highlights threats the company faces in working with its own partners ... Whether the case will have an effect upon the product prototype leaks ... that have resulted in regular new explosions of media attention remains to be seen.
Apple's inquisitors were reading through Devine's email accounts when they found evidence that he had been helping some suppliers gain an edge. And Stewart Meagher has more on that:
Apple apparently rumbled the employee when it snooped on e-mails ... one of which detailed a 'consulting services agreement' which gave the Asian companies access to Apple product roadmaps and sales forecasts in exchange for monthly payments of $6,000. But Tony Bradley sees a cautionary tale here:
Device allegedly coached a number of companies ... on how to get into Apple's good books and received payments of more then $500,000.
Unethical employees quickly find ways to exploit the honor system. ... Had Apple been more proactive about enforcing corporate policy and monitoring employee communications ... Devine's actions could have been detected and prevented much earlier. And Finally... Galactic Inbox: an HTML5 Game
Implementing tools to automate monitoring and proactively protect corporate data does not necessarily mean that the company has to act as Big Brother or spy on every action of employees. ... [But such] tools quickly detect and identify suspicious behavior before it becomes a federal case over $1 million in kickbacks.
[hat tip: Mike Elgan]
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| || ||Richi Jennings is an independent analyst/consultant, specializing in blogging, email, and security. A cross-functional IT geek since 1985, you can follow him as @richi on Twitter, pretend to be richij's friend on Facebook, or just use good old email: firstname.lastname@example.org. |