FOR IMMEDIATE RELEASE:
MONDAY - April 19, 2010
LAST DEFENDANT PLEADS GUILTY TO A $23 MILLION
MAIL FRAUD AND MONEY LAUNDERING SCHEME
RALEIGH - United States Attorney George E.B. Holding announced that in federal court March 17, 2010, MARIO EASEVOLI, 33, of Tucson, Arizona, pled guilty before United States District Judge Terrence C. Boyle to charges involving a mail fraud and money laundering scheme that brought a loss of over $22 million to Cisco Systems, Inc. (Cisco), a leader in the design and manufacturing of computer network routers and other equipment.
A Federal Grand Jury returned a Criminal Indictment on September 9, 2009. EASEVOLI pled guilty to conspiring to commit mail fraud, in violation of Title 18, United States Code, Section 1349, and conspiring to commit money laundering, in violation of Title 18, United State Code, Section 1956(h).
Cisco, a San Jose, California-based company, offers SMARTnet, a contract service covering Cisco equipment, that allows end users to obtain technical support and advance replacement parts. Advance replacement allows end users to obtain replacement parts immediately without having to return the failed or defective part first.SMARTnet contracts are not transferable and benefit the original end user only.However, if the covered product is transferred to another party, the new owner has the option to register the part with Cisco to obtain a new SMARTnet contract.
EASEVOLI and his wife, Jennifer Easevoli, also known as Jennifer Leigh Harmon, were doing business as Synergy Communications Corporation (Synergy). EASEVOLI was founder and president of Synergy; Jennifer Easevoli, served as vice president of the company, and co-defendant, Jason Allan Conway, was an agent and employee. According to the indictment, from approximately January, 2003, to July, 2005, the defendants submitted fraudulent claims to Cisco in order to receive replacement parts under SMARTnet contract. They then sold these replacement parts on the grey market to downstream customers, depositing the payments into a Synergy bank account. After creating more than 50 fictitious company names and 35 fictitious personal names, the defendants instructed Cisco to ship replacement parts to private mailboxes the defendants obtained at UPS stores, as well as residential and commercial addresses in seven states.
At sentencing, scheduled for July 9, 2010, EASEVOLI faces up to 20 years imprisonment followed by up to three years of supervised release.
Both Conway and Jennifer Easevoli have pled guilty to one court of conspiring to commit money laundering on December 16, 2009, and January 20, 2010, respectively. Additionally, Conway pled guilty to one court of conspiring to commit mail fraud.
Mr. Holding commented, “In order for our businesses to remain profitable and successful they, and we as federal investigators and prosecutors, must remain vigilant against all types of fraud. We look forward to sentencing and await the Court’s decision on how to respond to this fraud.”
Special Agent in Charge IRS-CI Jeannine A. Hammett commented,
“IRS-CI is committed to the prosecution of individuals who commit financial crimes. The underground, untaxed economy harms the entire nation's economic strength."
Service-Criminal Investigations, and the United States Postal Inspection Service. Assistant United States Attorney Thomas Murphy represented the government.
News releases are available on the U. S. Attorney’s web page at www.usdoj.gov/usao/nce within 48 hours of release.