Former Employee Pleads Guilty to Defrauding Exxon Mobil of More than $1 Million
|Sept. 20, 2013|
HOUSTON – Garry W. Arnold, of Dayton, has pleaded guilty to defrauding Exxon Mobil, his former employer, and causing a loss of more than $1 million, announced United States Attorney Kenneth Magidson.
Arnold was employed by the Exxon Mobil Chemical Company from 2004 through 2010 at the company’s Baytown Olefins Plant. His job responsibilities included overseeing the maintenance and repair of numerous large furnaces located at the plant, including ordering replacement parts and coordinating the purchase, delivery and installation of these parts.
Arnold also controlled and was part owner of Metal Blinds Unlimited Inc. During the relevant time period, Metal Blinds had minimal legitimate business operations, had no employees other than Arnold himself and it operated out of his residence.
Beginning in or around January 2004 and continuing through April 2010, Arnold carried out a fraudulent invoicing scheme which caused Exxon to pay at least $1 million for furnace parts and fabrication services that were never provided, were provided with materials already owned by Exxon or for which it paid an excessive amount. Arnold and another person shared the proceeds of the scheme by having Exxon send the payment checks to a company the other person owned, after which the other person caused that company to make payments to a sham corporation owned by Arnold. The other individual also made payments to Arnold for legitimate work done by One Source Industrial for Exxon and other clients, again by making regular payments by check to Metal Blinds.
In total, the scheme resulted in Exxon creating approximately 78 purchase orders and paying at least $1 million to One Source Industrial for work purportedly done by Metal Blinds. Arnold received at least $1 million in association with these invoices through his sham corporation. The other company also paid approximately $310,253.20 to Arnold as part of the concealed profit-sharing agreement.
U.S. District Judge Ewing Werlein Jr., who accepted Garza’s plea today, has set sentencing for Dec. 13, 2013. At that time, he faces a maximum penalty of 20 years in federal prison and a $250,000 fine or twice the pecuniary gain or loss.
The case is being investigated by the U.S. Postal Inspection Service and prosecuted by Assistant U.S. Attorney John Pearson.