United States Attorney for the Eastern District of Pennsylvania Announces Participation in National Money Mule Initiative; Obtains Three Civil Injunctions Against Alleged Money Mules Involved in Lottery Scams
PHILADELPHIA – United States Attorney William M. McSwain announced that Jerel Andre Williams, 37, of Mansfield, Texas, was charged today by Information with 9 counts of mail fraud and 2 counts of filing a false tax return.
The Information alleges that the defendant defrauded Cisco Systems Inc. (“Cisco”), by engaging in a sophisticated warranty fraud scheme. The charges state that Williams and a co-schemer obtained serial numbers to products manufactured by Cisco. He then allegedly utilized false email addresses and false names to submit false warranty claims to Cisco using those serial numbers, pretending to own Cisco products that were under warranty and supposedly not working. Next, Williams provided Cisco customer service representatives with descriptions of the non-existent defects that he knew could not be solved by troubleshooting and would therefore require replacement with new products. Cisco shipped the replacement products to Williams and his co-schemer on the expectation that the defective products would be returned.
The charges allege that Williams and his co-schemer successfully obtained 157 warranty replacement products from Cisco in this manner, each with a retail value of between $3,693 and $34,500. They had the products shipped to addresses throughout the United States, including in Wynnewood, Pennsylvania; Cherry Hill, New Jersey; Wilmington, Delaware; Las Vegas, Nevada; Henderson, Nevada; La Jolla, California; San Diego, California; Arlington, Texas; Dallas, Texas; and Fort Worth, Texas. Williams and his co-schemer then traveled to these addresses, picked up the products, and resold them to computer resellers. Williams allegedly failed to return the supposedly defective Cisco products, despite his promises to do so -- because he never owned them in the first place.
In addition to operating this fraud scheme, the Information also alleges that the defendant filed false tax returns for tax years 2015 and 2016 in which he underreported his gross receipts by $284,741 and $349,177, respectively.
Williams faces a total maximum sentence of 193 years’ incarceration, a five-year period of supervised release, and a fine of $2,750,000.
“Warranties are designed to make honest consumers whole by replacing faulty products, not to be exploited by scammers looking to turn an illegal profit,” said U.S. Attorney McSwain. “Williams allegedly engaged in a sophisticated, nationwide warranty fraud scheme worth hundreds of thousands of dollars. I would like to thank the FBI and IRS for their dedication and partnership in this matter.”
“All income, whether it be from legal or illegal sources, is taxable,” said Michael Montanez, Acting Special Agent in Charge of IRS-Criminal Investigation. “Our Agents have both law enforcement and financial investigation expertise that uniquely qualifies us to assist with these types of cases by following the illegally obtained proceeds.”
The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation Division, and is being prosecuted by Assistant United States Attorney Michael S. Lowe.
An Indictment, Information, or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.