Alameda County Resident Sentenced To 15 Months Of Confinement For Scheme To Defraud Networking Equipment Manufacturer
Defendant Sentenced to Prison and Home Confinement for Scheme Involving Replacement Parts
SAN JOSE - Ferdinand Pasion Arafiles, a/k/a Dennis Arafiles, was sentenced today to 10 months in prison, 5 months of home confinement, and ordered to pay $100,000 in restitution for his role in scheme to defraud a Bay Area manufacturer and seller of networking equipment, announced United States Attorney Alex G. Tse and Federal Bureau of Investigation Special Agent in Charge John F. Bennett. The sentence was handed down by the Honorable Edward J. Davila, U.S. District Judge.
Arafiles, 50, of Alameda County, pleaded guilty on December 11, 2017, to wire fraud. Arafiles was an employee of a Bay Area public school district. According to his plea agreement, Arafiles admitted that beginning October of 2009 until February 2016, he devised a plan to take advantage of the relationship between the school district and a leading networking equipment and services corporation (the “Corporation”). Specifically, Arafiles maintained access to the Corporation’s warranty contract and service program for the school district and used that access to order, receive, and then sell, replacement computer parts to which he was not entitled.
In the plea agreement, Arafiles acknowledged he created multiple email accounts, including variations on the name of the school district that employed him, and used those email accounts to create user accounts with the Corporation. He then made service requests on the Corporation’s customer support website. Using those email accounts and fraudulent identities, Arafiles instructed the Corporation to send “replacement” parts to designated addresses, including Arafiles’s personal residence in Alameda County. Arafiles understood that the Corporation required the return of failed or defective parts, so he returned bogus parts that contained forged or altered serial number labels. Arafiles also posted for sale and sold on internet market places some of the parts he fraudulently obtained from the Corporation.
A federal grand jury indicted Arafiles on June 23, 2016. In sum, Arafiles was charged with five counts each of wire fraud, in violation of 18 U.S.C. § 1343; interstate transportation of stolen property, in violation of 18 U.S.C. § 2314; and mail fraud, in violation of 18 U.S.C. § 1341.
In addition to the prison term, Judge Davila sentenced the defendant to a three-year period of supervised release and $100,000 in restitution. The defendant will begin serving his prison term on March 13, 2019.
Assistant U.S. Attorney Jeff Schenk is prosecuting the case with the assistance of Laurie Worthen and Tong Zhang. The prosecution was the result of an investigation by the FBI.