Apple Exec Pleads Not Guilty in $1M Kickback Scheme

Prosecutors: Manager passed secret info on to suppliers

By Greg Wilson
|  Tuesday, Aug 17, 2010  |  Updated 12:30 PM EDT
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368322 09: A car passes by the sign in front of the Apple offices Computer April 21, 2000 in Cupertino, CA. The company is one of many computer technology corporations situated in Silicon Valley. (Photo by David McNew/ Newsmakers).

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The Apple executive accused of taking $1 million in kickbacks from Asian suppliers pleaded not guilty in federal court Tuesday.

Paul Shin Devine, 37, of Sunnyvale, Calif., a global supply manager for th tech giant, was arrested on Friday on charges of wire fraud, wire fraud conspiracy and money laundering. He is accused of taking the cash under the table from suppliers of iPod and iPhone parts in exchange for confidential information. The suppliers allegedly used the information to bargain for lucrative contracts with Apple.

Devine received payments through a series of foreign and domestic bank accounts and one front company, according to prosecutors. He would also have bank transfers wired to his wife’s name, prosecutors said.

One supplier is Andrew Ang, a Singapore national whose whereabouts are unknown. Apple learned of the scheme through a review of Devine's work e-mails.

“We have zero tolerance for dishonest behavior inside or outside the company,” Apple spokesman Steve Dowling said.

Devine made an annual salary of $614,000 and $51,076 in bonuses, along with 4,500 Apple stock options and 900 shares of restricted stock over a five-year span, according to legal documents filed by Apple, Bloomberg reported.

Device could face a 20-year prison sentence on each of the three counts he is charged with. He entered his plea in federal court in San Jose.

Selected Reading: MSNBC, Bloomberg, Techmeme.

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