The FBI has arrested an IT contractor at the City of Newark, New Jersey for allegedly stealing $10m-worth of networking parts from Cisco.
Michael Kyereme, 40, of Piscataway, New Jersey has been charged for mail fraud after he allegedly ordered new Cisco parts which were not needed by the city.
The FBI said he sold the parts after conning Cisco using an immediate replacement part contract held by the City of Newark.
Kyereme was an independent contractor hired to provide information technology support to the City of Newark.
Kyereme provided both technical support to Newark employees and network troubleshooting to the city.
If it was determined that a computer-related problem could not be solved without outside assistance or a replacement part, Kyereme was authorised to contact Cisco Systems for technical assistance and, if necessary, to request a replacement part.
It is alleged that Kyereme would falsely claim that certain Cisco parts in the City of Newark's computer systems were malfunctioning and needed replacing.
In response to these numerous requests, Cisco sent approximately 280 replacement parts over a sustained period to Kyereme, the FBI said.
Instead of installing these parts in the City of Newark's computer system, Kyereme would keep the parts and sell them to a computer reseller, while often returning “faulty” parts of a lesser commercial value to Cisco, the charge sheet states.
In all, Kyereme failed to return 148 of the allegedly inoperable parts to Cisco, and of the approximately 132 allegedly inoperable parts he did return, only 33 of those parts matched the type of part originally sent by Cisco to Kyereme.
The FBI is involved in a similar case in Boston, and the agency is now investigating whether Cisco is the subject of organised and/or concerted scams by fraudsters.
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