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Former vice of Netflix The president of IT operations was convicted of bribing technology vendors to award contracts with Netflix, the U.S. Department of Justice. he announced Friday. The former VP’s illegal scheme forced colleagues to use a variety of products, including “serious” performance issues and Netflix employees opposed one because they preferred another product that the company was paying for, the DOJ said.
Former Netflix executive Michael Kail was convicted by a federal jury of wire fraud, mail fraud and money laundering. He used his position for years Netflix to accept contracts for sellers who were given bribes and setbacks, the DOJ’s announcement said:
As Netflix’s vice president of IT Operations, Kail approved contracts to buy IT products and services from smaller retailers and allowed their payments. Evidence showed that Kail accepted bribes in the “bounces” of nine technology companies that offered products or services to Netflix. In exchange, Kail agreed to millions of dollars in contracts for goods and services to be provided to Netflix. Kail eventually received $ 500,000 and share options from these outside companies. He used the payments to pay for personal expenses and to buy a home in Los Gatos, California, on behalf of the family trust.
“Michael Kail had tremendous power to accept valuable Netflix contracts with small high-tech vendors, and he exchanged that process for himself to get his money and shares back,” said U.S. actress lawyer Stephanie Hinds.
Kail was vice president of IT operations for Netflix from November 2011 to August 2014, when he switched to a job at Yahoo. Netflix he sued Kail In November 2014 in the California High Court in Santa Clara County, but the case was dropped a year later.
It was Kail prosecuted 2018 for 19 wire scams, three mail scams and seven money laundering charges. It was Kail they have been found guilty In 28 of the 29 charges, the jury found him guilty of a wire fraud. The jury also found that Kail’s Los Gatos house, which had been bought with money laundered, could have been lost to the government. The case occurred in the U.S. District Court for Northern California.
“Kail has a maximum sentence of twenty years in prison and a $ 250,000 fine, or twice the gross profit of Netflix or double the gross loss of Netflix, whichever is greater, for each sentence of wire or mail fraud and a ten-year prison sentence. And a $ 250,000 fine, money. for each count of the laundering sentence, ”the DOJ said. A hearing is scheduled for September 14, 2021.
Kail set up a corporation to receive bribes from Netflix contractors, the DOJ said.
“To facilitate payments, the trial evidence showed that Kail created and controlled a limited liability corporation called Unix Mercenary, LLC,” the DOJ said. “Founded on February 7, 2012, Unix Mercenary had no employees and no business location. Kail was the sole signatory of its bank accounts.”
Two days before the company was registered, “Kail signed a Sales Representation Agreement to receive payments from Netenrich, Inc., a 12 percent of Netenrich’s billing to Netflix for its contract to provide Netflix with staff and IT services.” DOJ-k. . “Later, in 2012, Kail began receiving 15% of all turnover from VistaraIT, LLC, the entire Netenrich company, received by Netflix. From 2012 to 2014, Netenrich paid approximately $ 269,986 to Unix Mercenary, and VistaraIT paid Unix Mercenary He paid approximately $ 177,863. Payments stopped in mid-2014 when Kail left Netflix. “
Kail backed deals with Platfora, Sumo Logic, Netskope, Maginatics, ElasticBox and Numerify vendors, the DOJ said. For example, Kail “became a consultant and received options for shares in Sumo Logic” in June 2012 and then “authorized and signed a dealership agreement between Netflix and Sumo Logic on behalf of Netflix,” the DOJ said, adding:
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