$4M Supplies Fraud Unveiled by FBI

$4M Supplies Fraud Unveiled by FBI

The FBI now believes a multi-million dollar scam to swindle ink and toner printer cartridges is far more widespread than they first thought.

The investigation over the $4 million purchasing swindle in the Las Vegas Valley Water District initially focused on the activities of just one person, JJ McCain, a popular, hard-working employee at the district. Now authorities suspect she had outside help exploiting a weakness in the district’s financial practices.

It’s been alleged that McCain started ordering $40,000 worth of printer cartridges every month back in 2012, but by December 2015, it was $40,000 per week .

She allegedly found a way to hide her purchases of office supplies which were then allegedly shipped out of state and presumably re-sold. McCain claimed that she discovered a method to conceal her conduct of purchasing, shipping out and re-selling of office supplies. It is now suspected she had outside collaborators who assisted her in exploiting the loopholes within the financial activities of the water district.

According to tonernews.com McCain told FBI agents she was enticed into the scheme by someone inside Staples—the company that sold more than $4.3 million worth of suspicious ink to the water district.

Las Vegas City Councilman Bob Coffin, who also sits on the Board of Directors for the Southern Nevada Water Authority (SNWA) says he was stunned to first learn of the scandal from the media. “I am disappointed I didn’t know about this until April when I got a phone call from the media. There is a possibility that other people are involved, other companies maybe. The retailer that was selling the toner to this individual, to us, can they explain that they didn’t know what was going on? I wonder about that. That employee, I understand, is gone from Staples.”

Internal records from Staples, however, show that the company was well aware of unusual sales activity. Compared with all other office supplies purchased by the district, the $1.5 million spent on ink in 2015 alone certainly stood out.

To date, no charges have been filed and the water district expects to take back around 70% of its loss through its insurance policies. The rest may be pursued by taking civil action.

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Please contact Violien Wu, Head of News & Editorial, via violien.wu@iRecyclingTimes.com

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