FORMER XEROX EMPLOYEE ADMITS TO KICKBACK SCHEME

[Anonymous]

FORMER XEROX EMPLOYEE ADMITS TO KICKBACK SCHEME
Rochester, N.Y. —A forklift mechanic has admitted his part in a kickback scheme that defrauded his former employer, Xerox, out of millions of dollars.John Jarnot could have faced up to 20 years in prison, but he cut a deal on Wednesday, pleading guilty and agreeing to cooperate with prosecutors in their case against 10 men accused of defrauding Xerox.The former employee of 20 years worked as a mechanic in the forklift maintenance department of Xerox. Authorities say he and other workers were in cahoots with the owners of an auto repair shop on Ridge Road in Brockport.

Clarkson Auto Electric contracted with Xerox to service the company’s forklifts at its factories and warehouses in Webster.According to authorities, from 2002 to 2007, Clarkson Auto Electric intentionally billed Xerox for parts and repairs that were never provided, at an estimated loss to Xerox of $4 million. The owners of the repair shop, Anthony and Gerald Fretto and Matthew LaVilla, were indicted on mail fraud and money laundering charges in June.

Jarnot stated in court that he placed phony orders for forklift parts and gave Anthony Fretto used parts only to have them shipped back in new packaging as though they’d been replaced. Court documents state Jarnot received kickbacks in return in the form of car and snowmobile parts, tools, cash and other items.At his May sentencing, he faces three years and five months in prison, but could receive significantly less time in prison if he provides substantive assistance to the government in its case.He’ll also have to make restitution of $800,000.

[Author]

February 16, 2011 at 11:58 AM