Apple Manager Accused Of Kickbacks Bail Hearing Today

August 18, 2010 12:56 AM EDT

The manager accused of taking kickbacks from suppliers of parts to Apple, Inc. is scheduled to be in court today at 1:30 Pacific Time for a bail hearing.

Paul Shin Devine, a supply manager for the Cupertino, Calif.-based Apple, pled not guilty Monday to charges of wire fraud, wire fraud conspiracy, money laundering and monetary transactions with property from criminal activity. Devine is accused of taking kickbacks from suppliers to Apple in exchange for information that would enable them to negotiate more favorable contracts with Apple.

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Another defendant in the suit, Andrew Ang, of Singapore, has not been arrested yet, said Department of Justice Spokesman Jack Gillund. It is not clear yet what bail the court will ask for.

Apple Computer filed a civil complaint on top of the criminal charges. Among the accusations in the Apple complaint against Devine are fraud, violations of the Racketeer Influenced and Corrupt Organizations Act, breach of contract and fiduciary duty.

Apple's suit says that on more than a dozen different occasions Devine emailed confidential sales forecast information to Cresyn, a South Korean company. Cresyn was a supplier of headsets to Apple.

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The suit outlines a long history of payments to Devine, some of them to an account in his wife's name or that of a company he set up called CPK Engineering. The payments were disguised by being listed as "consulting services," as well as by being kept under $10,000 - the threshold for banks to report the source of the funds -- and being made in cash as often as possible.

Much of the information he provided was sales forecasts, product specifications, target prices of competitors and the news of approval of bids by Cresyn's competitors.

Other companies Devine agreed to provide information to were three Singapore-based companies, Jin Li Mould, Fast Tech and Glocom, as well as Kaedar of China and Nishoku of Taiwan. The complaint also names "companies associated with Nelson Lee."

The suit says Devine got $1 million from Jin Li Mould over the course of three years, and $46,000 from Cresyn in 2009. The payments from the other companies add up to hundreds of thousands in cash and stock.

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