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Ex-Apple manager pleads guilty in kickback case

Former Apple manager Paul Devine admits his guilt in a money laundering scheme and agrees to forfeit more than $2.28 million in money and property.

A former manager at Apple has pleaded guilty in a major kickback case that could land him 20 years in prison.

Paul Shin Devine, once employed at Apple as a supply manager, admitted guilt yesterday in federal court in San Jose, Calif., on charges of wire fraud, conspiracy, and money laundering. He was accused of taking kickbacks from Apple suppliers in exchange for information, according to the U.S. Department of Justice.

Devine, who worked at Apple from 2005 through 2010, sent forecasts, roadmaps, product specifications, and other confidential information to Asian suppliers and manufacturers of Apple components, according to court documents. In return, he received payments from those suppliers based on the amount of business they were able to win from Apple. The confidential information that Devine provided helped suppliers negotiate better deals with Apple and cost the company more than $2.4 million, Devine admitted as part of his plea agreeement.

In total, Devine was charged with 15 counts of wire fraud, 1 count of wire fraud conspiracy, 6 counts of money laundering, and 1 count of "engaging in transactions with criminally-derived proceeds." The wire fraud charges stem from the various bank accounts both in the U.S. and abroad that Devine opened up to hide his proceeds. As part of yesterday's plea agreement, he pleaded guilty to one count of each violation.

The plea agreement requires Devine to give up more than $2.28 million in money and property. Devine still faces a maximum prison term of 20 years on the wire fraud and money laundering charges. Sentencing is set for June 6.

"Mr. Devine is a good man who made a mistake, and now he's trying to make amends," his attorney, Raphael Goldman, said yesterday, according to Reuters.

Apple itself has filed a civil suit against Devine, which has been on hold pending the outcome in criminal court.

The investigation started last April when Apple discovered evidence of kickbacks on Devine's company-owned laptop. Devine was arrested in August. He initially pleaded not guilty to the charges. A search of his home in Sunnyvale, Calif., by federal agents uncovered more than $150,000 in U.S. banknotes hidden in shoe boxes along with $20,000 in other currencies.