Apple Exec Gets A Federal Prison Sentence For Taking Kickbacks On Leaked Information

Paul Shim Devine, a former global supply manager for Apple, was sentenced to one year in prison for taking $1 million in kickbacks, according to 9to5Mac.

Devine had been leaking information about Apple's upcoming products to Asian suppliers who then used that info to their advantage in contract negotiations with Apple. The info was about headsets and iPod parts. When he was arrested, the FBI found $150,000 in cash stuffed into shoeboxes inside his house, CNET reported. Here's a copy of the original indictment against Devine.

Devine was indicted in 2010 and pled guilty in 2011 to charges of wire fraud and conspiracy, and forfeited $2.3 million in gains. He also sold a 2005 Porsche Cayenne in order to repay the money. Apple had also sued him for the money in civil court.

Devine's pre-sentencing memo said that he had grown up with a fear of economic insecurity due to the fact that his Korean father was a drunk who abandoned his mother.

The sentencing does not answer the one remaining mystery about the case: Why did it take so long for Devine to be sentenced?

One possible answer is that Devine was cooperating with the feds in an investigation of Apple's Asian suppliers and their American partners. Devine faced 20 years in prison but only got a fraction of that in sentencing. It is often the case that criminals will get lower sentences if they work with prosecutors to uncover other criminals involved in their schemes.

We cannot say that for sure, however. That's because the federal court docket for the case is riddled with sealed documents - which is relatively unusual for straightforward white-collar crimes. It is not, however, unusual for cases involving Apple, which has a history of asking courts to seal documents in order to guard its proprietary information.

The docket doesn't contain any motions from Apple or federal prosecutors asking for documents to be sealed. Usually, judges make rulings with specific findings of fact and law before allowing public documents to be hidden from view. No ruling appears on the docket, yet the documents were sealed anyway. (A federal appeals court in a different jurisdiction ruled against this practice in 2013.)

Apple is known to hate it when its own employees leak information. It once persuaded its sapphire glass supplier to sign a contract requiring it to pay a fine of $50 million for any leak to the press.