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Crime IT

Former Yale Employee Admits She Stole $40 Million In Electronics From University (npr.org) 76

Posted by BeauHD from the hope-it-was-worth-it dept.
An anonymous reader quotes a report from NPR: A nearly decade-long scheme to steal millions of dollars of computers and iPads from Yale University's School of Medicine is officially over. Former Yale administrator Jamie Petrone, 42, pleaded guilty Monday in federal court in Hartford, Conn., to two counts of wire fraud and a tax offense for her role in the plot. Petrone's ploy started as far back as 2013 and continued well into 2021 while she worked at the university, according to the U.S. Attorney's Office for the District of Connecticut. Until recently, her role was the director of finance and administration for the Department of Emergency Medicine at Yale. As part of this job, Petrone had the authority to make and authorize certain purchases for the department -- as long as the amount was below $10,000.

Starting in 2013, Petrone would order, or have a member of her staff order, computers and other electronics, which totaled to thousands of items over the years, from Yale vendors using the Yale School of Medicine's money. She would then arrange to ship the stolen hardware, whose costs amounted to millions of dollars, to a business in New York, in exchange for money once the electronics were resold. Investigators said Petrone would report on documents to the school that the equipment was for specific needs at the university, like medical studies that ultimately didn't exist. She would break up the fraudulent purchases into orders that were below $10,000 each so that she wouldn't need to get additional approval from school officials. Petrone would ship this equipment out herself to the third-party business that would resell the equipment. It would later pay Petrone by wiring funds into an account of Maziv Entertainment LLC, a company she created.

Petrone used the money to live the high life, buy real estate and travel, federal prosecutors say. She bought luxury cars as well. At the time of her guilty pleas, she was in possession of two Mercedes-Benz vehicles, two Cadillac Escalades, a Dodge Charger and a Range Rover. [...] At the time of her guilty plea, she agreed to forfeit the luxury vehicles as well as three homes in Connecticut. A property she owns in Georgia may also be seized. Petrone has also agreed to forfeit more than $560,000 that was seized from the Maziv Entertainment LLC bank account. Federal prosecutors say the loss to Yale totals approximately $40,504,200.
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Former Yale Employee Admits She Stole $40 Million In Electronics From University More

Former Yale Employee Admits She Stole $40 Million In Electronics From University

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  • The DOJ reported that when prison sentences are imposed, they are likely to be short -- from 6 months to 3 years; most sentences cluster around 1 year. This is about 3 times shorter than most street crimes.

    • I was going to make a joke about her having an ounce of weed but it’s legal now in Connecticut.

      • Re: (Score:1)

        by Tablizer ( 95088 )

        or pirating a Disney movie for friends. The Mouse knows how to lobby for "strong law and order".

    • I suppose we'll all forget about it and never know. But $40M is a huge number, far larger than the average white collar crime.

      • Yeah, $40 million! I work at a university - my first thought upon reading the summary was "wow, it must be nice to have a decent budget".

    • The DOJ reported that when prison sentences are imposed, they are likely to be short -- from 6 months to 3 years; most sentences cluster around 1 year. This is about 3 times shorter than most street crimes.

      Well, that makes perfect sense.

      With white collar crimes, you are much less likely that anyone physically got maimed or even murdered...than with street crime.

    • The courts in my town are very harsh on embezzlement. Like 20+ years for cases in the tens of thousands of dollars. They've never even seen a case like this one but she'd surely never see the light of day again.

    • The DOJ reported that when prison sentences are imposed, they are likely to be short -- from 6 months to 3 years; most sentences cluster around 1 year. This is about 3 times shorter than most street crimes.

      My guess is that she'll get a stern talking to by the judge, admit she made a mistake, and that will be it.

    • They should be shorter, so I guess all is working as it should. Any good left winger will be the first to talk about restorative justice and how the justice system's goals should be to prevent recidivism not punish to satiate the hunger of the vindictive, and how it should be people over money.. until it's a rich person then it's "they should get the death penalty or maybe be flayed alive for stealing those millions, dunno which."

      • Re: (Score:2)

        by narcc ( 412956 )

        Calm down, sparky. No one is calling for the death penalty. That's all in your imagination.

        There's also nothing wrong wrong with pointing out the hypocrisy inherent in our justice system. There is something seriously wrong with sentencing someone who stole $40 much more harshly than someone who stole $40 million.

        I know that you right wingers have a lot of trouble understanding that people with money can also be criminals, but she's only "rich" because she stole $40 million!

        • If you beat a 70 year old woman over the head to take $40, you should absolutely get a longer sentence than someone who nonviolently scammed $40M. You are a bigger threat to society. Your worldview makes no sense.
          • Not so much in this case because she's stealing from an extraordinarily wealthy institution, but most white collar crime is scamming people and targeting personal bank accounts. How many suicides and early graves from stress result when you go around stealing people's life savings? Lives destroyed from families becoming homeless? Fuck your narrow worldview where you think a 20 seconds of in your face violence against one person is 100x worse than wiping out the accounts of hundreds of people. They're *both*
            • Yes, I understand what you're saying but that's real fucking retarded is the main issue. See, your average timid little money thief doesn't get out of prison and go on to do even worse violent crimes. You put this lady in jail for a few years and the odds are she won't be doing it again. The guy who beat an old lady? Oh hell yeah, he'll do that and worse again more times than not.

  • That's $13,698/day (Score:3)

    by suso ( 153703 ) * on Wednesday March 30, 2022 @08:41AM (#62402539) Journal

    She must have been working pretty hard at this to rack that up in 8 years. I mean if you just count all the calendar days it comes out to almost $14,000 a day, so obviously she was making multiple purchases per day. Sounds like the Yale admins had their heads up their asses to not notice this.

    • Yeah, I don't believe the 40M represents the face values of the POs, they must be calculating this some other way, possibly including labor costs or something. There's no way she averaged over a PO a day for 9 years and nobody noticed. $10K here or there is easy to hide, many 1s of millions per year less so.

      • You might be surprised. It all depends on the total spend and how oversight between divisions works. Usually every charge needs to go against a program, so whomever is watching that program's finances should notice, even if it is a lowly medical professor without experience in finance or accounting.

    • I worked at a university 30 years ago. Trust me, the only thing that would make her suspicious is the fact that she's actually doing work. Probably half our department could have been laid off with no disruption to the work of the department.

      • Re: (Score:1)

        by Tablizer ( 95088 )

        the only thing that would make her suspicious is the fact that she's actually doing work. Probably half our department could have been laid off with no disruption to the work of the department.

        It's often said, "The most suspicious activity in a bureaucracy is hard work."

      • I worked at a university 30 years ago. Trust me, the only thing that would make her suspicious is the fact that she's actually doing work. Probably half our department could have been laid off with no disruption to the work of the department.

        Another characteristic of university administrators is the "I talk, you listen" attitude. The poop only flows downhill. The people above you don't want to be bothered with inquiries from below; they tell the underlings what to do and will not tolerate being questioned

    • Re: (Score:2)

      by Tx ( 96709 )

      If you exclude weekends, it's getting closer to $20,000 per day on average. Yeah, amazing that nobody noticed. I wonder how much she was doing in legitimate transactions by comparison.

    • Re: (Score:2)

      by ceoyoyo ( 59147 )

      Universities are pretty stupid. If a secretary wants to buy a computer, they just put the amount in the accounting system. But if a grad student wants to claim a plane ticket to a conference they require a receipt (not an invoice) a credit card statement, a physical object from the conference (I'm not kidding), a vial of blood from someone with genes compatible with the destination (that one might be slightly exaggerated).

      • That is due to tax laws so it is not considered income for the student.

      • Re: (Score:2)

        by bws111 ( 1216812 )

        What is stupid about that? It is how pretty much every business operates. Receipts are required for tax purposes. When the computer is purchased, the receipt is delivered to the purchasing department, not the person that made the request. When the grad student wants to claim a plane ticket, he, not the purchasing department, has the receipt and must turn it in.

        • Not every place has a purchasing department. I worked someplace where every month I would get a stack of invoices I had to approve for both one-off and recurring billing.

          I have mixed feelings about purchasing departments. They're often filled with morons who have no idea what they're purchasing or they make it really tough to build vendor relationships because they're constantly obsessed with trivial savings they can obtain by switching vendors.

    • Re: (Score:1)

      by Tablizer ( 95088 )

      It seems comparable to a gambling habit. It is a form of "gambling", with the law.

    • Or are swimming in so much cash that $40 million could vanish, from one department, without being noticed.

  • If she batched them up in orders of $10K and wound up stealing $40M, that's 4000 orders over 9 years, or 444 orders per year, or just under 2 orders per workday.

    And it took 9 years for alarm bells to ring??

    • I'd be sweating bullets if I were Yale's controller and auditors. Multiple people tasked with ensuring money goes where it was supposed to had to be asleep at the wheel for this to happen.

    • Yale is currently holding an endowment of over $40 billion. They have literally have more money than they know what do with.

    • In a way the administrator didn't steal the electronics from Yale, since the devices never reached Yale in the first place.

  • Two Words... (Score:1)

    by Anonymous Coward

    Sloppy Bookkeeping.

    Sloppy Audit

    This should have been found the second year that it went on... Boss: Why do you have 237 purchases that amount to between 9 990 and 9 999? Where are the goods/inventory tags?

    That it took them 10+ years and 40M USD boggles the mond... wonder how much other $$ the regents will find went missing by lower-level thieves that stayed farther under the radar.

    I'll bet the Yale School of Management is looking at this, going.. hurm.. maybe we should use our expertise to help the other c

    • Comment removed based on user account deletion

      • Re: (Score:2)

        by haruchai ( 17472 )

        Everything seems crystal clear from the safe distance of not knowing a fuck, right? All the problems are so easy to fix after they have already happened, mainly when you don't know what you are talking about! I wish we could have some sort of tool, an AI perhaps?, in a position to fully maximise that sort certainty. Any ideas? Algos?

        Some of us have worked for big institutions & or have had purchasing privileges.
        For nearly 20 years I was purchasing IT equipment for up to $20k at a time without 1st requiring signoff. But there was usually a quarterly review & you'd better have a good explanation if things didn't match up.

        • Comment removed based on user account deletion

          • Re: (Score:2)

            by Entrope ( 68843 )

            But it is a possibility though, and that was precisely my point: no knowledge, no talking.

            Welcome to Earth, you must be new here.

          • Re: (Score:2)

            by haruchai ( 17472 )

            I guess that if that woman was able to buy $40M without any justification, nobody would be surprised. But it is a possibility though, and that was precisely my point: no knowledge, no talking.

            It's not clear to me what your statement means, especially since it was stated she could only buy up to $10k per purchase order , 1/2 of what I was allowed to long before she was hired so considerably less when factoring in inflation.
            That's a lot of POs whether done by her or a staffer & by the office of the Director of FINANCE?
            That's a huge failure of verification & accountability & would not & could not have happened where I worked which was a healthcare institution.

      • Everything seems crystal clear from the safe distance of not knowing a fuck, right? All the problems are so easy to fix after they have already happened, mainly when you don't know what you are talking about! I wish we could have some sort of tool, an AI perhaps?, in a position to fully maximise that sort certainty. Any ideas? Algos?

        A bit testy aren't we? Do you know this person that did this? Trying to defend her?

      • "Everything seems crystal clear from the safe distance of not knowing a fuck"

        Everything seems clear when it's cribbed from the plot of an 80's movie. "An implausible number of almost but not quite $10,000 transactions" is how they caught the father in _Say Anything_. At least there he was doing cash transactions, which meant the investigators had to to do a little bit of research. This lady literally provided the receipts.

    • Comment removed based on user account deletion

    • Re: (Score:2)

      by jhecht ( 143058 )
      The Yale School of management will try to bury this one, but the Harvard School of Management would make it one of their case histories.

  • The fact that this happened at Yale - a college training the next crop of people with the ability to approve purchases - is quite ironic.

    Yale's CFO should be fired.

  • talking about how working class people stole $x millions. The investigations into how the 1% basically took all the COVID relief funds themselves (save what was sent directly to taxpayers) is kicking off, and the media at large would like very much for you to focus on all those poors stealing money and not the literal trillions that the rich just lined their pockets with.

    • Re: (Score:2)

      by King_TJ ( 85913 )

      You think her job was just "working class" to begin with? She was the head of Finance for a whole department at a prestigious university, and she STILL felt the need to steal enough to buy 5 luxury cars and so on. This isn't about your McDonalds employee....

      • well she is from the "petite-bourgeoisie", because she still needs to work to earn a living. Further up the ladder, people don't have to do that kind of petty theft to earn their money - it just comes to them in the form of dividends.

  • I mean, the crime itself is pretty horrendous ... but my first thought was, "How can you lose $40 MILLION dollars in iPad and computer orders and not even notice anything was wrong from 2013 through 2021?"

    Seems to me Yale has too much money if that's even possible.

    There are so many schools who wish they had 40 million *total* in a budget for technology.

    • Yale does have too much money - They have a 40 billion dollar endowment

    • My guess is she's not the only one doing it, and no one else wanted a good audit of the financials either.

      Someone probably noticed, but overruled by higher-ups who also had a scheme of their own going.

  • "At the time of her guilty plea, she agreed to forfeit the luxury vehicles as well as three homes in Connecticut. A property she owns in Georgia may also be seized. Petrone has also agreed to forfeit more than $560,000 that was seized ..." I like how it implies that she doesn't think she should lose all of her belongings. She stole $40 million and likely has less than that value in property, but she'll only agree to relinquish some, but not all. I don't have much sympathy for Yale, but I hope they throw

  • If this were a regular large company in the UK, your accounts would be audited every year. That is mainly to make sure you pay the right amount of corporation tax, but I would have thought it would show up any kind of discrepancy where assets are purchased, but can't be traced later. At my present place of work, assets such as laptops are given in-house serial numbers, so they are traceable. For the audit, you have to show what money you spent on assets, and show that you either sold them, or you still have

  • What about the medical school's decades of ripping off patients, insurance, and govt programs? She just wanted a piece of the ill-gotten gains pie.

  • can steal this big.

  • ...because of Petrone's actions, it's disappointing her penalties weren't more 'maziv.'

  • The only way someone in a position of authority like this can steal $40M over the course of ten years is that those providing oversight are colluding or incompetent. Maybe both.

  • I didn't see the article mentioning anything about the business in New York, to which she shipped the hardware. There's gotta be punishment for that business too right? For buying/selling stolen goods. Unless they can prove that they had no idea the stuffs were stolen.

  • $4.4 million USD per year is just $358 per student per year at Yale. Just raise tuition a little and you're set. Yale has $4.2 billion USD in operating revenues per year. $4.4 million is 0.1% of the total amount. That's a rounding error to some degree.

    Owning fancy/expensive vehicles/houses always seems to pop up as part of this type of story. We almost never hear about the people who steal millions of dollars worth of stuff but intentionally dress like they are homeless and drive a beater to avoid susp

  • Small wonder, she was caught.

  • Once they have enough to be set for the rest of their lives, why do they take the risk of continuing? Instead of emigrating somewhere?

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