Former Netflix executive convicted of taking bribes

A federal jury on Friday convicted former Netflix vice president of IT operations, Michael Kail, for bribing a tech startup looking to deal with a streaming giant.

After a two-and-a-half-week trial in the San Francisco-based Northern California District Court for the U.S. Department of Justice, Kail was convicted of 28 of 29 cases of wire fraud, postal fraud, and money laundering. It was. Said In a statement on Friday.

Los Gatos-based 49-year-old Prosecution May 2018 accused of accepting more than $ 500,000 kickbacks between 2012 and 2014 instead of approving millions of dollars worth of deals with tech companies seeking to do business with Netflix it was done.

The conviction came after four days of deliberation. The trial was originally scheduled to be heard in March last year, but was postponed due to a coronavirus pandemic.

Judge Beth L. Freeman will hand down the decision within about three months, but Kail remains in custody. Kail faces up to 20 years in prison and a $ 250,000 fine for transfer or postal fraud convictions, and a $ 250,000 fine for 10 years imprisonment and money laundering conviction.

Kale pleaded not guilty. His lawyer, Julia Medinsky, did not respond to requests for comment.

“Bribery undermines the highly competitive environment of fair competition and innovation in all areas of business, especially cutting-edge innovation in Silicon Valley,” US Federal Attorney Stephanie M. Hinds said in a statement Friday. “Kail used a tremendous amount of power to approve a valuable Netflix deal with a small tech vendor. He tampered with the process and made himself a cash and stock kickback stream. Unleashed. ”

Netflix spokesman Jonathan Bing declined to comment on the incident. Netflix sued Kail in 2014, and the proceedings were settled out of court.

The case was the result of an investigation by the FBI and the Internal Revenue Service.

Netflix adopted Kail in 2011 to perform IT operations. He played that role until July 2014, during which he was responsible for approving contracts to purchase IT products and services from small vendors.

The government has provided evidence that Kail has taken bribes from nine tech companies seeking to do business with Netflix and is doing business to receive up to 15% of the bill. According to the Justice Department, Kale received over $ 500,000 in stock options from these companies and used them to cover personal costs and buy Los Gatos homes.

In one example in the summer of 2013, prosecutors said Kail met with employees of technology firm Platfora Inc. and agreed that Netflix engineers would test their data analysis software programs. On July 13, 2013, Kail met with Platfora’s CEO about drinks and then thanked him by email, “I look forward to helping you in both Netflix and advisory positions.”

Two days later, Kail signed a deal with Platfora, granting him the right to purchase up to 75,000 options, or about 0.25% of the company. He then provided Netflix with inside information about competitors’ contract bid prices, federal prosecutors said.

In September 2013, while being a paid advisor to Platfora, Kail signed a $ 250,000 annual contract with San Mateo on behalf of Netflix, giving Netflix employees a product despite their opposition and preferences. Prompted to find a usage for. Products that Netflix had already paid for, according to the Justice Department.

Netflix CEO Reed Hastings intervened and Kale denied he was working with Platofora, the prosecutor said. Kale resigned from his advisory position at Platofora the following week.

Former Netflix executive convicted of taking bribes Source link Former Netflix executive convicted of taking bribes

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