Vaughn Simon, from Pearland, Texas, was charged with filing a false tax return, tax evasion, and mail and wire fraud for a scheme involving manufacturers’ warranties. Simon obtained serial numbers for products sold by Cisco, Neat, iRobot and APC and then submitted false warranty claims. Simon claimed the products had defects he knew could not be solved and the respective companies sent him replacement products, for items he never purchased in the first place. Simon then sold the products on eBay and Amazon.
Simon attempted to obtain more than five million dollars worth of products and was successful in getting more than three million dollars’ worth of products from Cisco alone.
Simon filed false tax returns for 2014 and 2016, where he underreported his income by $95,000 and $212,000, respectively. He evaded taxes altogether in 2015 by failing to file a return and storing the proceeds of his fraud in bank accounts and PayPal accounts in the names of his co-conspirators. He also hid cash at home, paid his living expenses with cash, used false domain names, prepaid gift cards and false identities.
He faces a maximum sentence of 821 years in prison, five years of supervised release and a fine of $8,250,000.