Apple has just discovered a fraud orchestrated by several employees of its Cupertino headquarters. According to information obtained by IndiaToday, 50 employees had found a way to make money on the back of the Californian company. In the space of three years, they were able to win more than $150,000 with this strategy.
The fraud exploits a charity program launched by Tim Cook, CEO of Apple, in 2018. Called “Matching Grants”, the program allows the company’s employees to see their financial donations doubled by Apple. Concretely, Apple has committed to paying double the amount that its employees have donated to the charities of their choice. If an employee decides to donate $10, the firm will pay $20. The annual maximum amount is capped at $10,000 per employee.
False Donations and Tax Fraud
As the media outlet explains, some employees took advantage of the program to obtain tax breaks with the complicity of charities. Initially, the 50 employees made financial donations to charities. As promised, Apple donated double the amount to the charity.
Later, the employees got their initial investment back. Some nonprofits agreed to reimburse the employees while keeping Apple's money. Later, the employees were able to deduct all of their donations and obtain a tax break. This is therefore tax fraud.
Falsifying donations violates both U.S. tax laws and Apple's policy. After years of fraud, Apple’s financial department finally realized that something was going on and opened an investigation. The Cupertino group also notified the Internal Revenue Service (the US tax administration). The US tax authorities were able to shed light on the scheme.
Six employees before the US courts
That’s why the company fired 50 employees. Note that an article on the site greatandhra instead talks about 185 workers fired in the wake of Apple’s discovery. The layoffs include both senior executives and juniors.
In addition, six of the employees suspected of fraud are the subject of a complaint. Apple has indeed chosen to prosecute six people, including an individual considered to be the ringleader of the gang, in the United States courts.
The instigator of the scam has been identified as being linked to two of the charities involved, namely the American Chinese International Cultural Exchange (ACICE) and Hop4Kids. The man ran one of the associations and managed the accounting of the other. He was therefore well placed to orchestrate the fraud under the radar.
Source: IndiaToday
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