Akron Man Sentenced in Scheme to Defraud Dell Inc., and Dell Financial Services

Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, announced that Edward E. Bailey, Jr., age 36, of Akron, Ohio, was sentenced today by U.S. District Judge Christopher A. Boyko to 37 months in the custody of the Bureau of Prisons, followed by three years of supervised release. Bailey was also ordered to pay restitution in the amount of $460,376.43 to Dell Financial Services and Dell Computers, $25,000 to Warner Summit Fabricating of Barberton, Ohio, and $300 in special assessments to the Crime Victims’ Fund.

On December 8, 2009, a federal grand jury in Cleveland, Ohio, returned an indictment charging Bailey with mail fraud in connection with a scheme to defraud Dell Inc., and Dell Financial Services. On February 24, 2010, Bailey pleaded guilty to mail fraud charges.

The indictment charged that between January 2006, and December 2006, Bailey, then employed as the Office Manager for Warner-Summit Fabricating, Inc., of Barberton, Ohio, devised a scheme and artifice to defraud Dell Inc., and Dell Financial Services, and while carrying out the scheme, placed at least 410 orders through Dell Inc., for computers and other electronic equipment, which was shipped to Bailey in Barberton, Ohio.

The Indictment charged that Bailey fraudulently established lines of credit through Dell Inc., and Dell Financial Services in the name of Warner-Summit Fabricating, Inc., without the knowledge or authorization of the officers and owners of Warner-Summit Fabricating, Inc. Bailey later used the credit lines to charge computers and other electronic equipment he ordered from Dell Inc. Bailey later re-sold the computers and electronic equipment but failed to pay Dell Inc., and Dell Financial Services for the products.

This case was prosecuted by Assistant U.S. Attorney Robert W. Kern of the Cleveland U.S. Attorney’s Office, following an investigation by the Akron Office of the Federal Bureau of Investigation.