Former Delta Air Lines Employee Sentenced to Six Years for His Role in Defrauding Delta and Northwest Air Lines of More Than $36 Million
ATLANTA—Paul Anderson has been sentenced to six years and eight months in prison for his role in a scheme to defraud Northwest and Delta Air Lines of more than $36 million. Anderson and his co-defendant Michael Yedor submitted false invoices to both airlines, for work that was not performed but was billed for by a company allegedly owned by Yedor.
“The defendant’s lucrative and long-running scheme came crashing down when Delta uncovered his deception and informed law enforcement,” said Acting U.S. Attorney John Horn. “For more than a decade, Anderson used his position of trust within these airline companies to steal millions of dollars from the airlines for himself and a codefendant.”
J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office, stated: “The FBI remains well positioned and committed toward investigating those individuals who would engage in such complex wire fraud based schemes that generate high loss amounts as seen in this case. The sentencing of Mr. Anderson brings to a close a lengthy fraud scheme that spanned almost 15 years and targeted two major airlines.”
According to Acting U.S. Attorney Horn, the charges and other information presented in court: Anderson had been an employee of Northwest Airlines since 1979. In 2008, Delta Air Lines purchased Northwest. The two airlines merged into a single company in December 2009, at which time Anderson became a managerial employee of Delta, working in its Minneapolis, Minnesota office.
From at least 1999 through 2013, Anderson and co-defendant Michael Yedor engaged in a scheme to defraud Northwest and later, Delta, by submitting numerous false invoices on behalf of a company purportedly owned by Yedor, Airborne Voice and Data. The invoices sought payment from the airlines for goods provided and services supposedly rendered by Airborne Voice and Data, when in fact both Anderson and Yedor knew that Yedor’s company had not provided any such goods or services.
In order to receive payment for the false invoices, Yedor sent the invoices to Anderson, who had the authority to approve them for payment. Once Anderson approved the invoices, falsely indicating that the goods or services had been received, the airlines issued payments to Airborne Voice and Data. In exchange for approving each of the invoices, Anderson received a portion of the proceeds of the fraud. The defendants acknowledged that they received more than $36 million from the airlines during the scheme.
Anderson, 57, of Apple Valley, Minnesota, was sentenced by U.S. District Judge Timothy Batten to six years, eight months in prison, to be followed by three years of supervised release. He was also ordered to pay restitution of more than $36 million and to forfeit his individual retirement accounts. Anderson was indicted on June 10, 2014, and pleaded guilty on September 15, 2014, to conspiracy to commit mail fraud.
Co-defendant Michael Yedor, 62, of Los Angeles, California, was sentenced on January 9, 2015, by U.S. District Judge Timothy Batten to ten years in prison, followed by three years of supervised release. He was also ordered to pay restitution of more than $36 million, in addition to a personal money judgment of more than $36 million, and forfeiture of his interest in an array of real properties and luxury goods, including a Beverly Hills mansion and a 71.9 foot yacht.
Delta Air Lines cooperated fully with the investigation.
This case was investigated by the Federal Bureau of Investigation.
Assistant U.S. Attorneys Glenn D. Baker, Jamie L. Mickelson, and Jenny Turner are prosecuting the case.