Man sentenced in $1.9M electronics warranty scheme

A Pearland man was sentenced on Friday by a federal judge for his role orchestrating a $1.9 million warranty fraud scheme targeting multiple tech companies, according to a news release from the U.S. Attorney’s Office Eastern District of Pennsylvania.

U.S. District Judge Joel Slomsky sentenced Vaughn Simon, 29, to 15 months in prison, court records show. He was ordered to pay more than $1.9 million in restitution.

Simon pleaded guilty in June 2020 to 22 counts of mail fraud, eight counts of wire fraud, two counts of filing a false tax return, and one count of tax evasion, the press release stated.

He allegedly defrauded Cisco, Sony Electronics,

The Neat Company, Canon USA, APC, iRobot Corporation, and Skullcandy,

Inc., out of various electronics and computer hardware, by submitting hundreds of false warranty claims seeking to replace more than $4 million worth of products he was never in possession of, according to the release.

Although not every claim was successful, Simon was able to get the companies to send him $1.9 million worth of merchandise that he eventually sold on the internet or to computer equipment resellers, according to the press release.

Simon is the second person sentenced in the scheme, the release added. Justin David May, 32, of Wilmington, DE, was also sentenced to four years and eight months in prison in June 2021.

Additionally, the IRS’s Criminal Investigation Division found that Simon had filed false tax returns in 2014 and 2016 while also not paying income taxes for 2015. During that time, Simon was alleged to have earned over $400,000 through the fraud and failed to declare the money as income.

“Simon not only stole from these companies, but he also stole from the American public and the IRS,” said Yury Kruty of the IRS Criminal Investigation Division.