A former Microsoft employee was arrested Monday for allegedly ordering more than $17 million worth of software via an internal purchasing system and then selling it to keep the proceeds for himself.
Richard Gregg, 43, was also indicted Monday on 62 counts of mail and computer fraud, according to court papers.
Gregg allegedly ordered 5,436 pieces of software worth more than $17 million at retail price, which he sold for a profit, according to an investigation by the FBI and U.S. Attorney’s Office for the Western District of Washington state.
Gregg, who pleaded not guilty to the charges, was fired from Microsoft in December at the same time when another Microsoft employee was also terminated on suspicion of ordering software and reselling it for a profit.
Redmond, Wash.-based Microsoft said that Gregg, a project coordinator for developing Windows, the company’s flagship operating system, was one of the reasons why the company adopted a more stringent antitheft policy late last year.
“When we identified this activity last December, we immediately took several steps to ensure this would not happen again and referred Gregg to law enforcement officials,” said John Connors, Microsoft’s chief financial officer, who also oversees internal administration.
“Since that time, we have been working very closely with the FBI and U.S. Attorney’s office on the investigation and have made changes to our internal ordering system to prevent this from happening again,” Connors said in a statement.
Microsoft also hired investigators and put in updated systems to crack down on violations of internal policy after Daniel Feussner, a former Microsoft manager, was fired and arrested in December 2002 for allegedly funding a lavish lifestyle by selling discounted software for personal profit. Feussner later died in a local hospital after ingesting antifreeze.
Gregg allegedly ordered software at a deep discount from Microsoft’s internal purchasing system from January 2002 to December, according to the indictment.
