U.S. Department of Justice

Federal Bureau of Investigation

March 5, 2007

FBI ANNOUNCES THE ARREST OF NEWARK
COMPUTER CONTRACTOR FOR $10,000,000 IN MAIL FRAUD

Newark - Pedro Ruiz, Acting Special Agent in Charge of the New Jersey Office of the Federal Bureau of Investigation announced that Special Agents from the Federal Bureau of Investigation and Detectives from Newark Police Department arrested Michael Kyereme, age 40 of Piscataway, New Jersey for Mail Fraud under 18 United States Code Section 1341.

Kyereme was an independent contractor hired to provide information technology support to the City of Newark. As an independent contractor, defendant Michael Kyereme was responsible for assisting Newark employees when computer problems arose that required technical support or “trouble-shooting” by a computer technician. If it was determined that a computer-related problem could not be solved without outside assistance or a replacement part, Kyereme was authorized to contact Cisco Systems, Inc., (Cisco) for technical assistance and, if necessary, to request a replacement part.

Kyereme used his position as an independent contractor to engage in a scheme to defraud Cisco of money and property valued at more than $10,000,000. It is alleged in the complaint that Kyereme would falsely claim that certain Cisco parts in the City of Newark's computer systems were malfunctioning and thus required replacement. In response to these numerous requests, Cisco sent approximately 280 replacement parts to Kyereme on behalf of the City of Newark. Instead of installing these parts in the City of Newark's computer system, Kyereme would keep the parts and sell them to a computer reseller, and keep the money for himself, while returning parts of lesser commercial value to Cisco. In all, Kyereme failed to return 148 of the allegedly inoperable parts to Cisco and of the approximately 132 allegedly inoperable parts he did return to Cisco, only 33 of those parts matched the type of part originally sent by Cisco to Kyereme

Kyereme is scheduled for a first appearance hearing before The Honorable Mark Falk, United States Magistrate Judge at the Newark Federal Courthouse on Monday, March 5, 2007 at 2:30 PM.

A copy of the complaint is attached.