CUPERTINO — Six former Apple employees face fraud-related charges in the South Bay after allegedly exploiting a charity-matching program by making bogus donations to nonprofits controlled by one of the defendants, then pocketing the company’s matching funds and claiming false tax write-offs.
The underlying investigation has been at least two years in the making after Apple first alerted the Santa Clara County District Attorney’s Office to suspicious activity that reportedly spanned 2018 to 2021.
On Tuesday, the district attorney’s office announced charges against Siu Kei “Alex” Kwan, 37, of Castro Valley, and five other Bay Area residents encompassing allegations of grand theft, conspiracy to commit felony grand theft, perjury and tax fraud.
The group is accused of making upwards of $100,000 in donations to two charities for which Kwan — described by prosecutors as the ringleader of the alleged scheme — served as an officer. They then allegedly extracted $152,000 in matching and over-matching funds from Apple’s Matching Gifts Program.
“This case underscores our unwavering commitment to rigorously prosecuting individuals who defraud the tech community and misuse vital charitable programs and state resources,” District Attorney Jeff Rosen said in a statement. “We commend Apple for coming forward and actively collaborating with our office to uncover this elaborate fraud.”
According to investigators with the office’s Major Fraud Unit, between July 1, 2018 and April 6, 2021, Kwan and five colleagues at Apple made thousands of dollars in donations to the San Francisco-based American Chinese International Cultural Exchange Council — for which Kwan was an accountant — and Hop4Kids, a charity that Kwan led as its CEO.
Apple and the two charities did not immediately respond to requests for comment Tuesday. It was not immediately clear if the defendants were fired from Apple directly because of the alleged crimes, but the district attorney’s office said none were working for Apple when it began investigating.
Kwan used his position at the nonprofits to refund the donations to the other defendants, but only after referencing the donations to get matching funds from Apple, investigators said. Besides keeping the matching funds for himself, Kwan is accused of helping the alleged co-conspirators claim phony tax deductions from the refunded donations.
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The other people charged in the case are Zheng Chang, 31, of Union City; Wentao “Victor” Li, 38, of Hayward; Lichao Ni, 39, of Sunnyvale; Yat C “Sunny” Ng, 35, of Milpitas and Yathei “Hayson” Yuen, 34, of San Jose.
Because of the amount of money involved in the charges, prosecutors said the six defendants face potential sentencing enhancements under aggravated white-collar crime laws. Convictions would subject them to possible jail time, restitution, and fines and fees.
Kwan is scheduled to be arraigned at the end of the month, while his co-defendants are scheduled for arraignment in January.
Anyone with information about the case can email DA Investigator Justin DeOliveira at jdeoliveira@dao.sccgov.org.