On Friday, it was announced that a Georgia man had pleaded guilty in federal court to defrauding Staples Inc. of more than $1.4 million. 46-year-old Layne Michael Gosnell pleaded guilty to a single count of conspiracy to commit wire fraud and mail fraud. The defendant is now scheduled to be sentenced on January 10, 2018.
Gosnell had previously pleaded guilty in September, but another plea hearing was scheduled after it was determined that Gosnell was intoxicated above the legal limit in Massachusetts during the first plea hearing. Gosnell and co-conspirator, John Douglas, and others carried out a complex scheme to defraud Staples of more than $1.4 million worth of customer loyalty rewards and product rebates.
They attempted to create thousands of reward accounts, while often using fake names, addresses and contact information. Douglas also configured a computer script, which was capable of querying a Staples site to seek out unclaimed loyalty rewards for purchases that he nor Gosnell made.
The script was capable of making thousands of queries a day. In total, it amassed more than $889,000 in rewards. The defendant then used those rewards to purchase merchandise from Staples locations throughout the southern portion of the United State. Gosnell sold the fraudulently obtained merchandise on eBay.
The defendants used a similar method to obtain more than $527,000 in cash rebates from Staples for goods that they did not buy. Staples eventually discovered the fraud and reported it to federal authorities. Douglas was sentenced to 30 months in prison on September 6, 2017. He has also been ordered to pay $691,327 in restitution.
Layne Michael Gosnell is scheduled to be sentenced on January 10, 2018.