Former Microsoft Domain Manager indicted for fraudulent Billing Scheme

Carolyn M. Gudmundson, 44, of Kirkland, Washington, was indicted yesterday by a grand jury in Seattle for eleven counts of Wire Fraud and seven counts of Mail Fraud for a scheme in which she fraudulently billed her employer and related entities for reimbursement for costs she had purportedly incurred in registering and maintaining Internet domain names for Microsoft and Expedia.

Gudmundson fraudulently made more than $1 million with this scheme. Gudmundson was arrested last night and will make her initial appearance on the charge in federal court in Seattle at 2:30 p.m. today. Wire Fraud and Mail Fraud are punishable by up to 20 years in prison and a $250,000 fine.

According to the indictment, Gudmundson was employed by Microsoft as a Program Manager in Microsoft’s MSN Division. Between 2000 and 2004, Gudmundson was responsible for registering, transferring, renewing, acquiring and retiring Internet domain names for Expedia and Microsoft. During the course of this part of her job, Gudmundson defrauded Microsoft in three ways.

First, Gudmundson was authorized to use her personal credit card to purchase, renew and acquire Microsoft’s domain names and then submit reimbursement requests to Microsoft. Gudmundson altered the credit card receipts she submitted so that they showed a much higher price for the purchase, renewal and acquisition of domain names than she actually had paid, and then used these altered credit card receipts to support the false and fraudulent amounts claimed on her reimbursement requests to Microsoft.

Second, Gudmundson allegedly submitted invoices to Expedia for the registration of domain names that she had not paid for.

Third, Gudmundson used an outside company that assists in the negotiation for the purchase of domain names from private parties. Gudmundson told an employee of that company that a fictitious individual had purchased domain names in his name on Microsoft’s behalf and that she needed the employee to send a check to that individual to reimburse him for his costs. Gudmundson then directed the employee to send the checks to her, where she allegedly deposited them into a bank account that she controlled.

The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.

The case was investigated by the US Postal Inspection Service. The case is being prosecuted by Assistant United States Attorney Kate Crisham.

For additional information please contact Emily Langlie, Public Affairs Officer for the United States Attorney’s Office, at (206) 553-4110.

Source: United States Attorney’s Office Western State of Washington Announcement – December 7th, 2007

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