Computer Crime Research Center


EBay laptop swindler gets 4 years in prison

Date: October 13, 2004
Source: The Salt Lake Tribune
By: Bob Mims

What federal prosecutors called the nation's marquee Internet fraud case concluded Tuesday with the sentencing of eBay laptop swindler John P. Leary to more than four years in prison.

In addition to a 50-month term to be served at Nellis Federal Prison Camp, a federal minimum security facility in North Las Vegas, Nev., Leary, alias Russell Dana Smith, was ordered by U.S. District Judge Tena Campbell to pay nearly $885,000 in restitution to his victims. She did not impose a fine.

Prosecutors say Leary, as the owner of the now-defunct Liquidation Universe, auctioned off so-called bargain-priced laptops to hundreds of customers, but failed to deliver them. Starting in May 2003, buyers began complaining and eBay blocked Liquidation Universe from using its site.

Leary, who entered into a plea agreement with the government, was also sentenced to 60 months supervised probation after his prison time is served. He admitted guilt to six counts - four of mail fraud, one of credit union fraud and one of failing to file a tax return.

A federal grand jury had indicted Leary on 54 counts in October 2003, each potentially carrying maximum prison terms of five to 20 years and fines ranging from $250,000 to $1 million.

In presentencing comments to Campbell, Leary, wearing a blue-and-white striped inmate's uniform and shackled hand and foot, blamed his crimes on allowing "ambition and greed to make core business decisions."

"This is a turning point in my life," Leary added. "There were a lot of people who really


didn't trust me [but] who trusted the Internet and eBay and I let them down . . . I don't know if I can ever pay these people back, but I'll do the best I can."

Earlier, Leary's attorney, Mark Kouris, argued unsuccessfully that $99,000 of the restitution prosecutors wanted just for eBay should be lowered to $33,000, increasing the chances for individual victims to get some of their money back.

"EBay was deceived by the defendant just as much as the people who didn't receive [their laptops]," Campbell said, refusing to differentiate between the online auction company and other victims in the case.

EBay officials didn't return calls seeking comment late Tuesday.

Kouris was successful, however, in having nearly $13,000 trimmed from the restitution in relation to 15 customers. Leary claims he had actually bought their laptops and had them ready to ship. The computers allegedly disappeared during an ownership change about the same time at Liquidation Universe, Kouris said.
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Discussion is closed - view comments archieve
2005-04-19 11:53:51 - Would be nice if victims got their money... Bill Willcox
2004-10-13 19:57:48 - That guy is a perv! Billy Bob Thorton
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