Former New Mexico School District Employee Sentenced to 18 Months in Federal Prison for Stealing and Reselling Apple Products Meant for Native American School Children and for Tax Fraud

Baltimore, Maryland – U.S. District Judge Catherine C. Blake sentenced Kristy Stock, age 46, of Waterflow, New Mexico to 18 months federal prison, followed by three years of supervised release, for federal charges of interstate transportation of stolen goods and tax fraud.           

The sentence was announced by United States Attorney for the District of Maryland Erek L. Barron; Special Agent in Charge Darrell J. Waldon of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office; and Special Agent in Charge James R. Mancuso of Homeland Security Investigations (HSI) Baltimore. 

According to Stock’s plea agreement, and other court documents, beginning in 2014,  defendant James Bender agreed to allow a good friend, defendant Saurabh Chawla, and a relative of Chawla’s, SC2, to sell goods and merchandise through Bender’s eBay accounts. Chawla’s eBay account had previously been suspended due to security concerns. From May 2014 through August 2019, Bender and Chawla conspired so Chawla could use Bender’s eBay and PayPal accounts to sell stolen goods and merchandise. 

Stock worked for the Central Consolidated School District in New Mexico from 2010 to 2019 and was responsible for overseeing a program to provide Apple iPods to school children with the intent of benefitting Native American children living on tribal reservations in New Mexico.  On behalf of the school district, Stock directed federal grant monies be used to make bulk purchase orders of iPods, ranging from 100 to 250 units per order, two to three times each year.

Stock admitted that from 2013 to 2018 she stole more than 3,000 iPods purchased by the school district and sold them on eBay to Chawla and others for her personal benefit.  From October 2015 to 2018, Stock and Chawla dealt directly with each other, in emails, texts, and phone calls. Stock repeatedly advised Chawla of the items she had obtained, providing details such as the model, color and number of Apple products available. Chawla and Stock then negotiated a price, and Stock shipped the items to Chawla’s relative on the Eastern Shore in Maryland.  Chawla paid Stock through PayPal. Stock admitted that she received more than $800,000 in illegal proceeds from selling stolen iPods worth more than $1 million.  After his relative received the stolen goods from Stock, Chawla listed them for sale online through eBay at a substantial markup.

Stock also admitted that she filed false tax returns for calendar years 2012 to 2017, which failed to report significant amounts of taxable income, causing a tax loss to the United States of $270,821.

Saurabh Chawla, age 36, of Aurora, Colorado, and James Bender, age 36, of Baltimore, Maryland, were sentenced to 66 months and to a year and a day in federal prison, respectively. Additionally, Chawla was sentenced to pay restitution to the Internal Revenue Service in the amount of $713,619, and to sign an order of forfeiture requiring him to forfeit a 2013 Tesla Model S, $2,308,062.61 from accounts held in his name, and the sale of property in Aurora, Colorado.

United States Attorney Erek L. Barron commended the IRS-Criminal Investigation and HSI for their work in the investigation. Mr. Barron thanked Assistant U.S. Attorneys Harry M. Gruber and Paul A. Riley, who prosecuted the case.

For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.

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