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HP broker gets 11 years for illegal server upgrades

Made big money while it lasted

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A US computer broker has been sentenced to 11 years in prison for defrauding Hewlett-Packard.

The broker, Richard Adamson, had been using pirated software to upgrade HP severs and the sell them for higher prices at his Dallas-based firm Hardwarehouse.

Reuters reports Adamson was found guilty of eight counts of wire fraud and one count of money laundering.

Hardwarehouse grew from a small business to a 40-person company with sales over $10 million thanks to the scam.

Richard Adamson and his brother John were selling the upgraded servers between 1995 and 1998. They had inside help from Deborah Balon, and HP staffer in charge of inventory, who helped the brothers secure licences for the souped-up servers.

John Adamson and Balon are due to be sentenced next month.

According to Reuters, the Judge in the case Garland Burrell, found that Adamson tried to obstruct investigators in the case. One of his methods was to write notes to employees on napkins, which he would then eat so they couldn't be used as evidence against him.

The scam is a variant of the hard disk doubling con, which went on in the early days of the off-the-page cowboy computer assemblers. PCs were advertised as having larger hard disks than they really had because disk-doubling software, which was far cheaper than the larger hard drives, was installed on the machines. It probably still goes on. ®

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