IT CEO Netflix Allowed Himself to Bribed in Exchange for Contracts

The former vice president of IT Operations at Netflix is facing years of imprisonment and hefty fines. He asked for cash and stock rewards from small IT companies in exchange for contracts with the streaming company.

 

Michael Kail was sentenced last Friday to 28 offences of fraud and money laundering. He was responsible for IT operations at the company between November 2011 and August 2014 and has enriched himself since 2012. In total, about half a million dollars plus stock options would have been funnelled into his company.

The payouts were typically 12-15 percent of the contract value. According to the court, Netenrich, Platfora, Nets Goedkoop, Numerify, Maginatics, Sumo Logic, Docurated and Elasticbox, among others, were told by Kail that they had to bribe him to accept contracts.

But Kail had other fraudulent practices. For example, he was a paid advisor at Platforma and provided the company with internal data from Netflix about a competitor’s contract proposal.

He would also have entered into contracts for products or services that other employees were explicitly not satisfied with. Kail also signed a contract with Platforma for 250,000 per year while Netflix was already using the services of a competing company.

The exact penalty for Kail is still to be determined. He faces up to 20 years in prison and fines of up to several hundred thousand dollars.

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