Suspect in $36 Million Embezzlement Extradited to L.A. From Costa Rica

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A former accounting manager accused of embezzling more than $36 million from a Los Angeles media technology services firm arrived in Los Angeles Thursday afternoon after being extradited from Costa Rica to face charges, authorities said.

Paul McDaniel, also known as Edward Martin Karuku, 42, lived in the City of Orange before fleeing to Costa Rica in early-2017, U.S. Department of Justice spokesman Ciaran McEvoy said in a written statement.

He’s charged with 10 counts of wire fraud for allegedly stealing more than $36 million from Hypermedia Systems Inc. between 2009 and 2016 while working as an accounting manager for the company, both as an independent contractor, then as an employee of L.A.-based E-Times Corp.

“McDaniel formed a Nevada corporation with a name similar to one of Hypermedia’s vendors and then opened a bank account – under which he had complete control – in that entity’s name,” McEvoy said. “He then allegedly used his authority as Hypermedia’s accounting manager to approve and direct payments totaling more than $36 million to this bank account.”

McDaniel created bogus invoices using real letterhead from Hypermedia vendors, officials said.

“McDaniel used the funds to pay off $23 million in credit card bills and transferred another $8 million to his personal bank accounts, ” McEvoy added. “Investigators believe he spent additionally millions of dollars on miscellaneous expenses.”

Officials arrested McDaniel in Costa Rica in 2017 and held him pending extradition proceedings.

If convicted as charged, McDaniel faces up to 20 years in federal prison for each count of wire fraud, officials said.


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