Ex-Facebook Diversity Manager Admits to Stealing $4M
Former Facebook Diversity Strategist Pleads Guilty to Stealing $4 Million in Elaborate Scheme
A former Facebook global diversity strategist has admitted to stealing over $4 million from the company through a complex and deceptive plan involving fake vendors, fabricated charges, and secret kickbacks, according to federal prosecutors.
Barbara Furlow-Smiles, 38, has pleaded guilty to wire fraud in connection with the scheme, as confirmed by the U.S. Attorney’s Office in Atlanta.
Leading Facebook’s Diversity, Equity, and Inclusion Programs
Furlow-Smiles held a prominent role at Facebook from January 2017 to September 2021, spearheading the company’s Diversity, Equity, and Inclusion (DEI) programs. As the lead strategist and global head of employee resource groups and diversity engagement, she was responsible for developing and implementing initiatives to promote diversity and inclusion within the organization.
Exploiting Her Position of Trust
With access to company credit cards and the authority to approve invoices, Furlow-Smiles took advantage of her position to deceive and defraud Facebook, prosecutors revealed.
Using PayPal, Venmo, and Cash App accounts linked to her Facebook credit cards, she made payments to friends, relatives, and others for goods and services that were never provided to the company. To conceal these transactions, she submitted fraudulent expense reports, falsely claiming that her acquaintances had performed work for Facebook, such as marketing or providing merchandise.
An Elaborate Network of Collusion
According to prosecutors, Furlow-Smiles orchestrated an intricate web of collusion to receive kickbacks. She instructed her friends to pay each other, sometimes using accounts in her husband’s and other individuals’ names, to further conceal the scheme. Cash payments were made in person or through the mail, with one instance involving hiding money in a t-shirt. Additionally, Furlow-Smiles had Facebook hire vendors operated by her friends, approving inflated invoices that allowed the vendors to pay her kickbacks.
Individuals Involved in the Scheme
The individuals implicated in the scheme included friends, relatives, former interns, nannies, babysitters, a hair stylist, and even her university tutor. Prosecutors also revealed that Furlow-Smiles had Facebook cover various expenses for others, including specialty portraits and preschool tuition.
A Lavish Lifestyle Funded by Fraud
“She used the money to live a luxury lifestyle in California and Georgia,” prosecutors stated.
Sentencing and Ongoing Investigation
Furlow-Smiles is scheduled to be sentenced on March 19. It remains uncertain whether the other individuals involved will face charges, as most of them were reportedly unaware that the funds originated from Facebook. The FBI is currently investigating the case, with cooperation from Meta, Facebook’s parent company.
U.S. Attorney Ryan Buchanan condemned Furlow-Smiles’ actions, emphasizing the betrayal of her DEI mission and the pursuit of personal gain over honest work. “Motivated by greed, she used her time to orchestrate an elaborate criminal scheme in which fraudulent vendors paid her kickbacks in cash. She even involved relatives, friends, and other associates in her crimes, all to fund a lavish lifestyle through fraud rather than hard and honest work,” Buchanan stated.
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Fabricating Evidence to Cover Her Tracks
To further conceal her illicit activities, Furlow-Smiles went to great lengths to fabricate evidence of these transactions. She created fictitious vendor identities, complete with false names, addresses, and contact information. These vendors were then listed on the fraudulent invoices submitted to Facebook, making it appear as though legitimate transactions had taken place.
In reality, the money she funneled to these fake vendors was ultimately returned to her through secret kickback arrangements. Some of the payments were made directly to her personal accounts, while others were funneled through accounts belonging to her relatives and associates.
Uncovering the Elaborate Scheme
Facebook’s internal audit team initially detected irregularities in the company’s expense reports and alerted law enforcement authorities. The subsequent investigation revealed the extent of Furlow-Smiles’ deceitful actions and the substantial amount of money she had stolen over the course of several years.
Federal prosecutors presented evidence demonstrating how Furlow-Smiles manipulated the company’s financial systems, exploited her role, and meticulously covered her tracks to avoid detection. They also highlighted the significant breach of trust she committed as a senior employee entrusted with the company’s diversity programs and resources.
Pleading Guilty and Facing Consequences
In November 2021, after her indictment, Furlow-Smiles pleaded guilty to one count of wire fraud, acknowledging her role in the elaborate scheme to embezzle funds from Facebook. As part of her plea agreement, she has agreed to repay the stolen amount, totaling over $4 million.
Furlow-Smiles now faces a maximum sentence of 20 years in prison and a fine of up to $250,000. Her sentencing is scheduled for early 2022, where the court will decide the appropriate punishment for her crimes.
Implications for Facebook and the Tech Industry
This case raises questions about the effectiveness of internal controls and oversight measures within a company as large and influential as Facebook. It highlights the importance of robust internal auditing and monitoring systems to detect and prevent fraudulent activities.
Furthermore, this incident significantly damages Facebook’s reputation, particularly in the area of diversity and inclusion. The fact that such dishonesty and abuse of power could occur within its own diversity programs is deeply concerning. Facebook will need to take swift and decisive action to restore trust and demonstrate its commitment to ethical practices and transparency.
Ultimately, this case serves as a warning to companies across the tech industry about the potential vulnerability to internal fraud and the critical need for strong safeguards to protect company assets and uphold their values.
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