LinkdotNet's CEO charged with US$2 million fraud
The chief executive of Egypt's largest internet company LinkdotNet, Khaled Galal Beshara has been charged in New York for trying to defraud an American aid agency USAID to the amount of US$2 million, prosecutors said.
The chief executive of Egypt's largest internet company, Khaled Galal Beshara has been charged in New York with trying to defraud an American aid agency, U.S. prosecutors said.
According to the report by Associated Press (AP), Khaled Bishara of LinkdotNet was arrested July 10 after arriving in New York and released after paying US$300,000 bail and surrendering his passport, officials at the U.S. attorney’s office in New York said.
The charge relates to Bishara’s bid, on behalf of Linkdot Net, to obtain a loan of about US$2 million in 2001 from the US Agency for International Development (USAID) to buy computer equipment through a US supplier.
“Bishara was in America to resolve an administrative issue and LinkdotNet has repaid the money in question about one year ago to USAID. We cannot comment on the federal charges against Bishara,” says Omar Fahmy, LinkdotNet’s marketing manager.
The charge relates to Bishara’s bid, on behalf of LINKdotNET, to obtain a USAID loan of about US$2 million in 2001 to buy Lucent Technologies’ computer equipment through an American supplier, CyberCrossing.
The loan was obtained under USAID’s commodity import programme. The American government provides interest-free loans to Egyptian companies to purchase US-made commodities. The companies later repay the loans in Egyptian pounds to the Egyptian government, which must use the funds to finance development projects here.
A USAID affidavit, obtained by the French news wire, alleges that instead of spending all the money on the American equipment from an American supplier, Bishara’s company “illegally used the funds both to pay a past debt and to purchase equipment” from an Egyptian telecommunications firm, the Saudi Egyptian Logistics and Electronics Company says the news report.
Megan Gaffney, a spokeswoman for the US Attorney’s office in New York, said Bishara “has been charged with devising a scheme to defraud” USAID.
Though the affidavit mentioned an unnamed coconspirator, no one else has yet been charged. LinkdotNet is owned by Orascom Telecom Holding Company. Orascom Telecom is one of the largest independent GSM operator serving twenty markets in the Middle East and Africa. Even officials from the parent company Orascom had no immediate comment.
In 2001, LinkdotNet, partnered with Microsoft’s MSN Arabia to become the exclusive sales house for MSN Messenger and Hotmail in the Middle East. LinkdotNet is one of four 'Class A' internet service providers (ISP) in Egypt.
The license allows LinkdotNet to have its own internet backbone directly from international backbone providers, to co-locate its equipment at Telecom Egypt premises and to sell to other ISPs among other privileges. It has similar partnerships with UUNET for its backbone bandwidth.
A preliminary hearing has been set for September. The US Attorney’s office say Bishara has not yet entered a plea.