Massive software piracy case in Kansas City led investigators to former NBA player Kermit Washington
A software piracy case that started with an investigation of a 29-year-old Kansas City man led investigators all over a map of the United States and ultimately to Los Angeles where they arrested former NBA player Kermit Washington.
Washington was indicted by a federal grand jury in Kansas City on Monday on four counts — interfering with the Internal Revenue Service, wire fraud, falsification of federal records and aggravated identity theft. Washington was released on conditional bond on Wednesday, the same day the charges against him were unsealed.
In announcing the charges at a press conference, U.S. Attorney for the Western District of Missouri Tammy Dickinson said that investigators happened upon Washington through her office’s work on a nationwide $100 million Microsoft piracy case.
Dickinson’s office made headlines last year when it announced charges against several people, including Kansas City resident Casey Ross, for re-selling software codes for Microsoft and Adobe programs. Many of those software packages, federal authorities maintain, was littered with viruses. Ross owned Software Slashers, which investigators said sold tens of thousands of product key codes for Microsoft programs at well below retail prices. Ross pleaded guilty last summer.
Others in Washington, Colorado, Maryland and elsewhere were charged in that investigation.
Through that investigation, federal authorities say they learned that some of the product codes were sold through Internet auctions where proceeds were said to go to a charity run by Washington.
A call to Washington was not returned on Wednesday; it’s not clear which attorney has represented him in this case.
Washington played for five different NBA teams from 1973 to 1988. His playing career was a decent one, but Washington will always be remembered for the time he broke multiple bones in Houston Rockets forward Rudy Tomjanovich’s skull with a ghastly roundhouse punch during a scuffle in a 1977 game. Washington later went on to become a regional representative for the NBA Players Association, the union that represents professional basketball players. He served in that role until recently, authorities say.
Washington also set up a charity called the 6th Man Foundation, which did business as Project Contact Africa. PCA held itself out as a charity to benefit children with HIV/AIDS in Africa, authorities say. But the federal grand jury charges that Washington used most of the charitable contributions to PCA for his personal use.
“A very small fraction” of PCA’s income went to charitable purposes, Dickinson said on Wednesday.
In the 6th Man Foundation’s IRS forms for 2013, the most recent year available, it said it was using contributions to set up a medical clinic for needy families in Africa. That year, it received $51,154 in contributions but spent $61,600, with most of it going to an unnamed clinic’s operating expenses, according to the IRS form. The same document says that Washington received no compensation from the charity.
But investigators say Washington made more than $487,000 in diverted charity funds. Some of those came from Ron Mix, a former NFL star with the San Diego Chargers who later became an attorney representing professional athletes in worker’s compensation cases. Mix, authorities say, accepted client referrals from Washington in return for charitable contributions that he reported on his tax returns.
Mix pleaded guilty earlier this week to a charge of tax fraud tied to his dealings with Washington.