Jury indicts man for stealing nearly $1M from Kent company

A Seattle grand jury indicted a California man on six counts of wire fraud for his alleged scheme to steal nearly $1 million from his Kent employer.

Paul Joseph Welch, of Laguna Niquel, California, was the information technology (IT) manager of Algas-SDI, an energy manufacturing company, when he allegedly used various schemes to steal more than $950,000 from the company, according to an April 11 U.S. Department of Justice press release. Welch is scheduled to be arraigned April 17.

According to the indictment, Welch worked for the company from 2011 to 2024. He was promoted to information technology manager in 2018. The indictment alleges that as early as 2017, Welch used the company’s Amazon business account to make unauthorized personal purchases from Amazon.com. Between 2017 and 2023, those purchases totaled at least $43,000. Welch reportedly primarily purchased electronics such at televisions, laptops and more—all for personal use. In 2019, Welch reportedly began using his company credit card for personal purchases through other online retailers such as Apple, Alaska Airlines, Instacart and Best Buy. Between 2019 and 2024, those unauthorized personal purchases totaled at least an additional $60,000.

The scheme really accelerated in January 2021 when Welch reportedly began making payments to himself disguised as payments to a computer services company. Welch allegedly created a series of email addresses and payment processor accounts using a business name that was very similar to a legitimate computer services company based in Washington state.

Welch then used Algas-SDI company credit cards to pay the computer services company under the guise that the company was providing IT equipment and services to Algas-SDI. However, the legitimate computer services company had no relationship with Welch and never provided any services or equipment to Algas-SDI. The credit card payments Welch made from Algas-SDI’s credit cards went directly to the payment processor accounts that Welch controlled. Between 2021 and 2024 Welch allegedly used this scheme to transfer approximately $879,175 from company accounts to his own accounts.

Algas-SDI tried to verify the legitimacy of Welch’s activity on multiple occasions, but each time, Welch allegedly provided false or misleading information to cover up his scheme. Algas-SDI employees asked Welch to submit invoices to substantiate his charges, but Welch allegedly emailed phony documents designed to look like invoices from the legitimate computer services company, according to the press release.

At one point in 2023, an Algas-SDI accounting employee identified personal purchases on Welch’s company credit card. Welch claimed the charges were inadvertent and said he would repay the company. Welch never repaid the charges and reportedly continued to defraud the company through unauthorized personal purchases and more fake vendor charges. In January 2024, alone, Welch allegedly submitted phony invoices to Algas-SDI showing that the computer services company had purportedly invoiced Algas-SDI more than $55,000 for equipment and services in that timeframe.

On Jan. 19, 2024, Algas-SDI employees confronted Welch about the charges from the computer services company accounts that Welch controlled. After Welch again told Algas-SDI that the vendor was a real vendor for the company, the company fired him.

The wire fraud charges represent six of the times Welch emailed the company false statements or invoices purported to be from a legitimate computer services company.

In all, between 2017 and January 2024 Walch reportedly secretly made at least 250 fraudulent charges for the third party vendor he controlled. He made at least 140 unauthorized purchases with retailers using the company credit card and at least 100 fraudulent purchases on the company’s Amazon account. While Welch profited some $950,000 from his theft, the loss to ALGAS-SDI was approximately $982,520 due to various fees on the transactions.

Wire fraud is punishable by up to 20 years in prison and a $250,000 fine, according to the U.S. Department of Justice.