Texas CEO Sentenced to 63 Months in Prison for Hacking
Michael Musacchio hacked into his former employer's computer system to steal proprietary business information.
Michael Musacchio, 62, of Plano, Texas, was recently sentenced to 63 months in federal prison for conspiring to hack into his former employer's computer network. The issue of restitution is still under consideration by the court (h/t DataBreaches.net).
According to evidence submitted at trial, Musacchio was the president of Exel Transportation Services from 2000 to September 2004. In 2004, he left Exel to form a competing company, Total Transportation Services, as president and CEO. Two other former Exel employees, Joseph Roy Brown and John Michael Kelly, also left to join the new company.
Between 2004 and 2006, Musacchio and Brown, assisted by Kelly, hacked into Exel's computer system to conduct corporate espionage. By accessing's Exel's e-mail accounts, Musacchio and Brown were able to steal confidential and proprietary business information from Exel that benefited Total Transportation Services.
Musacchio was convicted in May 2013 on one felony count of conspiracy to make unauthorized access to a protecting computer and two felony counts of hacking. Brown and Kelly have entered guilty pleas, and are scheduled to be sentenced on September 25, 2013.
According to the Dallas-based Yarbrough Law Group, the criminal case was based on a trade secret theft lawsuit filed in 2006 by attorney Matthew Yarbrough, which yielded a $10 million settlement against Total Transportation Services. "If we hadn't filed the civil case, there probably wouldn't have been a criminal case," Yarbrough said in a statement. "It took more than seven years for Mr. Musacchio to be brought to justice in criminal court. That's why companies need to move as quickly as possible to take civil legal action against those who steal company trade secrets and intellectual property."