MOD Systems co-founder Convicted of Fraud, Money Laundering in Federal Court
A co-founder and former chief executive of MOD Systems was convicted of federal fraud and money laundering charges today in federal court. The U.S. attorney’s office says Mark E. Phillips, 36, of Seattle, could get up to 20 years in prison when he’s sentenced in late May. Federal prosecutors say Phillips transferred $1.5 million from MOD Systems to his own account for a down payment on a penthouse, and also spent company money that had been transferred into a girlfriend’s account. Seattle-based MOD Systems, which makes technology to deliver movie and music files through self-service kiosks, announced in December that it was cutting 35 percent of its workforce. It had better news last fall when it raised $6 million in financing.