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Tech Roundup: Entellium Arrests, Verizon Support, H-1B Fraud, More

FBI arrests Entellium CEO, CFO -- The FBI arrested Entellium's CEO Paul Thomas Johnson and CFO Parrish Jones for allegedly falsifying revenue figures and presenting them to the board as part of a scheme to get about $50 million invested in the company. Last month an employee cleaning out the desk of a departed vice-president of sales found a second set of books that allegedly were presented to the company's board and which, among other things, claimed almost $4 million in 2006 revenue when the real number was $582,789. The SaaS vendor laid off most of its employees last week. It was in the CRM business. Perhaps management was just practicing its relationships management skills. [Source: ZDNet Between the Lines]

More detail on Sequoia doom and gloom -- More details are coming out on the meeting Sequoia Capital called with its portfolio companies. Some of the big points were cut all unnecessary spending, get cash flow positive (or no one will think of investing), focus on quality, reduce risk, toss all the models and spreadsheets because they're based on assumptions that are now erroneous, PR and communications strategy will be key, and M&A is going to drastically reduce, so only the most fit will be bought. Oh, and according to Eric Upin, a Sequoia partner who up until recently ran Stanford's endowment fund, this could be a 15-year downturn that will be a global risk to personal wealth, not just growth. According to Upin, "It's always darkest before it's pitch black." Ah, well, in case the seasonal horror movies weren't scary enough. Do check the Force of Good link, as there are even more details. [Source: GigaOM, Force of Good]

Vendors try to get theirs from WaMu -- Here's a story that's likely to become all too familiar over the next few months and even years: companies dealing with the death of a financial services client. Microsoft, Siemens, and Tata Services are all staking out space at the Delaware bankruptcy court because of the Washington Mutual collapse. All three have product or service contracts with the organization, and bankruptcy can have a tricky way of locking things into place while leaving payment a question for extended periods of time. Supposedly analysts are saying that the remaining financial services companies will still need to rely on technology, so high tech companies won't be hit too hard. Beg to differ. There will be fewer organizations, fewer employees, and cash redirected away from IT purchases and toward increasing reserves so things may not be pleasant, especially for small- to mid-sized firms that don't have the deep financial resources to keep afloat as easily. [Source: InfoWorld]

H-1B visa rife with fraud and violations -- For years companies have been yelling that they need H-1B visas because there aren't enough trained people in the U.S. and the only choice was to bring people in from overseas. But maybe there was something else afoot, as, according to a new report, as many as one in five of the visas faced at least "technical violations," and there have been cases of forged documents, faked degrees, shell companies, and companies having people do different work than they were supposed to and not paying prevailing wages. The report was based on a random sampling of almost 250 cases out of almost 100,000 and 51 of those had problems. Hey, there are probably a good number of financial service people who probably could be convinced to head back to school for an engineering degree. After all, if you can't be master of the world, might as well have a job. [Source: ComputerWorld]

Verizon tries tech support -- Verizon has unveiled its Expert Care program, vying with Best Buy's Geek Squad and AT&T's ConnecTech to get the advance tech support dollars from the technically fearful. There are various degrees of support, but I managed to get a copy of the actual legalese. First, the program doesn't deal with pre-existing conditions. Second, to get service done on a PC or laptop requires paying a $75 fee in addition to the $10 or more a month the user shells out for the coverage, meaning even one repair on one computer a year would effectively run at least $195. Third, there's an unstated aggregate limit on the amount of hardware dollars it will reimburse for all Verizon customers taken together. Fourth, the program is backed by AIG. Uh oh. Does this mean that everything will be working the way the federal government does? Maybe better stick with that expensive door stop after all. Remember, things actually could get worse. [Source: Verizon, Ars Technica]

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