PORTLAND, Ore.—A former marketing executive for Nike, Inc. was sentenced today to more than two and a half years in federal prison for carrying out a scheme to defraud his former employer and childhood friend.
Errol Andam, 47, formerly of Beaverton, Oregon, was sentenced to 31 months in federal prison and 3 years of supervised release. Andam was also ordered to pay more than $1.6 million in restitution. The Internal Revenue Service had previously seized $212,838 in proceeds of crime from Andam, and these were also confiscated.
According to court documents, from 2001 until his firing in 2018, Andam was employed by Nike at its headquarters in Beaverton. Most recently, Andam worked as director of the company’s North American Retail Brand Marketing division, where he managed the design, construction and operation of “pop-up” retail sites, temporary Nike stores located nearby and suitable for athletic competitions and other special events across the United States
In the summer of 2016, Andam recruited a childhood friend to start a company to design and build the pop-ups as an independent contractor for Nike. Andam used his authority as a manager at Nike to make sure his friend’s company consistently got the contracts for this work. Although he had no official role in his friend’s business, Andam assumed control of much of the company’s financial operations, managing financial accounts and issuing invoices to Nike.
To conceal his role in the scheme, Andam used an alter ego, “Frank Little”, to bill Nike and manage the company’s account under contract with Square, Inc., a California-based provider of mobile credit card processing services. . In 2016, Andam also renewed the expired registration of an Oregon-based limited liability company (LLC) he owned so he could use the defunct entity as a front company to funnel diverted proceeds from Nike. and from his friend’s company to accounts under his personal name. control.
Beginning in September 2016, Andam arranged for credit card sales at various pop-up locations in the United States to be executed through card readers associated with a Square account owned by his friend’s company. This proceeds were transferred to Square in California and then to Andam’s LLC bank account in Oregon. Andam told both Nike and his friend that the proceeds from those sales were deducted from the total amount Nike owed his friend’s company. In truth, Andam simply pocketed the product and, as “Frank Little”, billed Nike for the full cost of the contracted services.
From September 2016 to December 2018, Andam misappropriated and misappropriated nearly $1.5 million of Nike’s proceeds for his own use. In July 2018, Andam submitted a false financial statement from his LLC in support of a residential mortgage application. The financial statement falsely reflected revenue checks for $194,000 drawn on a bank account belonging to his friend’s company. Andam forged his friend’s signature on one of the checks and withdrew much of that money without his friend’s knowledge.
On February 4, 2021, Andam was accused by criminal information with wire fraud, money laundering and misrepresentation when applying for a loan. On April 12, 2021, he pleaded guilty on all three counts.
This case was investigated by the IRS Criminal Investigation and the FBI. He was prosecuted by Ryan W. Bounds, Assistant United States Attorney for the District of Oregon.