Avaya reseller boss pleads guilty of $88m pirate software scheme

The scheme involved generating and then selling unauthorised Avaya Direct International (ADI) software licenses

Jason Hines has pleaded guilty in the Western District of Oklahoma to participating in a massive international scheme to make millions of dollars by selling pirated business telephone system software licenses.

The entire scheme allegedly resulted in the sale of software licenses with a retail value of over $88m (£68.7m).

According to court documents, Hines conspired with co-defendants Brad Pearce and Dusti Pearce to commit wire fraud.

The scheme generated and then sold unauthorised Avaya Direct International (ADI) software licenses, which were used to unlock features of a popular telephone system used by thousands of companies around the globe.

The ADI software licensing system has since been decommissioned.

Hines operated Direct Business Services International (DBSI), a New Jersey-based business communications systems provider and a de-authorised Avaya reseller.

He bought ADI software license keys from Brad and Dusti Pearce under his own name and also using an alias, Joe Brown, and then sold them to resellers and end users around the globe.

Brad Pearce, a long-time customer service employee at Avaya, allegedly used his system administrator privileges to generate the keys without authorisation, creating tens of thousands of them that he sold to Hines and other customers.

Brad Pearce's wife, Dusti Pearce, is alleged to have handled accounting for the illegal business.

Hines was by far the Pearces' largest customer, buying over 55 per cent of the stolen licenses, and significantly influenced how the scheme operated.

In fact, Hines was one of the biggest users of the ADI license system in the world. As a result, Hines reaped millions of dollars from the fraud.

Hines pleaded guilty to conspiring to commit wire fraud.

As part of the plea agreement, the United States has agreed not to advocate for more than five years in prison, and Hines must forfeit a money judgment of at least $2m (£1.5m) as well as make full restitution to his victims.

A federal district court judge will determine any sentence after consideration of the U.S. Sentencing Guidelines and other statutory factors.