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IT Factory then obtained leasing contracts financing the fake purchases. About half the leasing funded money paid to the partner was spent on purchases of software from IT Factory, thus inflating company earnings. The leasing contracts were not considered debts under the accounting standards used, so IT Factory looked lucrative on paper, and because the leased goods were fictional, each "partner" was left with about half the price as personal profit. Since each fraudulent transaction was for such a large amount, only a relatively small number of fake documents would be needed to pull off the $ 200 million scam.
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Investigations revealed that Bagger employed a duping scheme by forging large sales orders creating fictional revenue. In the scheme, real and fictional overseas "partner" companies sold non-existent large hardware and software bundles (such as a complete $ 10 million hosting center) to IT Factory,
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and threats towards his family, forcing him to take fraudulent steps in order to raise revenue to secure his family. However, many critics doubt the veracity of those statements. Bagger was held in US custody until his extradition to Danish legal authorities. On
December 16, he was extradited to
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from "San
Francisco Technical University". No such university exists. After reporters inquired about the alleged degrees, Bagger hired an American actress to impersonate an official of the fake university, to "verify" his degrees.
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with his wife and business colleagues. On 1 December, information emerged indicating that IT Factory's revenue had been artificially inflated and a leasing scam had defrauded banks and private investors for over 875 million
111:. On the 11 June 2009, Stein Bagger was sentenced to a seven-year prison sentence. He was released on license on 24 March 2014, having served approximately 5 years of his sentence.
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convicted criminal, former entrepreneur, former CEO of IT Factory. Before bankruptcy of IT Factory and a subsequent fraud scandal, he was named "Danish
Entrepreneur of the Year" by
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on 6 December 2008. Bagger had reportedly left Dubai on a plane destined for New York where he borrowed a car from a
Swedish friend,
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in recent decades. As a result, Bagger was charged with fraud and forgery, and a warrant for his arrest was put out by
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185:(and later repeated in an interview and apparently in court), he had allegedly been a victim of systematic
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Stein Bagger claimed that he had several academic degrees, including an
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Lin II, Rong-Gong; Blankstein, Andrew; Larrubia, Evelyn (2008-12-07).
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367:"Email to Actress Hired to Play Role of University Official"
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Bagger disappeared on 27 November 2008, while on a trip to
349:"For Denmark's Entrepreneur of Year, Something Was Rotten"
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Stein Bagger turned himself in to US police in downtown
190:Denmark and jailed pending further investigations.
132:), making this the biggest financial fraud case in
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385:"Fugitive Danish IT Chief Surrenders to LA Police"
244:"Where In The World Is IT Factory's Stein Bagger?"
27:Danish convicted criminal and former entrepreneur
479:"Sådan foregik Stein Baggers million-svindel"
8:
218:"Stein Bagger løsladt: Hvor er millionerne?"
411:"Danish fugitive turns himself in to LAPD"
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529:People extradited from the United States
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347:Higgins, Andrew (17 December 2008).
458:"Stein Bagger erklærer sig skyldig"
273:"Nye skeletter venter i IT Factory"
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294:"Tab efter Bagger eksploderer"
165:Re-emergence and incarceration
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99:(born January 20, 1967) is a
534:People extradited to Denmark
485:. 2008-12-01. Archived from
437:"Grædende Bagger: Undskyld"
216:Steengaard Nielsen, Trine.
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275:. business.dk. 2008-12-06
115:Disappearance and charges
524:Danish chief executives
371:The Wall Street Journal
353:The Wall Street Journal
173:at approximately 21:00
158:International Business
80:Seven years in prison
373:. 17 December 2008.
298:Berlingske Tidende
224:. Berlingske Media
72:Convicted Criminal
36:(Now: Sten Hansen)
105:Ernst & Young
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34:Magnus Bagger
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128:(186 million
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55:(age 57)
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491:. Retrieved
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256:. Retrieved
252:the original
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226:. Retrieved
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144:Fake degrees
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97:Stein Bagger
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514:1967 births
248:Channel Web
171:Los Angeles
61:Nationality
508:Categories
493:2011-02-16
464:2009-01-05
443:2009-01-05
422:2008-12-29
395:2008-12-29
333:2008-12-29
304:2008-12-29
279:2008-12-29
258:2008-12-29
203:References
130:US dollars
69:Occupation
49:1967-01-20
18:IT Factory
187:extortion
416:LA Times
389:PC World
323:Interpol
228:24 March
138:Interpol
134:Denmark
85:Partner
152:and a
101:Danish
64:Danish
483:ComOn
121:Dubai
230:2014
183:blog
43:Born
175:GMT
156:in
154:PhD
150:MBA
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