According to the Plea Agreement, from January 1998 to January 1999, Memory X, a company in San Jose, California, engaged in the business of selling computer components to purchasers in the United Kingdom, participated in a scheme to defraud Customs Officials of the U.K.  The scheme involved Memory X issuing "double invoices" for merchandise ordered and shipped to the U.K.  One invoice, quoting a falsely low value for the goods, was created and shipped with the goods to fraudulently lower the assessed value of the goods, for which a Value Added Tax ("VAT") of 17.50% was to be paid by the U.K. purchaser.  A second invoice, reflecting the true value of such goods, was sent to the purchaser separately for full payment.

In pleading guilty, Memory X admitted that it assisted its U.K. purchasers in VAT evasion of an estimated $5.2 million.  A number of the purchasers were prosecuted and convicted in the United Kingdom.  Memory X's conviction follows the 2002 conviction of another San Jose company, Advance Computer Link that participated in the same scheme.

The prosecutions are the results of a joint investigation between agents of Immigration and Customs Enforcement (ICE) and the authorities of the United Kingdom.   Scott Tsui, a Santa Clara County Deputy District Attorney appointed as a Special Assistant U.S. Attorney, prosecuted this case.