ST. GEORGE Walt Pavlo, a former mid-level manager at MCI, recounted his meteoric rise within the telecommunications giant and his equally stunning plunge into the seedy world of money laundering and wire fraud to audience members at the Washington County Economic Summit in St. George on Wednesday.
"I grossly underestimated the pressure of being involved in something like that," Pavlo, the summit's keynote speaker, told more than 900 people attending the yearly event billed as "What's Up Down South." "I knew I was leading a double life, but I underestimated the power of my own conscience."
Pavlo was responsible for billing and collections in the company's reseller's division in Atlanta, a job that involved nearly $1 billion in monthly revenue for MCI's carrier finance division. Those customers, Pavlo said, raked in the cash selling prepaid calling cards to various ethnic groups and charging exorbitant rates to link customers to telephone numbers tied to the adult entertainment industry.
In 1996, as his customers began to fall behind on making their monthly payments, Pavlo said he and a fellow staff member and an outside business associate concocted a scheme to force customers to pay their bills through an intermediary.
"We set up a customer sting and pressured them to pay up or be disconnected," Pavlo said, adding he knew each customer would be desperate to keep the telephone lines open with MCI in order to continue making money. "That's when we sent our angel investor in."
Deals were set up with seven customers of MCI, he said, defrauding MCI of $6 million in cash that was sent in payments to a bank in the Cayman Islands. When a minor auditing error was noticed at work, Pavlo said, he became paranoid and quit his job, fearing the worst. Within weeks, the FBI launched an investigation.
"I was afraid. I didn't want to go to prison," Pavlo said. "I wondered if I couldn't just say, 'I'm sorry' or ask if there was something else I could do. But there are severe consequences for white-collar crime."
In 2001, Pavlo pleaded guilty to wire fraud, money laundering and obstruction of justice, and served two years in a federal prison. While there, an FBI agent sought him out as a speaker on the ramifications of white-collar crime and the ethical decisions that people face every day in the workplace, he said.
"Initially, I saw this as a victimless crime. I didn't see victims like the shareholders or my family," said Pavlo, telling the crowd he lost everything he had, including his family, as a direct result of his actions. "Your family can accept the fact that you have a terminal disease easier than the news that you're going to prison."
Pavlo, who holds an engineering degree from West Virginia University and an MBA from Mercer University, said he still wonders why he did something so wrong.
"I'm not a bad person," he said. "The reason I enjoy speaking to groups and telling my story is because I want to protect the person, those people in the workplace, from temptation. Many of us know someone who fell short."Pavlo has written a book, "Stolen Without a Gun," detailing his experience and now speaks nationwide about his former life of crime.