Woman Sentenced For Defrauding Medtronic of $2.1M

Jennifer Rutherford of San Jose, California, admitted to creating shell companies that sold non-existent marketing merchandise to Medtronic, thereby defrauding the company of at least $2.1 million.

A California resident was sentenced Friday to three years and nine months in prison for defrauding Fridley-based Medtronic, Inc., of $2.1 million, according to the U.S. Attorney's Office in Minnesota.

Jennifer Rutherford, of San Jose, California, was charged in May 2011 and pleaded guilty in July to one count of wire fraud. In her plea agreement, Rutherford admitted to selling non-existent merchandise to Medtronic.

Rutherford worked as a senior marketing manager at Kyphon, Inc.-a company that was acquired by Medtronic in July 2007. In her role, Rutherford was responsible for selecting vendors to supply marketing merchandise-including key chains, baseball caps, and T-shirts-that company representatives could distribute at trade shows and industry conferences.

According to the U.S. Attorney's Office, Rutherford created three shell companies and pretended to buy marketing merchandise from those companies. She then allegedly submitted invoices to Medtronic to receive payment for the merchandise, which never existed.

Medtronic paid at least $2.1 million for the non-existent merchandise between 2004 and 2009, and Rutherford kept the money for her personal use, according to the U.S. Attorney's Office.