In 1993, Geis went back to selling computer hard drives. He ran the business out of his apartment, this time using the online service CompuServe to make his sales connections. He marketed his wares under the moniker Ram This, which quickly expanded into memory, monitors, and used computers. Geis says he was making $10,000 per month.
Then one day one of his customers asked him if he could build a computer from scratch. “I lied and said sure,” Geis says. He collected all of the components in his apartment, only to realize he had no idea how to assemble them into a working machine. So he called his brother Bill, who coached him through the process as he fiddled with wiring, precision screwdrivers, power supplies, motherboards, and disk drives in his living room on a spread of cheap office desks. “I put it all together and blew the thing up. Twice,” Geis says. “Smoke, the whole nine yards.” He got the assembly process down on his third try.
He began building computers by the dozen in his apartment. “I couldn’t believe I could build a PC in 30 minutes and make five, six hundred bucks,” he says. “I went balls out.”
He bought full-page ads in Computer Currents magazine, and his business exploded. He leased office space in Arlington next to Six Flags. It wasn’t long before he expanded into bigger offices and added a warehouse. In March 1995, he launched Ram Technologies Group in Melbourne, Florida, a small computer manufacturer and retailer that built a customer portfolio that included Hughes Aircraft, Rockwell International, and Northrop Grumman. “We kicked ass, took names out there,” he says. “And then everything went to shit.”
Ram Technologies got trampled, Geis says, in the stampede caused by Microsoft’s August 1995 launch of Windows 95, among the most successful software releases of all time, with North American sales topping 1 million units in its first four days on sale. But users soon learned the operating system was plagued with bugs that led to frequent crashes and installation failures. Microsoft chairman Bill Gates cast blame on faulty computer systems. Others were more blunt, fingering off-brand PC clones like the ones Geis was building and selling.
As a memory hog, Windows 95 demanded machines muscled up with memory chips, exacerbating an already acute global chip shortage triggered two years earlier by a fire that destroyed the Sumitomo Chemical plant, supplier of 60 percent of the world’s computer chip casings. A combination of spiking chip prices, order backlogs, and shifting consumer sentiment about PC clones dragged Ram Technologies under. Geis was forced to shutter the company three weeks before Christmas 1995. He blamed Microsoft. He wanted blood.
===“Once you make that first step into darkness, you just keep trudging along, and it gets easier and easier to make the next one,” Geis says. “At first I’d say it was 70 percent vengeance and 30 percent greed. Then it went to 90 percent greed and 10 percent vengeance.”!==
Eight weeks after the failure of Ram Technologies, quite by accident, Geis stumbled across the tool to exact his revenge. He had pulled in his horns and transformed his business into a wholesale software supplier with a sales team comprised of computer geeks: Marc Tager, Eddie Sass, Scot Jaworoski, and Roger Dale Miller. And then one day he found a cracked jewel case containing a copy of Microsoft Office. On the back was a toll-free number for ordering a replacement. He called the number. “Two days later, Airborne Express came with the new CD-ROM,” he says. So he called the number again. The customer service rep asked him how many he wanted. Two, he said.
Two days later, Airborne delivered the two copies of Microsoft Office. So Geis called back a third time. It seemed like a harmless game at first, just asking for more software and having them send it along for free. So this time, when the rep asked him how many copies he wanted, he said 500. Surely, it would end there, he thought. But two days later, his order arrived. And now Geis got quite serious about it. He called back and ordered 10,172 copies of Microsoft Office.
“And two days later,” he says, “the first thing we heard was beep, beep, beep. What’s that? We were shellshocked when a semi backed up to our warehouse with pallets and pallets of software.”
Geis was paying $8 to $12 in handling charges for each piece of “replaced” software, which he promptly resold to small retailers for $125 a pop—far less than Microsoft’s $200 to $300 per unit licensing fees. “We received them. We sold them. We made hundreds of thousands of dollars,” Geis says.
He took his proceeds and bought an Arlington McMansion, putting $297,000 in cash down on a $600,000 house. “That was a trip,” he says. “I was living the good life.”
Geis figured he’d found an unguarded bank vault and looked for other ways to exploit Microsoft’s weakness, to carry off even larger hauls of money. While throwing back Red Bull and vodka at Club 426 in Aspen, he and his partners dreamed up another scheme. This time he zeroed in on Microsoft’s upgrade policy. Within a six-month window prior to the release of Office 2000, purchasers of Microsoft Office 97 could upgrade to the new edition for $7.50, plus their Office 97 box top and a sales receipt. So Geis and his partners devised a plan to meet the upgrade requirements by mailing in bogus box tops and receipts.
Geis contracted with a printer and ordered thousands of Microsoft Office box tops, which he then tore himself so they’d look authentic. To fulfill the receipt requirement, he set up banks of computers programmed to print thousands of unique sales receipts—every one of them bogus. He systematically sent orders to Microsoft for batches of 20 to 2,200 pieces in an attempt to determine how large an order he could slip through the company’s fraud detection system. All told, Geis ordered 36,000 Office 2000 upgrades, selling them for $215 a piece.
“Once you make that first step into darkness, you just keep trudging along, and it gets easier and easier to make the next one,” Geis says. “At first I’d say it was 70 percent vengeance and 30 percent greed. Then it went to 90 percent greed and 10 percent vengeance.”
But even Geis says he had doubts about the next scheme, designed by Tager, Miller, and Jaworoski to exploit Microsoft’s Easy Fulfillment/Open License Program. The program allowed companies that purchased multiple user licenses to obtain software on an as-needed basis. To execute it, they set up fake companies and fake business banks, the latter to establish the legitimacy of the bogus companies and verify the necessary funds for huge software orders from a Microsoft distributor. Once verified, the vendor would then obtain a license number for a large number of users and ship the software to the fake companies.
Geis and his cronies quickly flushed the software into the retail market and canceled the license numbers to avoid the payment obligation, which ran into the millions. Through this scheme, the conspirators obtained thousands of copies for nothing but nominal fees. At their most brazen, the group represented themselves as purchasing agents for well-known companies such as International Paper and Hunt Oil.
“The way it worked was just out of control,” says one of the conspirators. “It was an endless cash supply if you had a license number.
===The Hollywood script for the story would have Geis, drunk with his greed, slipping up with a careless mistake. It’s a cliché. And that’s exactly what happened.!==
The Hollywood script for the story would have Geis, drunk with his greed, slipping up with a careless mistake. It’s a cliché. And that’s exactly what happened. At least one of his cronies blames Geis for putting the operation on the fed’s radar by dumping tens of thousands of dollars in cash into his bank accounts. “There was a big greed thing involved,” says a former Geis cohort who spoke on condition of anonymity. “He lived a lavish lifestyle. He was a player—jewelry, clothes, girls—a very conniving person.”
Geis launched and funneled money into a variety of businesses, including an Aspen limousine company that was one of the first to convert Hummers into stretch limos. He flew to Hawaii with his then girlfriend Paula Rego and shopped for million-dollar beach houses. When his father died in 1997, Geis leased a Learjet and flew his family and friends from Wisconsin to Aspen to ease their grief.
Geis admits to being oblivious, ignoring warning signs such as the UPS driver who forwent the signature brown uniform in favor of a bright red shirt and a fanny pack. Or the cars in his Arlington office parking lot with county sheriff’s jackets draped over the seats. Or the power drills he heard whirring in his office ceiling, emanating from the office above, ostensibly to install monitoring devices.
“We figured they were so freakin’ big, and I found so many more loopholes in their system, and Microsoft was exploding so fast that they had no idea what one branch was doing to the other,” Geis says. “As long as they continued to grow like that, I thought that we could continue to get away with it.”
While visiting his mother in Eagle River, Wisconsin, Geis got a call from Roger Dale Miller. “The worst thing you can possibly imagine has happened,” Miller said. “The feds are here.” Geis laughed. “I thought he was full of crap and I asked to speak to the agent, thinking it would be another friend disguising his voice,” Geis says. Special Agent Allyn Lynd, a member of the FBI’s Dallas Cyber Squad, got on the line. He demanded Geis return to Dallas within 24 hours.
Geis lawyered up, thinking he would beat charges by “pulling an OJ.” “Of course, you can’t beat the feds,” he says. He believes that because he fought, he received the stiffest sentence among the clan. In October 2001, after pleading guilty to conspiracy to commit mail fraud, Geis was sentenced to 46 months in federal prison. He lost his house. He sold his Range Rover and BMW to pay legal bills. His bank accounts with more than half a million in cash were seized. He was ordered to pay $17.8 million in restitution.
Yet despite spending most of his 30s confined in federal prison cells, Geis insists his bad doesn’t go bone deep. “I may be a cad, a scoundrel, and a fraud when it comes to Microsoft,” he writes, “but not to friends, nor family.”
===“I may be a cad, a scoundrel, and a fraud when it comes to Microsoft,” he writes, “but not to friends, nor family.”!==
Geis was released from the federal prison in Texarkana in December 2004 after serving 40 months of his 46-month sentence. Little more than a year after our first meeting in April 2005, when he refused to speak on the record of his crimes, he was cuffed and dragged by FBI agents from the downtown offices of E-Centric, a network technology firm where he worked as a sales manager. In April 2007, he was sentenced to 70 months in prison after he pled guilty to trafficking in counterfeit Cisco network routers worth some $4.2 million.
Despite his guilty plea, though, Geis maintains his innocence. His sister Kerri says, “Mark called crying, saying, ‘I didn’t do it. I swear I didn’t do it.’” This was in contrast, she says, to his penitent confession following his arrest in the Microsoft crime. “‘I did it. I screwed up. I need to be punished,’” she remembers him saying. “That’s Mark. When he does something wrong, he’s the first to admit it.” His mother sketched plans to put her house up for sale to cover his latest legal bills.
Geis insists FBI Special Agent Lynd, the same agent who busted him for his Microsoft crime, framed him. “I was forced to admit this during a plea hearing in a manner that can only be described as akin to torture,” Geis writes in his report titled “A Verified Dossier on the Criminal Acts of FBI Special Agent Allyn Lynd.” He says prosecutors threatened him with a 20-year sentence if he didn’t cop a plea. He’s waging an uphill battle to reverse his conviction before his scheduled March 2011 release.
Thus, his strange trip lands him in Duluth, where he sits, mulling his limited future. Geis vows he’ll never start another company. “I have so much fear, just from being a target again,” he says. He’s been offered jobs teaching university courses on business ethics, he says. He contemplates lecturing and consulting on corporate fraud, a la ZZZZ Best carpet-cleaning fraudster Barry Minkow. But he says he doesn’t have a clue as to what’s next.
“God, I hope he gets out and gets a decent job,” says his brother Bill. “Something legitimate for crying out loud.” Write to [email protected] .