Michael Musacchio, Corporate Hacking, Texas 2013

DALLAS, Texas – In a high-profile case, Michael Musacchio, 62, of Plano, Texas, was sentenced to serve a total of 63 months in federal prison for conspiring to hack into his former employer’s computer network. Musacchio was convicted on one felony count of conspiracy to make unauthorized access to a protected computer (hacking) and two substantive felony counts of hacking.

The scheme, which took place between 2004 and 2006, involved Musacchio and two other former Exel employees, Joseph Roy Brown, 39, of Collierville, Tennessee, and John Michael Kelly, 43, of Plano, Texas. Brown and Kelly were also involved in the hacking conspiracy, with Brown being sentenced to 12 months and one day in prison, and a 12-month term of probation, respectively.

According to the evidence submitted at trial and plea papers filed in the case, Musacchio was the president of Exel Transportation Services, a third-party logistics or intermodal transportation company, from 2000 to September 2004. After leaving Exel, Musacchio formed a competing company, Total Transportation Services, where he was the original president and CEO. Brown and Kelly also joined Musacchio’s new company.

Between 2004 and 2006, Musacchio and Brown assisted by Kelly, engaged in a scheme to hack into Exel’s computer system to conduct corporate espionage. Through their repeated unauthorized accesses into Exel’s email accounts, Musacchio and Brown were able to obtain Exel’s confidential and proprietary business information and use it to benefit their new employer and themselves as investors.

This was the first investigation of hacking for the purpose of corporate espionage conducted by the Computer Crime and Intellectual Property (CCIP) Section, the U.S. Attorney’s Office for the Northern District of Texas, and the FBI.

The FBI Dallas Field Office was in charge of the investigation. Deputy Criminal Chief Assistant U.S. Attorney Linda Groves and Assistant U.S. Attorney Candina Heath, of the U.S. Attorney’s Office for the Northern District of Texas, and Trial Attorney Rick Green of the Criminal Division’s CCIP Section, prosecuted the case.

Musacchio was ordered to surrender to the Bureau of Prisons on December 4, 2013. The issue of restitution is still under consideration by the court.

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