A former Home Depot manager will plead guilty to wire fraud and other charges in a kickback scheme to make money by connecting foreign flooring suppliers with buyers who chose products for the giant retailer, his lawyer said Thursday.
Anthony Tesvich, 42, will plead guilty to three counts of tax evasion and one count of conspiracy to commit wire fraud, perhaps as early as today, said Brian Steel, one of his attorneys.
Tesvich smiled and joked with his attorneys during a brief hearing Thursday before U.S. Magistrate Gerrilyn Brill. She bound the case over to U.S. District Judge Richard Story.
Story will set a hearing date for Tesvich to enter his guilty plea "probably as soon as his calendar allows," said Assistant U.S. Attorney Russell Phillips.
Tesvich faces up to 35 years in prison and a minimum fine of $250,000, plus restitution to Home Depot. He is free on a $10,000 bond.
A civil complaint filed Jan. 8 by U.S. Attorney David Nahmias in Atlanta alleges Tesvich took payoffs from foreign vendors to ensure those vendors' products were chosen for display in Home Depot stores.
After Tesvich left the company, the complaint alleges, he also gave substantial cash payments —- which he code-named "french fries" and "milkshakes" —- to co-conspirator employees at Home Depot. The scheme occurred between October 2002 and October 2007, according to court documents.
Prosecutors haven't disclosed the status of their investigation of any other ex-employees, although federal authorities have said they have seized assets from one former manager named in the complaint and put liens on the property of another. Home Depot last year said it had fired four managers in connection with the matter.
The civil complaint further alleges Tesvich evaded federal taxes from 2003 to 2005 on his fraudulent income, totaling more than $1.4 million in unpaid taxes.
Part of a product buyer's job is to travel overseas to develop relationships with vendors with lower-cost, high-quality products. The buyers determine which products make it to Home Depot's shelves.
Home Depot has since changed its gift policy from $50 to zero tolerance.
"Maintaining our ethical standards is of utmost importance to the Home Depot," company spokesman Ron DeFeo said Thursday. "We're pleased to cooperate with the U.S. Attorney's Office to help bring the matter to this point."
The case is being investigated by the IRS, the Bureau of Alcohol, Tobacco, Firearms and Explosives and the FBI. Home Depot has cooperated in the federal investigation, according to the Department of Justice.
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