CEO of election software firm Konnech charged with grand theft by embezzlement

The election software CEO who picked up more than a quarter-million dollars from Michigan Economic Development Corp. funding is facing theft and embezzlement charges in addition to accusations of putting poll worker personal information on a Chinese server.

Eugene Yu, founder and CEO of Konnech, Inc., was arrested with extradition to Los Angeles County pending on Oct. 5. The Center Square previously reported Konnech received $306,000 of Michigan Economic Development Corp. funding last November. This was roughly a decade after Yu's company had gained $247,139 from the U.S. Department of Defense between 2010 and 2011.

Yu is facing felony charges he and his company stole and embezzled more than $100,000 when it stored thousands of Los Angeles County election workers’ personal information on the server based in China. The two complaints were filed earlier this week in the Superior Court of the State of California for the County of Los Angeles.

The charges against Yu are related to Konnech’s contract to provide the company’s PollChief election software with Los Angeles County. The software is designed to manage election-worker payroll, assignments, and communications, and has been used in Wayne County, DeKalb County, Ga., and Fairfax County, Va.

Los Angeles County signed a contract with Konnech in 2019 for $2,645,000. The contract stipulated all personal information would be kept in the United States and handled only by U.S. citizens. That didn’t happen, according to the Los Angeles County prosecutor.

“Based on evidence recovered from a search warrant executed October 4, 2022, the District Attomey’s Office discovered that Konnech employees known and unknown sent personal identifying information of Los Angeles County election workers to third-party software developers who assisted with creating and fixing Konnech's intemal ‘PollChief’ software,” the prosecutor’s complaint reads.

George Gascón, the Los Angeles County prosecutor, previously stated that any alleged wrongdoing by Yu or Konnech would not have altered the tabulation of votes or any election results in any of the areas where Konnech maintains contracts for its software.

The first felony count includes eight alleged conspiracy acts to embezzle public funds.

The second count of the complaint reads as follows: “On or between October 10, 2019 and October 4, 2022, in the County of Los Angeles, the crime of GRAND THEFT BY EMBEZZLEMENT OF PUBLIC FUNDS, in violation of PENAL CODE SECTIONS 503 and 514, a Felony, was commited by EUGENE WEI YU, who fraudulently appropriated public funds exceeding nine hundred fifty dollars ($950) in value, and/or secreted those funds with a fraudulent intent to appropriate them, while serving as an officer of a county, or a deputy, clerk, or servant of that officer, specifically, as a contractor for Los Angeles County for Los Angeles county, to a use or purpose not in the due and lawful execution of his trust, in his possession and or under his control by virtue of that trust, was an officer of a county, or a deputy, clerk, or servant of that officer, specifically, contractor for Los Angeles county, and, who fraudulently appropriated to a use or purpose not in the due and lawful execution of that trust, public funds in his possession and/or under his control by virtue of that trust, and/or secreted those: funds with a fraudulent intent to appropriate them. The funds amounted to $2,645,000, plus the as yet undetermined value of the personal identifying information, thus exceeding nine hundred fifty dollars ($950).”

According to the New York Times, Yu could face up to three years in prison on the charges of grand theft as well as an additional five years due to the contract with Los Angeles County exceeding $2 million.