Makanojiya was just 19 when he started the website in his garage.
An Indian American executive of a popular e-commerce company has pleaded guilty of conspiring to fix prices of customized promotional products, said a press release from Justice Department.
According to the release, Azim Makanojiya, the president of Zaappaaz Inc, has agreed that he has violated the Sherman Act that addresses oppressive business practices associated with cartels and oppressive monopolies.
The felony charges filed in the US District Court for Southern District of Texas have alleged that Makanojiya conducted meetings, both online and personal, with the conspirators.
The charge sheet against Makanojiya said that the top executive had used social media platform and instant messaging apps such as Facebook, Skype, and Whatsapp to reach a price-fixing agreement with the conspirators.
According to the court records, Makanojiya has been found guilty of conspiring to fix the price of customized promotional products sold online, including wristbands and lanyards.
In addition to Makanojiya agreeing to plead guilty, the e-commerce platform Zaappaaz has agreed to pay a $1.9 million criminal fine.
Attorney General Andrew Finch of the Department of Justice’s Antitrust Division said, “As today’s charges show, criminals cannot evade detection by conspiring online and using encrypted messaging.”
“In addition, today’s charges are a clear sign of the Division’s commitment to uncovering and prosecuting collusion that affects internet sales. American consumers have the right to a marketplace free of unlawful collusion, whether they are shopping at retail stores or online,” Finch added.
Acting US Attorney Abe Martinez said that such cases of fraud take a heavy toll on both consumers and sellers who abide by the laws. “The United States will continue to investigate and prosecute individuals and businesses who seek to gain an illegal unfair advantage,” he added.
Special Agent in Charge Perrye K Turner of the FBI’s Houston Field Division said that his agency is committed to protecting the customers from such unscrupulous business practices and the laws of the country are framed for protecting the benefit of all consumers.
Makanojiya is charged with price fixing in violation of the Sherman Act that carries a maximum sentence of 10 years in federal prison and a maximum fine of $1 million for individuals.
Wrist-Band.com was founded by Azim Makanojiya and Zishan Momin when Makanojiya was just 19 and studying computer engineering at the University of Houston.
In a interview with The American Bazaar Makanojiya had said, “Wrist-Band.com was founded as a school business project that my friends and I came up with. We never had envisioned it to be as big as what we currently are.”
The operation of the website started from his home garage, and he managed to support his family financially through the business.
Within one year, the e-commerce website managed to generate $6.9 million and in 2011 it was listed as the 31st on the Inc 500 list of fastest growing companies in the US and specifically in the Houston area.
During the time of its inception, the company was completely managed by two people following which the company hired 30 call center executives and 40 manufacturing employees working from its factory in China.
Wrist-Band.Com owned by the parent firm Zaappaaz Inc offers its customers affordable, customized wristbands. The website says it has more than a thousand elite companies associated with whom they serve quite frequently.
The website also offers customized lanyards, tote bags, vinyl banners, among other merchandise. NASA, Facebook, BMW, Google, Microsoft, Twitter are all listed on the website as their most trusted clients.
Azim Makanojiya was born in Mumbai, India and raised in Houston, Texas. Makanojiya’s father, Amirbanu Makanojiya, previously emigrated to the United States in 1984.