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January 31, 2023

Accountants Behaving Badly: Ex-Marks Paneth Partner Going to Prison, Duluth Chamber Thief Faces New Charges, Selling Unregistered Securities

Plus, an ex-IT accountant in Tokyo was arrested for allegedly embezzling more than 10 million yen, and a Portuguese accountant is accused of having aided illegal immigration and falsified documents.

Prison sentence for $2M Westchester fraud marks former Stamford CPA’s fall from grace [Westfair Online]
Steven L. Henning, a former partner-in-charge of a litigation group at Marks Paneth Accountants & Advisors in Manhattan, was sentenced to federal prison for more than four years for operating a $2 million intellectual property fraud in Westchester County, NY.

Steven Henning

Henning was sentenced on Jan. 30 to 51 months in prison and three years of supervised release and was ordered to pay back $938,246 to his victims.

In 2008, while working for Marks Paneth, he formed an intellectual property business that eventually became known as OpportunIP, with offices in Tarrytown and Purchase, NY.

From 2012 to 2017, according to court records, he persuaded two people to invest $2 million in the company. He used phony licensing agreements for deals that did not exist and fabricated bank account statements purporting to show more than $2.5 million in assets he did not have.

Henning moved on to Global Economics, an accounting firm in Chicago where, authorities said, he “continued his charade.” Henning was ordered to surrender to the federal Bureau of Prisons on March 23.

Duluth accountant faces additional theft charge [Duluth News Tribune]
Jesse Frye, who is accused of swindling more than $235,000 from the Duluth Area Chamber of Commerce, is facing a second felony charge of theft by swindle after authorities said on Feb. 10 he stole more than $122,000 from an undisclosed business.

Jesse Frye

The thefts allegedly occurred between June 14 and Dec. 27, 2019. Investigators were able to trace the money, in some instances, to “dollar-for-dollar purchases” of expensive items such as a car and a new roof on a residence.

Frye, 39, owner of Eagle Accounting in downtown Duluth, MN, was initially charged on Dec. 23 with stealing from the Duluth Chamber.

The theft was discovered in July during an outside audit of the Chamber’s financial record. Chamber officials said they contacted the Duluth Police Department to investigate after a review of 2018 finances “identified discrepancies in the bookkeeping and payroll records completed by the Chamber’s bookkeeping and payroll contract service provider.”

Sterling man charged with selling unregistered securities [Telegram & Gazette]
Ronald Leger, CPA, was charged on Feb. 10 with selling more than $2.5 million in unregistered securities to Massachusetts investors.

Ronald Leger

Leger is alleged to have been selling investment products known as life settlements as far back as 2010. Leger never registered nor did he register any of his companies with the state Securities Division.

Through his firm New England Alternative Investments Inc., Leger allegedly sold millions of dollars in investments offered by Texas-based Life Partners Inc. to investors in Massachusetts and other states, earning hundreds of thousands of dollars in commissions. The Texas company filed for bankruptcy in 2015, after being ordered by a federal court to pay $46.9 million in penalties and restitution for violations of federal securities laws.

Other accountants behaving badly:

  • Ex-accountant at IT firm suspected of using embezzled funds for trips [Tokyo Reporter]
  • Faro accountant arrested for assisting illegal immigration [Portugal Resident]
  • Former GRDB accountant gets three years for $145M omission from ledger [Stabroek News]
  • Melbourne accountant pleads guilty [Mirage News]
  • Third Anglo accountant is expelled by Institute [Independent.ie]
  • Deputy accountant arrested over corruption [The Nation]
  • Accountant permanently banned for dodgy behaviour [MyBusiness]

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