October 5, 2022

Accounting News Roundup: IRS Agent Sniffs Out Drug Lord; Ex-KPMG Partner Talks About Insider Trading; Rebranding the CPA | 12.28.15

Ed. note: We're taking it easy this week, so posting will be on the light side. News roundups and the occasional post will appear along with any breaking news. If you see anything newsworthy, email us or drop it in Open Items for discussion.

The Tax Sleuth Who Took Down a Drug Lord [DealBook]
This is a great story about Gary Alford, an IRS agent who was working with the DEA on the investigation into Dead Pirate Roberts, the founder of Silk Road. Alford's work was key to identifying DPR as Ross Ulbricht who was sentenced to life in prison earlier this year. 

An Insider Trader Tells All [Planet Money/NPR]
Last week, ex-KPMG partner and convicted insider trader Scott London's story was featured on Planet Money and it's a pretty great interview. London's candor about his case is admirable; he even suggests that being "overworked and unhappy with his job" may have been part of the reason he participated in the scheme with his then-friend Brian Shaw.

KaloBios Loses its CFO and Accounting Firm After Shkreli's Arrest [Fortune]
According to last week's 8-K, Marcum was KaloBios' auditor for a grand total of 13 days:

On December 21, 2015, the Company was notified by its independent registered public accounting firm, Marcum LLP (“Marcum”), that Marcum has resigned as the Company’s independent registered public accounting firm. Marcum’s resignation was not due to any reason related to the Company’s reporting or accounting operations, policies or procedures. Marcum was engaged by the Company as the Company’s independent registered public accounting firm on December 8, 2015, and accordingly, Marcum has not provided a report or completed any review on any of the Company’s consolidated financial statements.

Another 8-K was filed today disclosed that two board members, Tom Fernandez and Marek Biestek, resigned yesterday.

PwC audit found no problems at Third Avenue's failed junk bond fund [Reuters]
Does this sound like a junk bond fund that was planning to liquidate?

"We believe there is significant upside in the fund as the fundamentals of the credits in the portfolio are healthy and positioned to capture significant upside as market conditions normalize," according to the Focused Credit Fund's portfolio management discussion. The comments reflect the fiscal year that ended Oct. 31.

Not really, does it? So I guess PwC believed them despite "heavy losses and encountering an accelerated amount of investor withdrawals."

PwC's audit opinion, released Dec. 24th, is contained in the annual report for the Third Avenue Focused Credit Fund. The fund's fiscal year ended Oct. 31, before its liquidation was announced on Dec. 9th.

"Our opinion is not modified with respect to this matter," PwC said, referring to the junk fund's liquidation.

Seems a little weird.

In other news:

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