Your Naughty IRS Employee of the Day
Deena Vang Lee of Fresno, CA, was indicted in April 2019 and charged with wire fraud, aggravated identity theft, aiding and assisting in the preparation and presentation of false and fraudulent tax returns, and making and subscribing false and fraudulent tax returns. She was accused of preparing family and friends’ returns for a fee that […]
Fourteen People Who Inspired Future Tax Criminals in 2022
The IRS Criminal Investigation unit has released its top cases for 2022 and in it we get reality TV personalities, a rogue tax preparer, some garden variety PPP fraud, and even a former decathlete with his own Wikipedia page. Pretty sure some of these people showed up in Accountants Behaving Badly, an irregular feature we […]
No One Should Be Surprised to Learn FTX Used QuickBooks
Before the House Committee on Financial Services on Tuesday, recently-appointed FTX CEO John J. Ray III gave testimony to back up comments he made to the New York Times last month about FTX being a “complete failure” the likes of which he hadn’t seen in two decades. Back in the day, Ray was chairman of […]
Accounting Fraud Watch: Ex-Wirecard CEO’s Trial, Cronos Gets Smoked, Bad PR for Ex-PR Firm CFO
The Fall of Wirecard, a Tech Scandal That Rocked Germany, Reaches a Courtroom [New York Times] The fraud trial of former Wirecard CEO Markus Braun began in Munich on Dec. 8. Braun and two other former executives face charges of defrauding creditors of $3.7 billion, through false accounting from 2015 until Wirecard collapsed in June […]
Friendly Reminder: If You Are Going to Commit Fraud For Clients, Charge More
Remember the Chrisleys? The flamboyantly wealthy TV couple Todd and Julie Chrisley of Chrisley Knows Best? On Monday, Todd was sentenced to 12 years in prison and Julie to seven years for an assortment of crimes like fraud, tax evasion, and conspiracy to defraud the United States. Also tied up in this bonanza of federal […]
Crazy Eddie: They Don’t Fraud ’Em Like That Anymore
Whenever I meet someone who grew up on the east coast in the late 70s or early 80s, I ask if they remember Crazy Eddie. I have yet to hear a response other than, “Of course!” To many, the story of Crazy Eddie is a story of loving to hate a television commercial. The Crazy […]
Guy Blames Failing the CPA Exam on Why His Clients Got Busted for Bank Fraud and Tax Evasion
Hanlon’s razor states “never attribute to malice that which is adequately explained by stupidity.” Meaning most of the time when someone does something bad, it’s not because they’re a bad person, rather too stupid to know better. Or something. Socially anxious people with victim complexes — who no doubt make up a large portion of […]
Accountant Behaving Badly: There’s a Special Place In Hell For Someone Who Steals $800,000 From an Elderly Client With Dementia
Hey! Have you guys listened to “Oh My Fraud” yet? It’s a new podcast on the Earmark CPE platform hosted by our good friends Caleb Newquist and Greg Kyte. And Earmark CPE was created by another pal of Going Concern’s—Blake Oliver. The latest episode of “Oh My Fraud” is about the massive fraud in Dixon, […]
Exposure Drafts: The ACFE Implies That You Should Include Jail Time On Your Resume
Listen to Oh My Fraud, a new podcast by Caleb Newquist and Greg Kyte, and get free CPE through Earmark.
Accountants Behaving Badly: Fraud Isn’t All It’s Cracked Up to Be
I never thought I’d ever write the words “egg accountant busted in embezzlement scheme” but here we are. The egg accountant, Jonathan Weston, was indicted by a federal grand jury in Pittsburgh June 3 on charges of fraud conspiracy, money laundering conspiracy, and tax fraud. According to the U.S. Attorney Office for the Western District of […]
Number of the Day: 43%
The Anti-Fraud Collaboration—a partnership between the Center for Audit Quality, Financial Executives International, The Institute of Internal Auditors, and the National Association of Corporate Directors—sifted through more than 530 SEC Accounting and Auditing Enforcement Releases (AAERs) filed between 2014 and 2019 for its newly released report, Mitigating the Risk of Common Fraud Schemes: Insights from […]
‘Reality Star’ Charged With Fraud Says the Government Totes Didn’t Make It Clear That PPP Loans Weren’t Meant for Cars and Jewelry
A mere two weeks ago we saw the first of what promises to be many, many PPP loan fraud charges when a pair of fine, upstanding gents from Rhode Island were nabbed by the Department of Justice. David A. Staveley, aka Kurt D. Sanborn, 52, of Andover, MA, and David Butziger, 51, of Warwick, RI, […]
Accounting Fraud Watch: Luckin Cleans House, Wirecard’s Woes, Ex-Penn West Execs Pay Up
Luckin Coffee sacks CEO, COO for alleged fraud [Reuters] Chinese coffee chain and Starbucks wannabe Luckin Coffee fired its CEO Jenny Zhiya Qian and COO Jian Liu following an internal investigation on the fabrication of annual sales numbers, the company said on May 12. Luckin revealed in April that much of its 2019 sales of […]
KPMG Takes Victory Lap In Merrimack College Financial Aid Fraud Case
Merrimack College suffered two defeats on/in court yesterday. Its men’s basketball team got blown out by the Providence Friars 93-56. And it lost a case in a courtroom in Massachusetts to KPMG, although the jury found that KPMG wasn’t completely blameless in the student loan fraud case. Law360 reported: A Boston jury said negligence by […]
Accounting Fraud Watch: Under Armour’s Messy House?, Former Soccer Club Chairman Convicted, Ex-Comscore CEO Fined
It’s been a while since we’ve posted an Accounting Fraud Watch, but there’s news to share, starting with Under Armour’s possible shady accounting. Five things to know about the federal investigation into Under Armour [Baltimore Sun] The Wall Street Journal broke the story on Sunday about Baltimore-based Under Armour’s accounting practices being investigated by the […]
Accounting Fraud Watch: Disney’s Magic (Accounting) Kingdom and Ex-SEC Chief ‘Suspicious’ of GE Report
Our pal Francine McKenna at MarketWatch broke a pretty big news story today regarding an accountant who blew the whistle on Walt Disney Co. Disney whistleblower told SEC the company inflated revenue for years [MarketWatch] According to the whistleblower, Sandra Kuba, a former senior financial analyst in Disney’s revenue operations department who worked for the […]
Accounting Fraud Watch: GE Bigger Than Enron?, Brixmor Bad, SEC Piles On Power Solutions Execs
A certain report about General Electric caused quite the uproar yesterday. GE falls the most in 11 years after Madoff whistleblower calls it a ‘bigger fraud than Enron’ [CNBC] Boy, did Harry Markopolos send shares of GE into a tizzy on Aug. 15: Markopolos targeted the conglomerate in a new report, accusing it of issuing […]
Accounting Fraud Watch: Autonomy Trial, Patisserie Valerie Arrests, Longfin CEO Charged
Plus, Patisserie Valerie’s ex-chairman doesn’t have nice things to say about Grant Thornton and Steinhoff warns of lingering damage from massive accounting fraud. Lynch says HP’s Meg Whitman couldn’t cope with ‘all the fires’ [Bloomberg] On his first day of testimony, Autonomy founder Mike Lynch said Hewlett-Packard Co.’s executives made him a scapegoat for their […]
Former Marks Paneth Partner Admits to Screwing Investors Out of $2 Million
Steven Henning, CPA, a former partner-in-charge of advisory services at New York City-based Marks Paneth, could have as long as 20 years to think about his choices: Steven Henning pled guilty today [June 24] to participating in two wire fraud schemes. In the first, he falsely claimed to have entered into multimillion-dollar intellectual property deals […]
Have You Been Approached By a Colleague to Participate In a Fraud?
Good morning, GCers. Some friends of ours at the University of Illinois at Urbana-Champaign and Queen’s University in Kingston, Ontario are conducting research on group fraud and other highly unethical acts, and we’re hoping you can do them a solid and help them with their project. While I’m sure they wouldn’t pass up an opportunity […]
Accounting Fraud Watch: Deloitte Malaysia Office Raided, Ex-Autonomy CFO Jailed, GT Advanced Technologies Settles
Here’s some news on accounting frauds and scandals from the last couple of weeks that you might have missed. Malaysian police raid Deloitte office for 1MDB-related documents: sources [Reuters] Even though this is more scandal than fraud, whenever a Big 4 firm gets raided by police, we’ll fit it in somehow. This happened today: Malaysian […]
5 Crazy Fraud Stories You Would Never Believe (If They Weren’t True)
From Russian government assassinations to multimillion-dollar blood-testing scams, there’s never a shortage of surreal fraud stories to rock the financial industry each year. And each year, the Association of Certified Fraud Examiners (ACFE) hosts the ACFE Global Fraud Conference to bring to life these hardly believable (yet true) financial cases by way of those who […]
Accounting Fraud Watch: Samsung Bioepis, Celadon Group, More on BT Italy
Catching you up on the latest fraud happenings in the world of accounting. Two Samsung employees arrested over alleged cover-up [Financial Times] Two executives of Samsung’s biopharmaceutical unit were arrested earlier this week on suspicion of destroying evidence to cover up an alleged $3.9 billion accounting fraud. The Seoul Central District Prosecutors’ Office in South […]
Dorky Accountant Robbed His Employer to Buy Hookers and Blow Because Some Dude at the Office Made Fun of Him
Y’all ready to meet a real bad ass? You sure? I’m not sure you can take this. Darren Carvill, 38, is headed to jail after a “weekend of madness” which included hookers and blow funded by approximately £170,000 ($220,000 USD) he stole from his employer, a car servicing company. The Sun reports: A source revealed: […]
Accounting Fraud Watch: Jumio Founder, Former College Controller, Ex-Roadrunner Execs
We arrived late to a couple accounting fraud settlement parties thrown by the SEC recently. All the Lagunitas and buffalo chicken dip were gone, and we were stuck drinking Busch Light and munching on carrot sticks. But we’ll still recap what happened at these shindigs anyway. Silicon Valley startup Jumio’s ex-CEO settles SEC fraud charges […]
Ex-KPMG Partner’s Fraud Trial: Opening Arguments
A jury heard opening arguments in a Manhattan courtroom on Feb. 12 in the trial of a former high-ranking audit partner at KPMG who was charged with conspiracy and wire fraud for his role in a scheme to cheat the Public Company Accounting Oversight Board inspection process. David Middendorf and co-defendant Jeffrey Wada, a former […]
Ex-NBA Star Kevin Garnett Believes His Former Accountant Helped Wealth Manager Screw Him Out of $77 Million
During his illustrious 21-year NBA career, Kevin Garnett was a 15-time all-star, named the league’s MVP in 2004, and won a championship with the Boston Celtics in 2008. He also is the Minnesota Timberwolves’ all-time leader in steals. But Garnett doesn’t take too kindly to having $77 million stolen from him. That’s what he is […]
How Do We Fraudulently Boost Revenues for Thee? Let Me Count the Ways
If you’re going to get busted for using fraudulent accounting practices to artificially inflate your company’s revenues, you might as well make it worth your while—or at least worth the fine you’re going to have to pay to the Securities and Exchange Commission. The SEC levied fraudulent accounting charges against Tangoe, formerly a public telecommunications […]
Colonial Bank Collapse Will Cost PwC $625 Million, Reports Say
[Updated with statement from Bartlit Beck Herman Palenchar & Scott] Reports are hitting the interwebs this afternoon that a federal judge has ordered PwC to pay the Federal Deposit Insurance Corp. $625 million in damages for failing to uncover a long-running fraud scheme between its client Colonial Bank and the now-defunct mortgage lender Taylor, Bean & […]
Catching Your CPA Stealing From You Redhanded Must Be Oh So Satisfying
If you’re an accountant and you plan to steal from a client or your employer or whomever, one thing is certain: You are confident. Why else would you try to embezzle money unless you were sure you wouldn’t get caught? As noted criminal Sam Antar has said, “It’s a calculated risk. Everybody takes precaution against […]
Sarbanes-Oxley 15 Years Later: Accountants Need to Speak Up Now More Than Ever
This Sunday, July 30, 2017, marks the 15th anniversary of the enactment of the Sarbanes-Oxley Act (“SOX”) of 2002. SOX emerged after the “smartest guys in the room” caused Enron to implode, and WorldCom magically erased billions in earnings overnight. The scandals shook the public’s confidence in the reliability of financial reporting and led to […]
Tesco Bank Deals with Digital Heist
Cybersecurity experts and IT auditors better saddle up — the world just experienced its first successful digital bank robbery. The Tesco heist Last weekend cyber criminals executed a sophisticated attack on Tesco Bank (subsidiary of the British grocery chain) and successfully stole £2.5 million (~$3.1 million) from customer accounts. While the money was refunded quickly […]
IRS Scammers Coming Right at YOU, Tax Professionals
We've talked before about how unlikely it would be for an accountant to fall for the ol' "This is the IRS and you're about to be arrested unless you pay your overdue taxes" phone trick, but it seems that some enterprising up-and-comer at IRS Scams, Inc. realized that a few tax professionals would download a […]
Accountant Who Stole From Chicago Cubs, Cancer Patient Well On His Way to Making Enemies Out of Just About Everyone
There's probably nothing more agonizing in the world of sports than being a Chicago Cubs fan. Despite more than a century of disappointment, abuse and losing in every way imaginable, Cub fans remain loyal. I mean, what else are they gonna do? Right around the turn of the next century when they finally win another […]
White-Collar Crime Watch: An Online Dating Scam, A Fake CPA, and A Tax-Evading Stripper
My grandma got wrapped up in an illegal money-making scheme once. She started taping movies off TV, editing out the commercials, hand-labeling the VHS tapes, and selling them for $3 out of a cardboard box on her driveway. When I caught her, I quickly shut her new business venture down. Luckily, it's 2016 and none […]
FYI: IRS Doesn’t Accept Payments via iTunes Gift Cards
I guess TIGTA needed to put this out there: The Treasury Inspector General for Tax Administration issued an alert Friday warning that it has received information that callers impersonating IRS employees or the Treasury Department are demanding payments on iTunes Gift Cards. TIGTA noted that the scam callers may also request payment of taxes on […]
CPA Given Five Years to Think on ‘Thou Shalt Not Steal’
California CPA Donald Gridiron was sentenced to 57 months in prison for stealing more than $4 million from a New Jersey church and another nonprofit where he served as treasurer. Gridiron was also ordered to pay $5.1 in restitution. Apparently this all happened when some friendly bets on the golf course spiraled into something slightly […]
White-Collar Crime Watch: Polygamists, Fixed Tennis Matches, An Unfunny Accountant
Recently, Kraft Macaroni & Cheese claimed that it switched the ingredients in our beloved cheese packets to more natural, healthy options WITHOUT OUR NOTICE. As a woman of taste with a sensitive and discerning pallet who pretty much subsisted on a steady diet of mac and cheese through childhood and well into college, I definitely […]
White-Collar Crime Watch: a Whistleblower, a Hero Helicopter Pilot and a Dirty CPA Who Cleaned Money
This month in white-collar crime: Will you use your accounting skills for good or for evil? A new money-making scheme for all of usFun fact: in 1925, a scrap-metal dealer bought the Eiffel Tower from an Austro-Hungarian con-man named The Count. Instead of selling international landmarks to unsuspecting scrap dealers –- which I've considered and […]
White Collar Fraud Watch: a Dancing CFO, a Spanish Princess and a Vatican Accountant
An embezzling CFO, a tax-evading princess, and a money-laundering Vatican accountant walk into a bar. Oh, sorry, I meant a court room, to answer for their respective white collar crimes. This may sound like another GC witticism -– we think we’re hilarious over here -– but this time, I didn’t make anything up. As it turns out, these individuals are an actual bunch of white collar scofflaws. True story.
Accountant Worked One Day, Allegedly Embezzled $15k
Here's an impressive feat of (alleged) fraud: a woman worked at a company for one day and that was enough for her to embezzle almost $15,000. St. Louis County prosecutors say that Angela Phan stole the money from Triplematic Dispensers from July 1, 2014, and Dec. 6, 2015: Phan had worked for the company for […]
Florida Still Cranking Out Unsophisticated Tax Schemes
If you or someone you know is thinking about concocting a haphazard tax fraud, it may be tempting to go with a tried and true method that goes something like this: Step 1: Reside in Florida Step 2: Steal a bunch of taxpayer information Step 3: eFile a bunch of tax returns with this stolen […]
Accountant Won’t Be Taking a Walk in the Woods Anytime Soon
James Hammes, who spent 6 years on the lam walking the Appalachian Trail, pleaded guilty earlier today to wire fraud. The judge warned him that she could impose a maximum sentence of up to 20 years, although his plea deal should result in less time. Either way, it'll be more than enough time for him […]
Please Don’t Be Like This Accountant Who Got Scammed Over Email
Here's an unfortunate situation that hopefully none of you ever have to go through: The accountant for a U.S. company recently received an e-mail from her chief executive, who was on vacation out of the country, requesting a transfer of funds on a time-sensitive acquisition that required completion by the end of the day. The […]
Madoff Auditor Better at Cooperating Than Auditing, Won’t Serve Time
Auditors facing over 100 years in prison should take note: Madoff auditor David Friehling to get 2 yrs supervised release which includes 12 months home detention. So no prison time — Matthew Goldstein (@MattGoldstein26) May 28, 2015 Friehling given credit for cooperation which included days of testimony at long criminal trial last year. DOJ called […]
“Just Ask the Guy” Not Always a Futile Fraud Detection Method
Boonlomp Soonthornchai handled trustee, executor and accounting services as a partner at Yount, Hyde and Barbour in Middleburg, Virginia. In 2004, he began depositing client funds into his personal accounts, concealing the "the source of the money in his personal ledger." He then admitted to the embezzlement, "[w]hen confronted by firm board members and […]
Olympus Decides Fighting Lawsuits for Accounting Scandal Not a Pretty Picture
Olympus Corp, proud owner of a $1.7 billion accounting scandal, decided to say sayōnara to 11 billion yen ($92 million) to settle two civil lawsuits brought by investors. The company, who also settled litigation in the U.S. for $2.6 million in 2013, "had been defending against the claims, but decided that 'swiftly resolving this matter through […]
Man Who Lived Out Fantasy of Screwing Over a Major Airline Sentenced to Six Years in Prison
Paul Anderson, a former Delta Airlines employee, defrauded Northwest and Delta Airlines out of $36 million. In a just world, we would proclaim him a hero who sees the injustice of horrendous business practices and does right by all of us who have been fucked over by an airline. Alas, we live in nation of […]
Ex-Crazy Eddie CFO Now Judging Fellow Criminals on Their Criminal Talents or Lack Thereof
If there's anyone who knows about being a criminal, it's former Crazy Eddie CFO Sam Antar because he is one. Perhaps that's why CNBC recruited him to judge fellow criminals' performance much like Michelle Visage judging drag queens on their cakes and tucks (don't Google that). First, the background on the scam up for judging: […]
Disgraced CEO Claims Stealing $665 Million Was Just Incompetence, Not Theft
You wonder sometimes why these guys say anything at all instead of just keeping their traps shut: A former investment CEO was sentenced Friday to 14 years in prison and ordered to pay $665 million in funds lost to his former clients. “I may be incompetent, but I’m not a thief,” Eric Bloom, 50, said […]
Let’s Not Rush to Judgment Just Because a Guy Blew Off a Meeting About Accounting Discrepancies 5 Minutes Before It Started
A man who spent his entire 32-year-career in the accounting department of Frisch's Restaurants — purveyors of the iconic Big Boy — has been accused of stealing $3.3 million from the company, which he may or may not have blown at the casino. In a statement filed with the SEC, the company assured shareholders that […]
Satyam Founder Sentenced to 6 Months in Prison for Massive, Obvious Fraud
Remember Satyam? That Satyam? Yeah, it's been awhile for us, too. Satyam's PwC India auditors already received a lifetime ban, but what about Satyam's founder? Surely you've been wondering what sort of slap on the wrist he'd get for one of the largest and most blatant frauds in history? Wonder no longer: A local court […]
Ex-Enron CFO Sorry About Sarbanes-Oxley, Guys
Enron's former CFO was at the University of New Mexico last week speaking about, well, fraud and stuff because that's pretty much the only thing you can do when you're a well-known convicted felon who played a part in bringing down your former company and a prestigious accounting firm. Water under the bridge and all […]
Old Lady Convicted of $190,000 Fraud and Doesn’t Even Have to Miss Christmas
The ACFE says 7 percent of frauds are detected by accident and only 3 percent are discovered by the external auditor, proving that fraudsters are 4 percentage points dumber than auditors are smart. That’s pretty much what happened with poor, dumb Alice Riley, the 61-year-old former clerk for the City of Auburn, Kansas, who was […]
The Stupid But Wealthy Athlete’s Guide to Not Getting Ripped Off
Wealthy athletes are easy to scam. Really easy. Not all athletes know how to handle a fortune. Wealthy athletes are good at playing sports, not managing their millions. We financial types who know how to do sexy stuff like add (er, ten key and use spreadsheets) have a duty to protect the investor –- even […]
Defunct Crazy Eddie Won’t Let Fraud Get in the Way of Continued Excellence
As far as bullshit recognitions go, this one has to be up there. Former Crazy Eddie CFO, reprehensible villain and (full disclosure:) friend of GC Sam Antar tipped us off to an email he received on behalf of Mitchell Antar — brother of criminal mastermind Eddie Antar — who did prison time for his part […]
PwC Is Raking It In on Old Fraud
As the multibillion-dollar scheme led by Tom Petters approaches its sixth anniversary, the meter is still running for the lawyers and accountants sorting through the corporate empire created by the former Wayzata businessman, and the array of creditors and investors who did business with him. More than $83 million has been paid to the lawyers […]
Scott London Talks About Relationships, Rolex Watches and How He Hates that Parking Lot Picture
ICYMI, MarketWatch interviewed Scott London the other day — which I suppose was a good idea since interviews might get a bit more difficult after London heads off to prison to serve his 14 month sentence next month. In the interview, London comes off as approachably remourseful, almost like a grandma apologizing to her heirs […]
Bernie Madoff’s Former Accountant Pleads Guilty But Clueless
Paul Konigsberg is going with the guilty but ignorant and terrible at accounting defense: A longtime former accountant to Bernard Madoff pleaded guilty Tuesday to falsifying records and other charges in connection with the convicted financier's Ponzi scheme. "I'm here today to take responsibility for what I did that was wrong," Paul Konigsberg, a former […]
Listen to a Fake IRS Agent Try Telling Ex-Crazy Eddie CFO He’s About to Be Arrested
Perhaps you have heard of some very ambitious (and stupid) scammers posing as IRS agents who have been relentlessly threatening honest Americans with jail if they don't pay up immediately. Today, those scammers called the wrong former CPA. Considering the fact that Sam Antar didn't do any time for the Crazy Eddie fraud, you can […]
Not Auditing Is Twice as Effective as Auditing at Catching Fraud
Today, we have an interesting ACFE report that not looking for fraud is more than twice as effective as external audits at detecting internal fraud. From CFO.com: In the recent past, the Association of Certified Fraud Examiners has described where companies should concentrate their monitoring for employee fraud. In finance departments, for example, a majority […]
Ex-KPMG Partner Who Gave Insider Tips to His Former Golf Buddy Is Going to Talk About Ethics Before He Goes to Prison
For the low low price of $158, you can sit in on a live video interview with fallen star Scott London, who will be giving insight into the importance of ethics before he heads to prison due to his the ethical deficiency that led him to profit off insider tips he gave to his golf […]
Qualcomm Managers Accused of Insider Trading by SEC Didn’t Even Try to Hide It
When you think insider trading, you think throwaway pre-paid phones, scribbles on napkins, and clandestine meetings under the dark of night. For three Qualcomm sales managers accused yesterday by the SEC, all that was way too much work. From the SEC's press release: The SEC alleges that Derek Cohen, Robert Herman, and Michael Fleischli learned […]
If You’re Engaging in Insider Trading, You Probably Shouldn’t Connect With Your Insider On LinkedIn
Two guys in Australia have been arrested for insider trading, money laundering, corruption and abuse of public office. Australian Federal Police allege the offenses went down between August 2013 and May 2013 to the tune of $7 million AU (about $6.5 million US). How did they get caught? Funny you should ask. An astute foreign […]
CFO Felon Not Sure Why AICPA Didn’t Pick Up the Phone to Talk About His Fraud
Last week, ex Crazy Eddie CFO, notorious convicted felon and known Twitter troll Sam Antar tipped us off to a questionable AICPA webcast called "Voices of Fraud," which ended up on his radar likely because he has a robust Google Alert for his own name. Here's what he told us: The AICPA is offering a […]
Now That He’s Sentenced, Scott London Plans For the Future
This is worth pulling out of the archive. In an exclusive interview last year, London tells CNBC he received $50,000 in cash, a watch worth $10,000, and $10,000 in "gifts" for his wife by giving tips only an insider would have to his pal Brian Shaw. As we all know by now, Scotty walked away […]
If a Movie About Fraud Was Funded With Fraud, That Would Be Dumb (and Dumber)
The source of the $100 million used to finance Oscar-nominated The Wolf of Wall Street is being openly questioned in a Los Angeles courtroom. Brad Krevoy and Steve Stabler, producers of the 1994 hit Dumb and Dumber, are suing Red Granite and its principals, Riza Aziz and Joey McFarland, for being excluded from a sequel. […]
Man Sentenced For Fraud While Waiting To Serve First Sentence for Fraud
We all know zebras can't change their stripes, and former Crazy Eddie CFO Sam Antar has taught us not to believe criminals when they claim they are sorry and repentant. One Peter In Cho, the former head of a Chicago securities brokerage, was so repentant after he was sentenced to 5 1/2 years in prison […]
If It Sounds Too Good to be True, It’s Probably a Pyramid Scheme
The SEC busted yet another alleged pyramid scheme, and this one implicated the cloud in their malfeasance: The SEC alleges that three entities collectively operating under the business names WCM and WCM777 are posing as multi-level marketing companies in the business of selling third-party cloud computing services, which can include website hosting, data storage, and […]
Man With Deep Pockets Busted Stealing a Lot of Laundry Money
Just how many loads of laundry could one do with $460,000 in stolen quarters? That's probably not the question asked by public works inspector Thomas Rica, who pleaded guilty this week to stealing that much in quarters from the meter collection room of the New Jersey town for which he worked. “We’re dealing with the […]
Dewey Even Want to Know How Much Trouble the Ex-Heads of This Failed Law Firm Are In?
This is bad. Very very bad. Let's hop in the time machine and go back to 2012, when Colin caught us up on just how bad the situation was over at Dewey (spoiler alert: tax partners were jumping ship and heading to KPMG): You might not be aware of this, but mega law firm Dewey […]
Here’s a Textbook Case of Dumb People Engaging in Illicit Sexting Spiraling into Extortion, Embezzlement
Where exactly does "sexting extortion" fall on the fraud triangle, anyway? In today's sordid tale of embezzlement gone wrong, we present Shelly Lough of West Virginia. Shelly worked as a Bethany College cashier before a single misdirected text turned her whole life upside down. Usually, the recipient of a text not intended for their number […]
Scott London’s Updated LinkedIn Profile Is the Greatest Thing Ever
As pointed out by Attestation Update, looks like Scott London is hoping to put all this insider trading drama behind him and start fresh. He brings to the table years of experience and just a few bad choices. If nothing else, you have to give the guy credit for giving exactly zero fucks instead of […]
Protip For CPAs: Don’t Embezzle From Your Employer to Pay For Your License Renewal
There is always "that guy" who has to ruin it for everyone. So if next time you go to renew your CPA license, the state board asks you "did you steal from your employer to pay for this license renewal?" you know why: An accountant and finance manager for a local tool and die company […]
Madoff Accountant’s 5-Year-Old Kid Was Not a Very Good Investor, Therefore He Invested in Madoff
Bernie Madoff's "outside auditor" (popularly known as his "accountant") David Friehling already pleaded guilty to fraud in 2009, at which time he told judge U.S. District Judge Alvin Hellerstein "I am truly sorry for the suffering of all the victims." It turns out among the victims is Friehling's own son, who was five years old […]
Ex-Madoff Accountant Got an Early Start on ‘Clearing His Good Name’
When you're known as "the guy Bernie told us could help with our tax returns," it means getting the ball rolling before the crack of dawn: At 6 a.m. on Thursday, agents of the Federal Bureau of Investigation met Mr. Konigsberg at his lawyers’ offices in Midtown Manhattan and arrested him. He is expected to […]
CliftonLarsonAllen Settles with Dixon for $36 Million Over Crundwell Fraud
In addition to CLA coughing up their share, Fifth Third Bank will pay $3 million, and the city's auditor Sam Card will pay $1 million for a nice round sum of $40 million total, according to Saukvalley.com. CLA provided us with a statement from CEO Gordon Viere: The allegations of fraud committed by City of Dixon Comptroller […]
Footnotes: ‘This Tweet does not constitute an offer of any securities for sale.’; IRS Nominee Gonna Get Grilled; The End of Estate Tax Planning? | 09.12.13
Siegfried Group is looking for Client Service Directors in Washington, DC, Chicago, and San Francisco. [GCJ] We’ve confidentially submitted an S-1 to the SEC for a planned IPO. This Tweet does not constitute an offer of any securities for sale. — Twitter (@twitter) September 12, 2013 Hatch: IRS nominee has 'great many questions' to answer [The […]
Crooked CFO Amused By Pearl-Clutching Tweet
RT @footnoted "Seriously flouting established SEC rules makes a mockery of the system!" — Sam E. Antar (@SamAntar) August 30, 2013
Ex-Chicago Comptroller Was Soooo Chicago Before Getting to Chicago
Amer Ahmad resigned as Chicago's comptroller about three weeks ago, but yesterday is when we found out just how qualified he really was for his job: On Thursday, Ahmad was indicted in Ohio on federal corruption charges in what prosecutors described as a more than $500,000 kickback scheme involving state investment business while he […]
Detecting and Preventing Sex Fraud Isn’t All That Different From Detecting and Preventing Financial Fraud
Today’s Corporate Fraud Is Making Andrew Fastow Uncomfortable
“In my opinion, the problem today is 10 times worse than it was when Enron had its implosion in what was called the era of corporate fraud,” said Fastow. “The things that Enron did, and that I did, are being done today. In many cases, they’re being done in such a manner that makes me […]
Lapping Schemes Are For Stupid People and Dogs with Access to Lidless Toilets
Any licensed CPA caught perpetrating a lapping scheme should have his or her license revoked immediately and permanently — not for committing an act discreditable to the profession, but for being a giant dumbass. There so many types of fraud that are way easier than lapping. No. Wait. Every type of fraud is way easier […]
Jeff Skilling Is Halfway Home
Skillz, who has been in prison since 2006, had his 24-year sentence reduced today by 10 years by virtue of a "court-ordered reduction and a separate agreement with prosecutors." This has been an ongoing battle ever since JS appealed his sentence and it was vacated in 2009 because "a sentencing guideline was improperly applied." Persistence pays off! […]
Going Concern Contributor Is a Suspect in a $60 Fraud Case
Ed. note: We welcome back Greg Kyte after a brief post-April 15th vacation. He'll join us every month in his Accumulated Deprecation column. Go here to read more of Greg's posts. Somebody stole $60 out of my desk drawer at work. Not my money. My company's money. You know, the stuff that, as an […]
Jeff Skilling’s Attorney Calls Attention to His Client’s Extra Effort
The good news for ex-Enron CEO Jeff Skilling is that he'll be released from prison almost 10 years earlier than his original sentence of 24 years. The bad news is that the release date is still four years away and while his attorney appreciates the closure, he feels there's still some injustice: "The proposed agreement brings certainty and […]
Get Ready to Put Jeff Skilling Back on Your Christmas Card List
Maybe not Christmas 2013, but some Christmas in the not so distant future: Former Enron CEO Jeffrey Skilling, who is serving a 24-year prison term for his role in the energy giant's epic collapse, could get out of prison early under an agreement being discussed by his attorneys and the Justice Department, CNBC has learned. Skilling, who was […]
Woman Misunderstood ‘Crazy Accounting’ to Mean ‘Take Money That Doesn’t Belong to You’
Leslie Lebel used to work in the finance department for the City of Bloomington, Illinois. After seven years on the job, during the time between September and December 2011, she allegedly embezzled $21,000 or so. She was arrested last week this allegedly sticky fingering and prosecutors shared the details in court this week: Lebel accessed […]
Accountant on Probation for Embezzlement Still More Employable Than the Average Non-Accountant (Temporarily)
Generally speaking, accountants are in demand. So much so, perhaps, that prospective employers might overlook small details when hiring one, such as that accountant still being on probation for stealing from a former employer. That's exactly (allegedly) what happened with 39-year-old Michelle Hice. You see, Michelle was fired from a third-party accounting firm in October […]
Bad Spelling Can Derail an Otherwise Promising Career in Fraud
For God's sake, get a good education.
Burn of the Day: NJ Embezzler Pleads Guilty To Not Paying Taxes on Money She Stole
Ouch! According to the DoJ, a former employee of Atlantic County Concrete and Material Co. admitted yesterday evading federal income taxes on nearly $700,000 she received in 2008. Nancy Armienti, 59, of Elmer, N.J., pleaded guilty in U.S. District Court to one count of tax evasion. According to documents filed in this case and statements […]
It Looks Like Clifton Gunderson Knew About Rita Crundwell’s Secret Bank Account
Everyone remember Rita Crundwell? She's the horse lady that gave Dixon, Illinois a long face when it was discovered that she had been helping herself to the city's money. About $53 million or so over a couple of decades. That's not Madoff, Stanford, or Petters money, but it's not exactly a small sum. Last summer Dixon […]
Ernst & Young Study Finds That Fraudsters Aren’t So Creative with Code Words Over Email
If you and some cohorts are fed up with walking the straight and narrow, be advised that a recent study by Ernst & Young discovered something that may help assist you in making your future fraudulent endeavor a wild success: Phrases such as “nobody will find out”, “cover up” and “off the books” are […]
Study: Competing Forensic Accounting Bodies Pretty Much Hate Each Other; Regulation Needed
The continued prevalence of fraudulent activity in business will undoubtedly lead many of you to a career in forensic accounting and/or fraud examination. Because of the nature of their work, you might be under the impression that the organizations in this little corner of the sandbox would be above reproach and bickering over petty differences […]
Let’s Discuss: Auditors and The Responsibility to Detect Fraud
When I finally got around to writing about the HP/Autonomy finger pointing party yesterday, the topic of fraud detection by auditors came up as it often does in these scenarios. More specifically, the statement that "audits are NOT designed to detect fraud." A friend of Going Concern emailed me later in the day with […]
Stop What You’re Doing and Get One of These 2013 Corporate Scandal Calendars at Once
As dutiful capital market servants, it is crucial that you know all the important dates in the history of your craft. The day Andersen died. The first day the computerized CPA exam was offered. The moment you knew that your joke of a college band was going nowhere and that a degree in accounting was […]
Rita Crundwell to Appear in Federal Court Tomorrow with a Long Face
With the ponies, RV, and Thunderbird all gone, the ex-Dixon, Illinois comptroller must have figured that the jig was up: Former Dixon comptroller Rita Crundwell plans to plead guilty Wednesday to a federal fraud charge that alleges she siphoned more than $53 million from the small northwestern Illinois city’s coffers, according to the U.S. Attorney's […]
According To This Paper, It Takes Cojones To Commit Fraud
No, really, that's actually what the paper says. The abstract: What factors explain the behaviors of corporate leaders who engage in spectacular frauds? Is it greed? Is it power? Are these leaders, as some critics allege, simply psychopaths? Or is something else going on? In this Essay created for a symposium on the “agency problem,” […]