Monday Morning Accounting News Brief: AI Boom Investor Fraud Off to a Strong Start; Do We Even Need Tax Pros? | 4.20.26

Posted on by Adrienne Gonzalez
fluffy white dog with squinty eyes on a bed

4/20 you say? Nice.

In this news brief

We Shouldn’t Need Accountants

Let’s get things started with a little piece Annie Lowrey wrote for The Atlantic: We Shouldn’t Need Accountants. Annie, I bet many accountants would agree with you. No, I know for a fact many would.

Her premise, and you should have gotten this simply from the fact that the article was published on April 15th, is that there’s really no good reason for the majority of the tax prep industry to exist. Not the high level stuff, pros are still best at that. But much of the tax season song and dance could just be done away with, she argues.

If you are anything like me, you have spent a lot of time over the past few weeks opening letters, finding receipts, requesting PDFs, scanning documents, and going through your credit-card statements line by line. It’s tax season. And in the United States, taxes are a DIY affair.

This is the case even though Washington could probably do your taxes for you. If you earn a salary or an hourly wage, the Internal Revenue Service already knows how much money you make. It likely knows how much you owe or how big your refund should be too. Nine in 10 households take the standard deduction, making their liability easy to glean from payroll and banking data.

Yet Uncle Sam demands that Americans fire up TurboTax, head to a storefront preparer, hire an accountant, or sit down with a sharp pencil and a strong cup of coffee to get their taxes done each spring. The average filer spends 13 hours on their 1040—a time tax that many of our wealthy peer countries have reduced to a couple of minutes, if that. Prepopulated documents and return-free systems are common everywhere but here. Sweden lets residents file by text. Canada prefills paperwork. Japan sends households a document summarizing their tax contributions. If everything looks copacetic, many workers get to do a blissful nothing. Denmark, Estonia, Spain, and Norway have similarly simple processes.

r/taxpros mostly agrees with her, with of course a few corrections like “The last thing anyone should do is fire up TurboTax. Freetaxusa is at least as easy to use, at a much lower cost.”

And there’s this take:

These articles always miss the key reason why US taxes are so complex. The US federal government uses the tax code to incentivize things it deems productive society as a whole. It’s actually a very clever way to make small tweaks towards the greater good without enacting draconian laws, and it has the added benefit (from legislators’ perspective) of being less noticeable to citizens. The downside is, of course, that our tax code gets bogged down and overly complex.

FASB Tackles Gamers’ Most-Hated Topic: Data Centers

FASB is working on a couple things relevant to this decade so that’s nice to see. CFO Brew:

The Financial Accounting Standards Board is taking a closer look at two issues that’ve been in the headlines a lot recently: data centers and private credit. (And who says accounting is just for the nerds?)

FASB, the body charged with setting GAAP standards, announced on April 6 that its chair, Rich Jones, added a research project “to monitor current trends and emerging issues and solicit stakeholder feedback” on topics including “data infrastructure investments and non-traditional lending.” In English: FASB is monitoring accounting issues around data center projects and private credit.

You Just Gonna Let AI Agents Run Wild Like That?

Deloitte predicts half of business decisions will be automated by AI agents by next year. Business Chief writes about the firm’s 2026 Global Human Capital Trends report:

Two-thirds (66%) of leaders recognise the need to intentionally design human–AI interactions, yet only 6% say they are making meaningful progress.

The result is an “accountability gap”: 60% of executives already rely on AI for decision-making, but just 5% report that those decisions are effectively governed.

“Trust in data or information comes from knowing that it’s authentic – unaltered and originating from a verified source,” the report notes. “But AI-generated content challenges authenticity, often making it difficult to distinguish between genuine human talent and sophisticated fabrications.”

Yeaaaaah idk about that. Related: Thousands of CEOs admit AI had no impact on employment or productivity—and it has economists resurrecting a paradox from 40 years ago

Ilhan Omar’s Husband’s Accountant Struggles With Liabilities, She Says

Here’s something from WSJ: Ilhan Omar Says She Isn’t a Multimillionaire, Blames Accounting Error

Democratic Rep. Ilhan Omar of Minnesota, facing potential investigations pushed by President Trump and House Republicans, said she isn’t as wealthy as documents she previously submitted to Congress suggest because there were major accounting errors in her filing.

An Omar disclosure filed last year showed she and her husband held assets of between $6 million and $30 million, a massive rise in wealth from her previous annual filing. That jump triggered questions among Republicans eager to scrutinize a critic of the president.

An amended filing viewed by The Wall Street Journal shows the couple’s assets to be just $18,004 to $95,000. The forms don’t require exact values, only broad ranges.

The value of the businesses in her disclosures plummets when liabilities are factored in and Omar originally assumed the accountant had already done that, said WSJ.

I’ve Always Hated That Word, Like “Moist”

“Disgorgement” is getting some discussion at the Supreme Court this week, reports Bloomberg Tax:

Three times over the past decade, the US Supreme Court has cut the Securities and Exchange Commission’s ability to extract millions of dollars from alleged wrongdoers.

Critics of the commission say it’s not enough. In arguments Monday they are asking the justices to put new limits on “disgorgement,” one of the SEC’s most potent enforcement tools, designed to recoup illicit profits and return them to victims.

The dispute will shape a panoply of SEC cases in which victims aren’t easy to pinpoint, from low-profile record-keeping violations to major insider trading allegations. The SEC used disgorgement to secure orders for more than $6 billion in fiscal 2024 and almost $11 billion last year.

CPA Said F That to Reporting Client Income

A 72-year-old accountant from Connecticut was busted for not properly reporting income generated from his accounting business. CT Insider:

An accountant from Middlebury with a business in Naugatuck was sentenced to time in prison for avoiding paying hundreds of thousands of dollars in taxes, an official says.

U.S. Attorney for the District of Connecticut David Sullivan said Sodlosky, a self-employed certified public accountant, owned and operated Edward J. Sodlosky, Certified Public Accountant in Naugatuck. He said Sodlosky prepared and filed annual joint income tax returns with the IRS on behalf of himself and his spouse from 2016 through 2022.

Sodlosky also filed annual partnership income tax returns for an entity named FinGLTD, which he owned with his spouse, Sullivan said. During those seven years, he said, Sodlosky cashed more than 2,000 client payment checks to hide income generated by his accounting business.

AI Company Was a Fraud? You Don’t Say!

A little fraud story from the DoJ: Former Chief Executive Officer and Chief Financial Officer of Nasdaq-Listed Company Charged With Operating a Continuing Financial Crimes Enterprise in Multi-Year Scheme to Defraud Investors and Lenders.

Earlier today in federal court in Brooklyn, a ten-count indictment was unsealed charging Puthugramam “Harish” Chidambaran, the founder and former Chief Executive Officer of iLearningEngines, Inc. (iLearning), and Sayyed Farhan Ali “Farhan” Naqvi, iLearning’s former Chief Financial Officer, with running a continuing financial crimes enterprise, conspiracy to commit securities fraud, securities fraud, conspiracy to commit wire fraud, and wire fraud. The charges arise from the defendants’ years-long scheme to defraud retail and institutional investors in iLearning, a technology company that claimed to provide artificial intelligence (AI)-driven business automation solutions, and to obtain financing for iLearning through materially false and misleading statements about the company’s financial performance.

“As alleged, the defendants exploited investor excitement over the AI boom and presented a rosy financial outlook to investors and lenders that was built on lies. While the defendants pitched iLearning as a way to revolutionize training and education through AI, the truly artificial part of the defendants’ story was iLearning’s customers and revenues,” stated United States Attorney Nocella. “Our Office is committed to protecting investors and holding accountable corporate executives who undermine the integrity of our financial markets for personal gain.”

Get ready for a lot more headlines just like that one in coming years. A LOT.

OK let’s call this news brief done. If you have a comment on anything here, or a tip for us, reach out via email or text anytime. Find us on the former bird app @going_concern. Have a great week, you.

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Accounting News Roundup: Holiday Edition | 12.24.10

~ Happy Holidays! Here’s some reading to keep you occupied this weekend whether you’re celebrating someone’s birthday, enjoying Chinese food or doing nothing at all.

IRS says tax changes will cause some filing delays [AP]
The Internal Revenue Service says some taxpayers will have to wait until mid- to lat- February to file their returns dulaw approved by Congress in its lame-duck session. The changes apply to tax breaks on college tuition, state and local property taxes and out-of-pocket expenses for teachers. The IRS said Thursday the delays would be minimal for people who itemize deductions, because they normally must wait for financial documents before filing their returns.

Accountants, Texas board still at odds over Enron [Bloomberg]
To many in the accounting world, Carl Bass is a hero. Long before Enron became a worldwide symbol of scandal, Bass told his supervisors at Arthur Andersen LLP that something was amiss with the Houston energy giant. But the Texas state board that licenses accountants sees Bass differently — as unfit to continue in his profession. Nearly a decade after Enron collapsed and took Arthur Andersen with it, the work of Bass and another former Andersen partner, Thomas Bauer, as Enron auditors is still being debated in a highly contentious and costly proceeding.

Can You Break the Law by Complying With It? [DealBook]
The state claims Lehman’s auditors aided in a fraud, using Repo 105 transactions to make the books look healthier than they actually were. Ernst & Young proclaimed it did nothing wrong because its work complied with Generally Accepted Accounting Principles, or GAAP. Both may well be right — although that won’t necessarily preclude a claim against Ernst & Young.

TLP: No Animals Were Harmed … [JDA]
Reindeer like boomies!

The 12 gadgets of Christmas: Top tech toys of 2010 [Business Zone]
There’s still time.

Accountant Accused of Swindling Actress [WSJ]
A New York City man who did accounting work for entertainers was accused of swindling a “Law & Order” actress out of more than $1 million Thursday. The man, 50-year-old Joseph Cilibrasi of Manhattan, pleaded not guilty in Manhattan Supreme Court, where nine charges were levied against him and his company, Cilibrasi & Associates. Mr. Cilibrasi, who faces up to 25 years in prison on the top charge, was held on $100,000 bond or cash.

Blame game: Accountant denies claims in Koss case [TBJGM]
Julie Mulvaney, Sujata Sachdeva’s alleged accomplice at Koss Corp., claims she did nothing wrong and simply followed orders from Sachdeva, who Mulvaney described as a “powerful, insistent, imperious, overbearing superior.”

Deloitte plans to move offices to Midtown [NYP]
Deloitte has decided to consolidate its offices in Midtown, putting the kibosh on a long expected downtown deal for the accounting giant to move from 2 World Financial Center into 400,000 square feet at 4 World Financial Center owned by Brookfield Properties. Instead, Deloitte, which was also going to lease an additional 100,000 square feet at 30 Rockefeller Center in Midtown, may consolidate in that tower and lease even more space — if it can find the elbow room, The Post has learned.


Best of 2010: Accounting [CFO]
In the realm of accounting, no one moved more rapidly this year than the Financial Accounting Standards Board and the International Accounting Standards Board. The two standard-setting bodies set forth an aggressive agenda that called for a dozen or so new rules to be issued by 2011.

Congress Resolves Many Tax Issues During Lame-Duck Session [JofA]
Congress adjourned its year-end lame-duck session on Wednesday after passing legislative fixes for several pending tax issues, including the estate tax, the expiration of the 2001 and 2003 tax cuts, an alternative minimum tax (AMT) patch, and extensions of many expired provisions. However, it failed to repeal the expanded Form 1099 reporting requirements that were enacted as part of this spring’s health care reform legislation. The tax changes made during the lame-duck session were enacted as part of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (Tax Relief Act of 2010, PL 111-312), which Congress passed on Dec. 16, and President Barack Obama signed into law the next day.

(UPDATE) Accounting News Roundup: Rangel Says He’s Not Quitting as Ways & Means Chair; IRS Is Sitting on $1.3 Billion in Unclaimed Refunds; SEC Adding Muscle in New York | 03.03.10

• Rangel Loses Support in House [WSJ]
You can ignore what’s written below, except the part about rent-controlled apartments.

Charlie Rangel will not be quitting (temporarily sayeth Charlie Rangel) as the Chairman of the House Ways & Means Committee. If you (read: Republicans) want him out, you’ll have to vote him out. Bad news for Chuck is that the Republicans in the House and several of his fellow Democrats are poised to do just that, “As many as 30 House Democrats could join 178 House Republicans in voting to oust Mr. Rangel as head of the Ways and Means Committee…a substantially higher number than in previous votes on his removal.”

Never mess with people when it comes to rent-controlled apartments. They’ll turn on you like Judas.

In the meeting, Mr. Rangel refused to quit as chairman of the Ways and Means Committee and instead said he’d think overnight about the matter before deciding whether to step down or face an uncertain vote.

After the one-hour meeting broke, Mr. Rangel told reporters he would stay on.

“You bet your life,” he said. Pressed further, Mr. Rangel, raising his voice, said emphatically: “Yes, and I don’t lie to the press.”

There you have it. You want Rangs out? It’ll be over his dead body. Since he’s 79, it might just come to that.

• Taxpayers Have $1.3 Billion in Unclaimed Refunds [TaxProf Blog]
That’s just for 2006. California leads the charge with over $150 million, followed by Texas with $114 million, and Florida with $110 million. 1.4 million tax-hating Americans have until April 15th of this year to claim and then the money goes straight to Goldman Sachs.

• SEC to beef up its NYC office in 2010 [Reuters]
Here’s a possible gig for those of you that are still looking for work. The not-so-new but constantly improving (?!?) SEC is looking to hire a few good men and women for its New York office. Having got the scratch to put a few more hands on deck, the Commission is looking for 18 people for its enforcement team and 15 for its examination staff. There’s no indication that this will solve the SEC’s “idiots” problem but maybe you can at least land a job.