The Impact of Fraud and Abuse Can Far Exceed the Value of Stolen Money—Civil Penalties Are Often Exorbitant Clients often look to their attorneys as trusted advisors on the issue of prevention of corporate fraud, waste, and abuse. In this article, Joe Epps identifies the impact occupational fraud and abuse has on a company; present governmental oversight issues associated with fraud and abuse; and several c ...

Net Cash Flow is Often the Most Significant Single Factor in a Financial Condition Analysis A financial expert in an arson case answers four questions: What changes occurred in financial condition prior to the date of the fire? What was the financial condition at the date of the fire? What was the future financial picture if there had not been a fire? Was there a potential financial benefit from the fire?  ...

A Solid Checklist to Help Businesses Deal with the Immediate Hours after Discovery of Fraud The discovery of fraud within a company can be extremely unnerving and can introduce a certain amount of panic in business owners and accounting professionals. Here’s a checklist of things you should be sure to do—from contacting law enforcement and insurers to preserving evidence and communicating with employees. ...

The FBI Says it Busted an 18-Person Ring that Spanned 8 Countries and 28 States.  Make Up. Pump Up. Run Up. Daniel Gross at The Daily Beast explains:  It’s not the latest exercise fad. Rather, according to the Justice Department and the Federal Bureau of Investigation, it’s the three-step process through which an 18-person ring allegedly committed a stunning $200 million credit-card fraud.   Here're the bas ...

Discovery should focus on the technologies storing data Karl Epps explains how technology has changed in the last year, and what impact those changes have had on current and future standards for digital evidence. ...

First, Define a Computer Use Policy for Your Firm How can you best protect against IP theft—or simple misuse—by employees? Karl Epps explains that a solid first step is defining a computer use policy establishing approved policies and protocols for removable media, offsite storage, remote access, and laptops. Here’s an overview of common problem areas and software and policies that can help best address the ...

Different Standards of Value Apply to Different Sort of Intellectual Property Valuations. Here’s Why it Matters—and How to Figure Which Standards Apply. Robert Reilly explains how different sorts of intellectual property (patents, trademarks, copyrights, and trade secret) valuations have different objectives depending on their varying purposed. It’s critical to understand those objectives in order to define ...

Whether you are engaged in a business valuation or a forensic investigation, do you know exactly what to do if you suspect that an employee of the subject company is committing theft? Darrell Dorrell and Gregory Gadawski provide company owners, CFOs, valuators, and forensic accountants with a check list of how to proceed in fraud investigations. The key procedural ingredient is caution. Here’s why. ...

Learn How the Pros Take Down an Embezzlement Scheme and Gather Tips on How to Best Defend Your Own Practice. Mark S. Warshavsky reviews Stephen Pedneault’s Anatomy of A Fraud Investigation. The book combines a step-by-step recounting of best practices with real-life drama as investigators discover, investigate, and resolve a fraud incident—a fantastic guide to how to defend against and uncover fraud. ...

Few Companies with Under 100 Employees Have Fraud Controls in Place Small businesses are significantly more likely than their larger counterparts to neglect instituting basic antifraud controls that could save them from costly losses, a recent worldwide survey shows. The Journal of Accountancy reports in the August issue:  ...

Fraud's History is Impressive: From Over-the-Counter Cure-Alls to Florida Real Estate and Musical Talent Fraud The Association of Certified Fraud Examiners has built up a choice collection of fraud souvenirs under founder and chairman Dr. Joseph T. Wells. Visit the Accounting Today site to see  some of the most notable pieces, which include Bernie Madoff’s cigar box, an Enron stock certificate, a Nigerian F ...

How Much Do You Know about Protecting Personal and Corporate Information from Would-be Fraudsters? Find out what you know about how to analyze credit, what causes data breaches, what precautions to take when accessing hotspots in an airport with a laptop, current identity theft laws, and controlling physical access to restricted areas. ...

Tracy L. Coenan published a succinct guide to fraud analysis last year in the Wisconsin Law Journal that's very much worth reading.  Excerpt: ...

Corporate investigation may lack the glamour of Bond and Bourne, but the two worlds aren't so far removed.  Former Kroll analyst Chris Morgan Jones tells The Independent's Tim Walker why.  Due diligence and forensic accounting don't set the pulse racing like, say, the trailer for the latest 007 movie, so it's quite a feat for Morgan Jones to have conceived a thriller about business intelligence that is genu ...

"With New Firepower, S.E.C. Tracks Bigger Game,"  Ben Protess and Azam Ahmed  report at the New York Times Dealbook. Embarrassed after missing the warning signs of the financial crisis and the Ponzi scheme of Bernard L. Madoff, the agency’s enforcement division has adopted several new — if somewhat unconventional — strategies to restore its credibility. The S.E.C. is taking its cue from criminal authorities ...

This piece really has no new information in it, so if you're looking for that, you can stop reading here. Instead, it's for Anglophiles.  Observers of British culture.   The BBC recently posted rather prominently a piece pondering the tragedy of the human condition wistfully, as it so often does.   Well, that's not quite what the article was about.  Actually, it's rather hard to tell what the article is abo ...

Psychology Of Fraud: Why Good People Do Bad Things NPR's Chana Joffe-Walt and Alix Spiegel have put together a fascinating podcast that examines the psychology of fraud. It often isn’t as easily explained as bad people doing bad things. Ethicists and psychologists have documented an unusually high number of people who start out, in their minds, doing the right thing. The story follows the case of Toby Grove ...

Corporate Investigations Increasingly Aided with Digital Forensics Digital investigators can do more than retrieve data from devices. They can also use data to reconstruct past events to explain how computers were used to perpetrate wrongdoing.  Info4Security has introduced a new column, the Forensic Technologist, which will be written by Ernst & Young’s Simon Placks and explore how computer forensics a ...

Fraud and the Family Business: It’s Not So Unusual The dynamics of a family-owned business are like no other, writes Robert Rothbort at Accounting Today.   There's usually a great atmosphere of trust. But that can leave family businesses uniquely vulnerable to fraud.  Here are some common schemes: • “Ghost” employees. The family member overseeing payroll creates “ghost” employees that do not exist and arran ...

IT Guru Turns Out to Be Security Hole  Roger Kay reports at Forbes:  Small businesses have become a choice target for hackers, but by far the most common — and devastating — attacks on small businesses are inside jobs. This is the story of one such assault. The target (we’ll call him Peter) trusted his IT guy (Joe, for our purposes) because Joe worked magic.  Peter didn’t understand exactly what Joe was doi ...