American Iternational Group

The case Charles Schwab & Co. Inc. v. Douglas Castro asserts that Douglas Castro, a former

In this case, there are several conspirators who is involved in the fraud receiving punishment from either SEC or federal government. Robert Levin, the AMRE executive and major stockholder, and Dennie D.Brown, the company’s chief accounting officer, were subject to the punishment in the form of a huge amount of fine by the SEC and the federal government. This punishment came from reasons. After AMRE going public, the company have the obligation to publish its financial reports but its performance did not meet expectation. The investigation by SEC shows that Robert took the first step of this scam, fearing the sharp drop of AMRE’s stock price because of the poor performance of company. He abetted Brown, to practice three main schemes to present a false appearance of profitable and pleasant financial reports. Firstly, they instructed Walter W.Richardson, the company’s vice president of data processing, to enter fictitious unset leads in the lead bank and they originally deferred the advertising cost mutiplying “cost per lead” and “unset leads” amount, so that they deferred a portion of its advertising costs in an asset account. The capitalizing of advertising expenses allowed them to inflate the net income for the first quarter of fiscal 1988. Secondly, at the end of the third and fourth quarters of fiscal 1988, they added fictitious inventory to AMRE’s ending inventory records, and prepared bogus inventory count sheets for the auditors. Thirdly, they overstated the percentage

The Enron and WorldCom scandals were arguably the incidents that permanently changed the procedures for accounting controls. In response to these incidents, the Sarbanes-Oxley Act (SOX) of 2002 was passed. Once the knowledge of these scandals was made public, a number of subsequent accounting scandals were discovered in public companies such as Tyco International, HealthSouth, and American Insurance Group. In addition, a then-employee-owned company, Post, Buckley, Schuh & Jernigan, Inc. (dba PBS&J, now known as “Atkins North America, Inc.”), was also hit by a similar accounting scandal. Henceforth, a case study of PBS&J is presented where we will examine the fraudulent transactions that

The Molex Corporation is an electronic connector manufacturing firm, which is based in Illinois. This company is facing a financial reporting problem in which the financial statements were overstated. Joe King ,the CEO of the company, was appointed in July of 2001, and was responsible for managing and inventory control, among other very important duties. Diane Bullock was hired in 2003, to replace the previous CFO. Both Bullock and King were being accused of what? by the external auditors, Deloitte & Touche, for not disclosing an 8 million pre-tax inventory valuation error.

How strong is the case? It is not definitive given the information available but in reality the truth does not matter. Mounting a defense against the SEC makes little sense for Begelman. Being a civil case, criminal charges are not a consideration. The state is seeking a civil penalty and a repayment of the gains (Securities and Exchange Commission). If Begelman surrenders his profits and pays a penalty of $15K he is able to avoid any admission of wrongdoing (Gehrke-White). Thus, it is pragmatic and financially beneficial (avoid prolonged legal fees) for Begelman to settle and move on regardless of his actual guilt or innocence. The only winner in the case is the State. The SEC effectively extorts $30K from the defendant by

On May 26, 2016, the United States Court of Appeals for the Eleventh Circuit in SEC v. Graham, No. 14-13562 (11th Cir. May 26, 2016), reached an important decision. The court extended the reach of 28 U.S.C. § 2462, the five-year statute of limitations for “any civil fine, penalty, or forfeiture” applicable to enforcement actions by the Securities and Exchange Commission (“SEC”). The court held that SEC enforcement actions for declaratory relief and disgorgement were subject to the five-year statute of limitations. The Eleventh Circuit built its ruling on top of a decision by the Supreme Court, Gabelli v. SEC, 133 S. Ct. 1216 (2013), which held that 28 U.S.C. § 2462 applied to SEC civil penalty actions.

Access the "Litigation" section of the SEC's website at www.sec.gov/litigation.shtml. Click on "Accounting and Auditing Enforcement Releases." Click on "AAER-3234" filed January 20, 2011. Read the release and the related SEC Complaint. Summarize the release and complaint in 2-3 pages (12-point, double spaced).

This is a list of organizations led by undocumented students and their allies working at the local, state, and national level to support all undocumented immigrants. Through these organizations undocumented student can begin connecting to other undocumented young people locally and across the country. Also, undocumented students can keep up with current campaigns, advocacy work, and policy changes about the undocumented immigrant community.

“Interest groups are no less a threat than they are an expression of freedom” (Berry, 1984).

     The legal system is an essential element in the successful operation of this country. It is a system that is utilized every day, by every type of person, from the average blue-collar worker to the average Wall Street broker. There is a multitude of ways that the legal system is put to use. One such way is the class action lawsuit. A Civil Action, by Jonathan Harr, uses the account of a single case, Anne Anderson, et al., v. W.R. Grace & Co., et al, to illustrate the power and importance of class action lawsuits in the civil justice system.

This particular case, involving the SEC, Coopers & Lybrand, and California Micro Devices, Inc. encompasses charges for neglecting to comply with auditing standards. The Securities and Exchange Commission makes these charges against Michael Marrie, audit partner, and Brian Berry, manager, of Coopers & Lybrand. There are three main areas in which the auditing standards were not in compliance, a write-off of accounts receivable, confirmation of accounts receivable and sales returns and allowances. The Securities and Exchange Commission make these accusations against Michael and Brian for failure

Interco Summary of the Case Even before we go into the specifics of the case, we can point out a few important pieces of information from the case: 1) Interco management and Wall Street analysts believed that the apparel group’s performance would continue to weaken Interco’s overall operations and cause the equity markets to undervalue its common stock. Case Page 4. 2) To deter any unwanted third- party acquisition, the board voted on July 11, 1988, to amend Interco’s shareholder rights plan, making any hostile takeover of the company prohibitively expensive. Case Page 4. 3) Interco had retained Wasserstein Perella pursuant to a unique compensation contract that offered a substantial contingency fee of $3.7 million payable to Wasserstein

KPMG was one of the biggest accounting firms in the 90’s that with a lucrative end, would serve wealthy companies using forged revenues in order to avoid taxes. The accountants that worked for the firm were expected to meet certain quotas. Consequently, instead of trying to run an honest business they were trying to maximize the sales using all kinds of dishonest marketing approaches. KPMG employees used foreign banks as well as bogus law firm statements to preserve a legitimate business running. This accounting firm manipulated financial data of clients, costing the internal revenue service over 2.5 billion in lost tax revenue

Stockholders took a significant hit from the events relating to the restatement with earnings per share dropping an estimated average of 42% over the restatement period. The price of the company’s stock also fell. Prior to the discovery, Huron’s stock had reached an artificially inflated price of $83.25 per share and fell to a low of $13.69 per share after the restatement announcement, the unrelated SEC inquiry and the resignation of the company’s CEO, CFO, and CAO. The stock’s decline in value relating to these events triggered other issues and pending liabilities for the company. Persons who purchased or otherwise acquired the common stock of Huron between April 27, 2006 and July 31, 2009, filed a class action lawsuit against Huron and certain officers for violations of the Securities Exchange Act of 1934.

A more in depth look will be provided in relation to this case and the Securities Act of 1933, but in relation to the Known Users Approach and this case, the Securities Act of 1933 protects solely investors who initially purchase stock (Whittington & Pany, 2012). These users only need to prove that they incurred a loss as a result of the misleading registration statement; they do not need to prove negligence on the part of the auditors (Whittington & Pany). In this situation investors, and rightly so, seem to have the greatest level of financial protection. They can claim damages if they are the initial purchaser and need little proof other than their purchase and the damages sustained. If this case were to be considered under the Restatement of Torts or Foreseen User Approach, the issues surrounding the third-party users changes because the identity of the third-party users does not need to be known in the auditors reports (Whittington & Pany). The main reasoning behind this line of thought is that when carrying out an audit under a contractual agreement, it is known that third parties will rely on the information provided in the auditor’s reports, even if those third-parties are not specifically known at the time of reporting