Case Study: BISD School

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 case of Rita Crundwell revolves around a town, other employees, and an auditor 's blind trust in a women, who clearly did not deserve the trust. Crundwell was the town Comptroller. The fraud resulted in 53 million dollars to be siphoned from the town 's funds in a time frame of 20 years. Crundwell covered her tracks with a fake bank account, fake invoices, and the party line of blaming the state for simply being behind on payments. There were many red flags during the two decades of this scheme, but due to the town 's small size and trusting attitude, they relied heavily on external audits, which were not up to par.

2) Frank A. Tassone; the former business manager, Pamela Gluckin; and an accounting clerk, Debra Rigano, who is a niece of Ms. Gluckin embezzled money in a scheme in which Dr. Tassone and Ms. Gluckin and nine of their family members and friends charged $5.9 million for personal items and cash advances on 74 personal credit cards. Then Ms. Gluckin and Dr. Tassone used district checks to pay those bills. The audit found that Dr. Tassone and

Garcia and Licata took a number of old invoices and issued checks in the invoice amount, subsequently cashing the checks and splitting the amount between themselves. DeLoach soon after joined them and deposited a number of checks, issued by Licata, into various personal accounts throughout Miami. DeLoach used the funds from the fraudulent checks to write checks to Garcia and Licata (Barnett, 2007).

The main objective of this investigation is to see if funds are being misappropriated and who is misappropriating these funds. In conducting this investigation we needed to take many steps to ensure that the tip that the department received was true. To begin we checked personnel records and company records to gather information (Albrecht, Albrecht, and Zimbelman, 216) on the suspect, Rita Crundwell. Information such as how long has this suspect has worked in the city, what her position is, and what it entails. We also went through the accounts that she is transferring the cities money into and verified that all of these are all legitimate accounts of the city. If we found any errors or accounts that were not legitimate we would note these down and ask Rita about these accounts during the interview.

Violations of the California False Claims Act (when illegal activities were reported against the district).

All parties involved in the accounting scheme except for Former CFO, Todd C. Crow agreed to settle out of court (subject to the approval of the U.S District court of Arizona) without confessing or refuting any fault. The parties involved included:

In October of 2011 investigators ended Kerry F, Khan’s schemes of bribery and kickbacks. For several years Khan had managed the Army Corps of Engineers, and had collected 30 million dollars through his trickery. He did so by hiring subcontractors that he made inflate their bills by adding products of services they didn’t actually do. He would certify it and

In July of 2010, Scott Rothstein was sentenced to 50 years in prison for running a US$1.2 billion

After his sex scandal he left Washington and he again reinvented himself and financed the construction of 7000 urban hoses. He was director of KB for three years. He received $70000 as pay and $100000 as stock, he received $1.14 million from directors and $5 million form countryside stock. He said his development work gives him several hundred thousand every year. All told, his paydays are modest to

Ashley Johnson is the sole owner of Johnson Real Estate, hereby referred to as “JRE”, which is a sole proprietorship (LLC) that lists and sells real estate in West Virginia. Ashley’s husband James is the president of JRE and is the day to day operator. Besides James, there are two employees: office manager Joan Rogers and receptionist Doris Chambers. The realtors are contracted sub-agents that personally collect commission checks at the end of each month. These realtors receive 65% of the commission granted to the broker, the rest is deposited into JRE’s checking account. Ashley noticed discrepancies in the commission receipts from closings and the actual bank deposits in the year of 20X9. The previous year there were no problems. JRE has not been audited for the past three years due to rapid growth. Ashley filed a report with the local prosecutor, a family friend, and requested a thorough investigation, which resulted in the prosecutor’s office contracting an accounting firm to complete the financial examination. The prosecutor’s office assigned special agents Thomas and Longworth to the case. The prosecutors are Gina Conrad and Barry Morton.

On April 21, 2001, Lee Farkas, the former chairman of a private mortgage lending company, Taylor, Bean, & Whitaker (TBW), was convicted for his role in a more than $2.9 billion fraud scheme (Schoenberg, 2011). This action contributed to the failures of Colonial Bank, one of the 25 largest banks in the United States, and TBW, one of the largest privately held mortgage lending companies in the United States. According to court documents and evidence presented at the trial, Farkas and his co-conspirators engaged in a scheme that misappropriated more than $1.4 billion from Colonial Bank’s Mortgage Warehouse Lending division and

September 2016, the US Southern District Attorney announced a 32-count indictment to 4 men, one being James Burkhart, the former CEO of American Senior Communities (ASC) a nursing home giant, along with 3 other men accused of a brazenly orchestrated with intentional infliction of a $16 million fraud case. Involving Medicare and Medicaid with overbilling and kick-back scheme from 2009 to 2015 in the state of Indiana.

(1) James M. Davis, CFO of Stanford International Bank (SIB) and Houston-based Stanford Financial Group, was sentenced today to five years in prison for his role in helping Robert Allen Stanford perpetrate a fraud scheme involving SIB and for conspiring to obstruct a U.S. Securities and Exchange Commission (SEC) investigation into SIB.

Main character in this fraud is Mr. Dennis Kozlowski, the CEO of Tyco. He misappropriated around $270 million through unauthorized loans, sale of Tyco securities and undisclosed compensation. In order to conceal these amounts, the compensation was incorrectly offset against unrelated gains. This led to violation of GAAP and misrepresented financial statements. For example, $44.6 million of bonuses were offset against gain from IPO of one of Tyco’s subsidiaries. They have also netted the bonuses with gain on disposal of business and gain on sale of common stock. According to ASC 718 Compensation, these and other bonuses should have been disclosed in operating earnings and should have decreased operating income. However, since they were offset against one-time gains, they did not have any impact on operating income. This “hiding” of compensation occurred on several occasions – the expenses were also netted against gain on sale