Despite the fact that bank officials uncovered a fraud, fired its mastermind, investigated and reported it to regulators, and then provided New York State prosecutors with over 900,000 pages of documents, a tiny Chinatown bank, Abacus Federal Savings Bank, was under put under indictment by a grand jury in New York State Supreme Court and… Read more »
Posts Tagged: Financial Statement Fraud
How many 112 year olds are taking new jobs?
A recent audit of the Social Security Administration revealed that thousands of workers over the age of 100 applied through the U.S. government to verify their employment eligibility in recent years. Questions: 1. About how many active Social Security numbers in the Administration’s master file belong to people who are at least 112 years old?… Read more »
Fraud at Florida-based adult entertainment businesses
Paul Anthony Ruggieri, accountant, pleaded guilty Friday to assisting in the tax fraud scheme of Anthony Andreozzi, the owner of two Florida-based adult entertainment businesses. Questions: 1. Based on the information in the article, how long had Mr. Ruggieri been Andreozzi’s accountant? Go to the Certified Fraud Examiner’s website and compare this amount of time… Read more »
Payroll Accounting Fraud
A former accountant for the University of Sioux Falls has been indicted for wire fraud for reportedly collecting more than $25,200 in unearned paychecks. Brent Alan Fowler, 52, faces 20 counts of wire fraud for individual payroll deposits. Questions: 1. What is the potential jail time for Mr. Fowler, if he receives the maximum punishment?… Read more »
Fraudsters are always looking for a way to rip off the Government
This article details a wheelchair scam that was designed to exploit blind spots in Medicare, which often pays insurance claims without checking them first. The fraud begins with criminals disguised as medical-supply companies. Questions: 1. Based on the article, which major internal control allowed this fraud to happen? 2. What type of control slowed down… Read more »
A Complex Financial Crime Story
Stephen Flatow, a grieving father, charged that Iran financed the Gaza bus bombing that killed his 20-year-old daughter in 1995. Buried in court filings, the suit alleged that money from a charity “fronted” financial transfers to terrorists from the Iranian government. In fact, the charity, known as the Alavi Foundation, actually operated and owned a… Read more »
The Dirty Little Secret of “Cramming!”
On July 1, 2014, the Federal Trade Commission (FTC) accused wireless carrier T-Mobile of adding bogus charges to customers’ accounts without their consent, in U.S. District Court. Questions: 1. How long did T-Mobile use the practice of “cramming” on customer mobile phone bills and what is the estimated amount of the total fraudulent charges? 2…. Read more »
Barclay’s Dark Pool
Despite Barclay’s private and public assurances to investors in its pool that they were continually shielded from high-speed trading, the bank is being sued for actively attracting high-speed traders to its venue, as well as bolstering high-speed trader strategies with privileged information about the pool. Questions: 1. Summarize why the article essentially called this a… Read more »
Seventeen police officers to ticket Gator fans?
Only 1,260 feet of Route 301 runs through Hampton, Florida, a city with a population of under 500. Yet between 2011 and 2012, Hampton officers wrote 12,698 speeding tickets. Now Hampton, an 89-year-old city, is fighting the state legislature threatening to wipe the town off the map, after a state audit last month uncovered significant… Read more »
Warning about Emails
Four former leaders of the law firm, Dewey & LeBoeuf, were charged by New York prosecutors with orchestrating a nearly four-year scheme to manipulate the firm’s books during the financial crisis. In emails they talked openly about “fake income,” “accounting tricks” and their ability to fool the firm’s “clueless auditor.” Questions: 1. Explain the role… Read more »