EY settles with the SEC

This week, the NY Times reported that the SEC reached a settlement with EY for its audits of Bally Total Fitness. The article reports that ...

Internet Urban Legends and Fraud

I'm always amazed at how many urban legends fly around cyberspace. Today I got one that had a video that purportedly showed President O...

New Stimulus idea: Promote fraud to create jobs!

This is the idea that a delegate from Russia seemed to espouse as he commented in a meeting yesterday. I was asked by the Marriott School to...

Madoff victims, SIPC and a zero-sum game...

How would it be to be in charge of deciding which Madoff victims get protection under SIPC and can receive up to $500k in government insuran...

Leadership and fraud

This short article in US News on leadership is worth scanning. It talks about the tendency to put leaders in charge of organizations who ar...

Fraud in science...

Where there's smoke there's fire... This from the WSJ : The public has every reason to ask why they felt the need to rig the game if...

Danny Pang Profile

The WSJ has an interesting profile on Danny Pang here .

More Madoff Accomplices Arrested

Today's WSJ reports : Two former computer programmers for convicted Ponzi scheme operator Bernard Madoff were arrested and charged Frida...

Fraud Research in the News

Forbes discusses the recent publication of Using Nonfinancial Measures to Assess Fraud Risk , by Joseph Brazel, Keith Jones, and Mark Zimb...

What is this guy thinking?!

The more I read about the former auditor for Bernie Madoff's Ponzi scheme, the more questions I have about this guy. The WSJ reported t...

Another guilty plea

Madoff's auditor, David Friehling, operated out of a small office in suburban New York and ran a three-person auditing firm that would b...

Madoff victims get some money

It was reported today that victims of Bernard Madoff's Ponzi scheme received $530 million which was guaranteed by the Securities Invest...

Madoff friend found dead in his pool

The Madoff case seems to get crazier each time a news report comes out on it! Last week's allegations were deemed too speculative for u...

Insider Trading Loss

More on Raj Rajaratnam's alleged insider trading scheme : the alleged scheme produced a net loss for defendants (from NYT ): Raj Rajarat...

Marc Dreier on 60 Minutes

This 60 Minutes segment on Marc Dreier is very candid and well worth the 13 minutes it takes to watch:

Catching Up: A Few Links

Another reminder that tax incentives and poor oversight are a great recipe for fraud (via WSJ ): ...Des Moines, population 200,000, is deali...

Alleged Insider Trading

You may have seen recent reports in the news of an alleged insider trading ring.  The WSJ points out that the "prominence of the alleg...

Enron Update

The WSJ reports that the Supreme Court will consider the appeal of Jeffrey Skilling, former President, CEO, and COO of Enron: The justices a...

Medicare fraud

Medicare fraud is a huge problem and has many dimensions. I've heard promises that the health care reform proposals will be partially fu...

The Madoff trustee has been busy lately...

The WSJ has reported two major lawsuits filed recently by the Madoff trustee. The first was reported yesterday and involves a $7.2 billion ...

Tell us what you really think Harry...

Here's a juicy quote from Harry Markopolos regarding the SEC's ability to find fraud: Harry Markopolos, the fraud investigator who ...

Fraud and motivated reasoning

Have you ever wondered why some victims of fraud end up believing the fraud perpetrator is innocent long after a loud and clear signal that ...

The tip of the iceberg...

Anyone want to guess what percentage of the stimulus funds will be taken by fraudsters? Nobody knows for sure. However, what we do know are ...

I know we have some political challenges in the U.S. but it could be worse...

I would say that this NY Times OpEd describes level of political corruption in Africa that makes our troubles sound pretty mild...

It sounds like the Lebanese Madoff studied under Bernie or Charles Ponzi himself when he designed his strategy to scam $1 billion from his f...

Sir Allen: Proof that what goes up must come down!

Here are a few quotes from a recent NY Times article reporting the woes of Sir Allen: (T)he Texas financier accused of a $7 billion fraud, ...

Madoff was taped telling Fairfield how to deal with SEC

As Bernie Madoff's dealings are revealed, it appears clear that he viewed his scheme as a game. Too bad for those who lost billions... H...

Insights on Madoff's interactions with the SEC

The SEC released the 22 page summary of the 450 page report detailing its interactions with Bernie Madoff. The NY Times article on this summ...

More on how Madoff kept his scheme going so long...

Information coming out about Madoff has been slow but here is the latest potential tip as reported by Bloomberg : Family members of a U.S. S...

"Fudge This"

The Big Picture reports that NZ Farming (NXZ) got into trouble with regulators for including a certain comment in their financial statement...

Huron and Arthur Andersen

Some of you probably have heard about Huron Consulting Group Inc's restatement recently. You should read this article about Huron's...

Stanford CFO Pleads Guilty

As expected, Stanford Financial Group's CFO, James Davis, pleaded guilty today to fraud and conspiracy, admitting that "he and othe...

PwC now being sued in Madoff case...

Victims in the Madoff case have now expanded their efforts to recover some of their losses by suing PricewaterhouseCoopers. A UK news report...

Overlap

Usually overlap would be considered an effective deterrent to fraud, at least from the corporate perspective. Internal controls that includ...

"Putting America to Work"

Shifting gears for a moment, I have to ask: Who thought it would be a good idea to put up signs like this at road construction sites all acr...

Foregone Opportunities...

From GoComics.com :

What do Bernie and Barry have in common?

Those of you who have studied famous fraudsters, you will know the name of Barry Minkow. Barry was the apparent whiz kid entrepreneur who st...

HealthSouth fraud: The rest of the story

The former CFO, Aaron Beam, of HealthSouth spoke at the recent conference of the Association of Certified Fraud Examiners. He tells a pretty...

A word to Ponzi schemers: Stay away from China!

The WSJ and AP reported that two Chinese individuals were executed for defrauding others in a Ponzi scheme in which they promised 10% retu...

A break in the Madoff case

The WSJ just reported that former Madoff aide, Frank DiPascali Jr., plead guilty to knowingly helping Bernie Madoff perpetuate his $50 bill...

100 years for $126 million fraud

Continuing the recent trend of harsh prison sentences for convicted fraudsters, Edward Okun was recently sentenced to 100 years in prison fo...

Apparently not all Madoff victims were victimized equally...

According to a recent article , the trustee in the Madoff case is suing Jeffry M. Picower so as to obtain $5.1 billion that was apparently ...

Mortgage fraud and bailing out the banks

As the government has been bailing out banks that are the "victims" of a crazy boom in housing, an investigative report shows tha...

Yachtzi Scheme

As further evidence supporting the claim that you can sell anything to 3% of the population , the WSJ reports that an outrageous Ponzi schem...

Bernie's lifestyle change...

News reports describe some fairly drastic lifestyle changes for Bernie Madoff now that he's in prison. Here are a few excerpts describin...

What's happening in New Jersey?!

A NY Times Op Ed offers these encouraging words to those who don't live in New Jersey: No matter what dreadful embarrassment your state ...

A minor $700 million Ponzi scheme

Last week, Mark S. Dreier was sentenced to 20 years in prison for running a $700 million Ponzi scheme. Since Bernie Madoff and Sir Allen St...

Satyam Fraud

A report by the Comptroller and Auditor General of India indicates that the Satyam fraud could have been uncovered in 2007 ( source ). Howe...

Schwab Faces Fraud Suit

Via the WSJ : In an official notice sent to Charles Schwab & Co. Friday, Attorney General Andrew Cuomo warned that his office plans to s...

Catching Up

I know what everyone must have been thinking over the past few days: the Zimbelmans must have been busted for running a ponzi scheme and it ...

Dodging the Regulators

Not only did Allen Stanford get help from Antiguan regulators , he also found ways to escape oversight in the US. The Miami Herald reports...

Ethics and Ponzi schemes...

The NY Times published an interesting article that describes how many Madoff victims are upset because the trustee, Irving Picard, is not c...

Behind Stanford's Back?

Stanford's number two man, former CFO James Davis, will plead guilty to the charges leveled against him. Stanford's lawyers respond...

Multimillion Dollar Legal Defense?

Before Allan Stanford can spend millions of dollars on his legal defense, he must prove that those funds are clean (via the Houston Chronicl...

Madoff's feeders reached all the way to Austria

The WSJ reported that prosecutors in the Madoff case are alleging that a fund manager in Austria, Sonja Kohn, received $40 million in kickb...

Did Madoff have inside help?

Hot off the press from The Washington Post : Genevievette Walker-Lightfoot, a lawyer in the SEC's Office of Compliance Inspections and ...

Beware of the scammers if you're looking for work.

The FTC announced a new push to crack down on the apparent increase in scammers who are preying on those who are looking for work. It seems ...

Sir Allen Stanford to stay jailed

The WSJ reported that the courts have decided that Allen Stanford needs to remain in jail until his court case is completed. The judge said...

More on Satyam's Auditors

Following up on Satyam's auditors , the Times of India reports that Satyam was not audited by PwC (emphasis added): The questioning of ...

Ruth Madoff breaks her silence.

Ruth Madoff issued a statement (see this link or the full statement below). Among other things, she implies that she is leaving him and has...

Mrs. Madoff's sacrifices and Bernie's prison sentence.

The WSJ reports that Mrs. Madoff has agreed to relinquish her fur coats (valued at $49k), linens and bedding ($18k) and silverware ($9k). S...

Judge to decide if $500 k bail bond is enough to stop Stanford from fleeing

If he really is the mastermind behind a $7 billion Ponzi scheme, do you think he would be worried about losing $500k ?

More on the $134.5 billion bond smuggers

Read this for a follow up to the counterfeit bond story posted on June 18th . In short, the bonds were obvious fakes, the Treasury Departme...

A dozen years for a $50 billion Ponzi scheme

Get this, Madoff's attorneys are asking that Bernie be sentenced to a mere 12 years in prison for running the World's largest Ponzi...

Skepticism and Common Sense

While changes in financial regulation (both changes in enforcement and structure) may provide additional comfort to investors in this post-M...

The latest Madoff news...

Speaking of penalties for fraud perpetrators and their families, the Wall Street Journal just reported that Ruth Madoff, Bernie's wife,...

Penalties of Fraud

Fraud perpetrators can be especially difficult to prosecute. As a result, many fraudsters lose their jobs, but face little or no other repe...

The soap opera fraudster: Danny Pang

Danny Pang is in the news again having reportedly taken $83 million from his firm before it was seized earlier this year. Watch out for thi...

Election fraud in Iran -- check the digits...

A former student of mine, Dan Leslie, pointed out an article in The Washington Post that analyzes the frequency of the last two digits in ...

Ever heard of click fraud?

Check out this article to read about the latest evidence that whenever there is money involved there will be some fraud perpetrators trying...

International Audit Quality

Among those charged in the Stanford fraud is a former chief of Antigua's financial regulatory commission. From USA Today : Leroy King a...

Madoff in the news again...

While Bernie Madoff awaits sentencing next week, the SEC has filed new charges against individuals who allegedly marketed Madoff's schem...

Richard Scrushy: crime doesn't always pay...

The largest financial penalty ever to be levied against a single executive has been given to 56 year-old Richard Scrushy for his role in the...

Sir Allen Stanford indicted

The latest news is reporting that Sir R. Allen Stanford was finally arrested by the FBI. Stanford is being indicted for running a massive P...

The mystery remains...

Although it's been 10 days since the Italian government seized a briefcase containing $134.5 billion in U.S. Treasury bonds, we still do...

Something smells fishy...

The WSJ reports : President Obama swept to office on the promise of a new kind of politics, but then how do you explain last week's dism...

The largest counterfeit ever?

Two Japanese men were caught smuggling $134.5 billion in U.S. bonds at the border of Italy. The bonds look very authentic and date back seve...

Fair-value accounting and fraud

The WSJ reported that: Wells (Fargo)'s Boston-based mutual fund Evergreen Investment Management Co. agreed along with its brokerage uni...

Great follow-up on yesterday's post...

A Colorado con man is revealed

This week's NY Times reports: The thick-muscled man with close-cropped hair who called himself Rick Duncan seemed right out of central ...