...While searching for a case that dealt with check fraud, one case regarding a North Carolina man who used fake checks to acquire over 650,000 dollars in post office stamps and other merchandise came up. According to the United States Department of Justice website, Jimmy Lee Williams was charged with twenty-nine felonies due to check fraud. The web article, “Man Charge In Post Office Scheme” explained how Williams along with other accomplices were able to acquire the large sum of merchandise by using fraud checks and false identification. There were two moments in the time frame from November 2010 till 2015 where Williams and the other conspirators went to the post office and small businesses and purchased a variety of stamps, gift cards, and other merchandise. Williams would give his sixteen accomplices the checks and they all targeted stores in North and South Carolina along with neighboring states. In Williams’ indictment, or formal charge, the face value of the items totaled 650,000 dollars and the first offense that occurred, Williams used checks that were made by Ronald Carr (Justice, 2015)....
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...COVER STORY: INTERNAL FRAUD CASE STUDY Prepare a two-to-three page case study report on the following case: COVER STORY: INTERNAL FRAUD on pages 104-106 in Chapter 4: Billing Schemes of the Fraud Examination text by Wells. Discuss the coincidences involved in this case study. Use the 2009 Global Fraud Survey (also located in Doc Sharing) for references concerning perpetrator, size of fraud, detection, and controls. This case is about the $4 million embezzlement fraud by an employee of a magazine publisher, and how the fraud was discovered. The type of fraud discovered was a billing scheme that was found on accident. A billing scheme is, “Any scheme in which a person causes his employer to issue a payment by submitting invoices for fictitious goods or services, inflated invoices or invoices for personal purchases.” 1 In this case, it just so happened that the new chief internal auditor decided to stop by the accounts payable department to collect a series of recently submitted invoices so that he could meet with the vice president to understand how the accounting codes work. In doing so, they found that a number of invoices had been forged. According to the 2010 Global Fraud Studies, “11% of the time, victim organizations either had to stumble onto the fraud or be notified of it by a third party in order to detect it.” 2 With coincidence one, the investigation revealed that the forgeries were coming from the painting operations in its facilities department, in which was overseen...
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...| Computer Fraud | | By | [Type the author name] | 9/14/2013 | DeVry University’s Keller Graduate School of Management | A University of Oklahoma student was charged with computer fraud on May 16, 2013 by the Cleveland County District Court. The University of Oklahoma student, Roja Osman Hamad, is accused of improperly changing his grades. Roja Hamad now faces five counts of computer fraud. Mr. Hamad was a former student employee of the university’s information technology department. This is where Mr. Hamad was able to access the university’s computer system to change six faculty member’s passwords without the faculty member’s permission. University official’s state, Roja Hamad broke into the university’s computer system and changed his grades. Roja Hamad fits the majority of the profile of the average fraud perpetrator. According to the ACFE, the average fraud perpetrator has no prior fraud charges or convictions and is more likely to be male rather than female. The ACFE states that the offender is commonly between the ages of 31-45. Even though Mr. Hamad is only 24 years old, he possessed the knowledge to commit the fraud. Since Roja Hamad was a student employee of the university, he was probably a trusted employee. As a trusted employee of the University, this gave Hamad an opportunity to perpetuate the fraud. Lack of proper internal controls, failure to enforce controls, and incompetent management personnel enabled Hamad to commit the fraud. The three...
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...The Fraud of the Century: The Case of Bernard Madoff 1. What are the ethical issues involved in the Madoff case? Not only is what Bernard Madoff did highly unethical but for his company to be able to pass the tax audition imposed question on the SEC internal system a farce. I guess Madoff bribed the auditors. I guess the saying money talks holds true for some. How people could morally falsify documents for money is just beyond comprehensible. To even take advantage of an innocent person is unfathomable. The ethical issues I saw were a manipulation of cash flow to make his company appear to be more valuable than it truly was and his company’s financial reports were never made public during the scheme. How is it that no one ever questioned that and he got away with it? Again, all I can think of is bribery. Makes you sort of wonder how people supposed to be dealing with the law can just break it without question and get away with it. 2. Do you believe that Bernard Madoff worked alone, or do you think he had help in creating and sustaining his Ponzi scheme? Would this represent a conflict of interest? I feel Bernanrd Madoff had help with the Ponzi scheme. Even the smartest of people need help. I don’t feel a scheme like this could be concocted or carried out alone. For no one in his company over the course of the thirty years in which he carried this scheme out to have even picked up on it is just shocking to me. Not even the accountant or auditors with respect to the financial...
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...Fraud a. A bride asked one of her best friends to be her bridesmaid, and her friend responded quickly by accepting the request to be her bridesmaid. However, the friend lives in different state, and she has very demanding job that will not allow her to get off to travel for few days. b. An athletic trainer who has very good job and beautiful girlfriend asks his girl friend to marry him, and she express her interest that after the weeding she want to have kids right away. He agreed with her knowing he will not be interested to have kids. 3. Defamation of Character a. Many celebrities had sued false publishers for damage to their...
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...The effects of health care fraud are far-reaching, and the costs, according to the FBI, amounts to tens of billions of dollars annually. With a struggling health care system, the amount that is lost to fraud is unimaginable and if recovered, could serve as a bolster to the waning system. The steps taken by our federal agencies to eliminate this problem include offering educational resources and tools aimed at educating and warning against such illegal acts. In order to deter these acts, a number of laws are in place that outlines specifically what is and is not permissible and encourages compliance with said laws. The laws that relate specifically to this topic are the False Claims Act (FCA), the Anti-Kickback Statute (AKS), the Physician Self-Referral Law (Stark Law) and the Social Security Act; in addition to those law specific to this topic, there are...
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...Case Study 1: And the Fraud Continues Forensic Accounting July 22, 2012 Abstract This case represents features of organized crime, occupational fraud and abuse. Most of these crimes involve many individuals and organizations as well as management and/or co-workers that are in a lot of social and financial pressures. Some of the crimes related with organize crime will be money laundering, mail and wire fraud, conspiracy and racketeering. With an internal control weakness employees would always look for opportunities to commit fraud or use company assets without permission. Within this case, we will see multiples internal control weaknesses that allowed Pavlo to perpetrate the fraud and how he used the tricks to mask the whole scam. We also are going to think on what was Wanserski position when Pavlo was performing the fraud. We will explore the investigation process and what type of procedures the auditor/investigator needs to follow in order to gather all the evidence. We will have the opportunity as readers to determine if MCI also had a fault by permitting or putting the pressure on his employees to comply with some guidelines instead of looking for ways to help employees to improve their work areas. Internal control is the method intended to ensure dependable financial reporting, effective and efficient department operations, and business compliance with related laws and regulations. Not having an effective internal control process will allow fraudsters like...
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...Bill MakkawiJuly 22, 2012 | Case 1 And Fraud Continues Forensic Accounting A company can’t work with a strong and secure accounting system. The accounting system should include strong internal controls to make sure financial statements and data are accurate and valid. Strong internal controls can prevent a company from providing false data to make their company look more profitable and steal funds from the investors and stockholders. There are several internal control weaknesses that existed at MCI that contributed to the commission of the fraud acts. One major internal control weakness was that Pavlo was able to manipulate the accounts receivable system and the changes he made to the system was not reviewed or approve by anyone. Another weakness was that Pavlo helped create the accounts receivable process and therefore knew the strengths and weaknesses of the process. This allowed Pavlo to manipulate the records to his advantage. The lack of segregation of duties takes place here because one employee was able to receive payments, update accounts receivable records and reconcile the company’s bank account. In addition to the duties listed above Pavlo was also able to write off receivables without review which played a major role in his act to commit fraud. Pavlo used his position to his advantage and was able to come up with tricks to help him steal millions from this employer. This gave Pavlo the opportunity to be able to embezzle money from the company and was able...
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...companies to make sure financial information is accurate and valid. Strong internal controls are signs of a financially healthy company and protect the company’s integrity. Strong internal controls can also increase a company’s profitability. There are several types of internal controls that companies used to protect themselves such as: Segregation of duties, asset purchases, supervisor review, internal audits and adequate documents and records. This paper will discuss several topics from a case study about And the Fraud Continues; it’s basically about a Fraud case with MCI. The following questions will be answered below 1) Discuss the internal control weaknesses that existed at MCI that contributed to the commission of this fraud, 2) Identify and justify the approach you would take if you suspected fraudulent activity within an organization where you work, 3) Critique the ethical nature of Pavlo’s actions in the case and 4) Apply one (1) theory related to crime causation to this case. The internal control weakness that exists at MCI was Pavlo; he was able to manipulate the AR (Accounts Receivable) system because he was the creator and developer. The lack of segregation of duties takes please here because the same employee is able to receive payments, update accounts receivable records and/or reconcile the company’s bank account. This gives the opportunity to be able to embezzle money from the company (http://smallbusiness.chron.com/strengths-weakensses-accounts-receivable-35111...
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...‘’Earnings management, in exchange listed companies, is not fraud but a case of caveat emptor for investors ‘’ UP708386 ‘’Earnings management, in exchange listed companies, is not fraud but a case of caveat emptor for investors ‘’ UP708386 708386 Corporate governance, Financial Crime, Ethics & Controls for Finance Pathways (U234479) 708386 Corporate governance, Financial Crime, Ethics & Controls for Finance Pathways (U234479) ‘’Earnings management, in exchange listed companies, is not fraud but a case of caveat emptor for investors ‘’ This essay is intended to evaluate different views on a case whether the earnings management in exchange listed companies is consider as a fraud or caveat emptor for investors. One of the first mentions of earnings management has been given by Shipper where she described it as ‘’disclosure management, in the sense of purposeful intervention in the external financial reporting process, with the intent of obtaining some private gain.’’ (Shipper, 1989). In other words the managers are adjusting profits or losses on final accounts to mislead the stakeholders and to encourage them from investing. Earnings management become a problem for investors as it generates fake impression about companies success and misguide them into making wrong investment decisions which often leads to a making a loss. Another problem arises with incorrect financial reporting which is insincere for investors and resulting in making a capital market...
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...CASE STUDY #1 | The Function of Accounting Information Systems in the Enron and Bernard Madoff Fraud Cases | | | | | | | What is the definition of accounting information system? The Core Concepts of Accounting Information Systems textbook defines accounting information system “as a collection of data and processing procedures that creates needed information for its users” (Bagranoff, 2010). A key factor in determining the success in an organization is its accounting information system. It is the combination of the organization’s resources, such as its people, procedures, and business records that it (the organization) maintains to provide financial data. The basis of this case study is to disagree with the question of whether or not accounting information systems played a role in the Enron and Bernard Madoff fraud cases. All organizations should have an adequate, effective, and efficient accounting information system in tack. In my opinion, the Enron and Bernard Madoff fraud cases had the classic signs of pure greed; the accounting information systems were perhaps manipulated, ignored, and compromised to financially suit the personal gains of the individuals involved and did not assist with the cases. An important part of the accounting information system is its internal control system. Internal controls are methods and procedures used by an organization to safeguard assets, authorize transactions, and ensure accuracy of the accounting records...
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...| | |Financial Statement Fraud | |Navistar International Corporation | | | TABLE OF CONTENTS |Introduction |3 | |How the Fraud was Perpetrated and Concealed |4 | |Start Up Costs |4 | |Estimated Warranty Expense |4 | |Rebates |5 | |Tooling Buyback Arrangements |6 | |Auditor Misconduct & NFC Overstatement...
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...indicate, that the purpose of the emergency meeting was to review a report generated by a Special Investigative Panel for Review of Executive MBA Program Records. The subject surrounding this case was Heather Bresch, a West Virginia University graduate who falsely claimed to have received a MBA degree from the university. According to announcements made by Mylan Pharmaceuticals in October, 2007, Ms. Bresch had been promoted to their chief operating officer. Shortly after this announcement a local newspaper, the Pittsburgh Post-Gazette published an article stating that Ms. Bresch in fact did...
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...An auditor may increase the nature, timing, and extent of substantive tests affiliated with controls regarding the transactions related to international sales ( PCAOB, 2013, AS 2201: No. 5). 4. Consult Paragraph 52-53 of PCAOB Auditing Standard No. 12. For one of Sunbeams Revenue Types ( please choose one), brainstorm about how a fraud might occur. Next identify an internal control procedure that would prevent, detect, or deter such a fraudulent scheme. Answer: Engagement team members should think of ways the organizations financial statements might have material misstatements caused by fraudulent acts and how assets of the organization may be improperly recorded ( PCAOB, 2013, AS 2110: No. 12). “The discussion among the key engagement team members about the potential for material misstatement due to fraud should occur with an attitude that includes a questioning mind, and the key engagement team members should set aside any prior beliefs they might have that management is honest and has integrity” (PCAOB, 2013, AS 2110: No. 12). Professional skepticism should be employed by engagement team members when conversing about the possibility of material misstatements in the financial...
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...Cases of Fraud in an Organization In a non-profit organization of a university, the members let's call her Mrs. X served as chairman of a depertment within the organization, which is take care of and responsible for a work program that focuses on social activities that are the main focus not for profit, the source of funds provided by the university through a proposal which has been accepted and legalized fund its budget and has received the first disbursement of funds as much as 70% of 100% of funds approved by the university. At the end of the year when Mrs.X asked to submit Accountability Report (LPJ), accompanied by evidence of transactions such as bill and receipts for the activities that have been completed, as evidence of the activities take place in accordance with the proposal that has been submitted or approved. But there is a problem on the evidence of transactions because most evidence of transaction already lost and the funds should be spent until depleted accordance with the budget proposal approved, but in fact not been spent . The consequences to be received that organization if was not fully spent, the funds are cutting funds for next year's activities. Knowing the consequences that will be received, finally Mrs.X looking for ways to not cut funding for next year by looking for empty memorandum, the memorandum of a used, and receipts to make a number of budget proposals and LPJ same or balance. Mrs.X not work alone, but she was aided by her friend in gathering...
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