Who would have thought that a simple internet search could help you win a case in front of a jury? Just 10 years ago that may have sounded far-fetched to many. But those immersed in the world of data mining knew it was possible, even then.
The financial portion of a lawsuit is often high-stakes. This is especially true in cases of divorce, breach of contract, securities fraud, tax fraud, money laundering, and white collar criminal defense. Whether the other side is an individual, a company, or the government, you need an accurate analysis of the numbers for the benefit of your client.
In commercial litigation, many cases require some kind of expert.
Financial investigations have one common problem: Large volumes of data and documentation that need to be examined.
Starting Dec. 1, there was a significant change to the Federal Rules of Civil Procedure for expert witness reports.
I would like to think that most companies are committed to doing business honestly. They try to do the right thing, and when a problem is found, they try to correct it quickly.
Forensic accounting has been around for decades, but only in the last ten years have people become aware of the profession on a wide scale. Many of the techniques used by forensic accountants to investigate fraud and analyze the numbers are the same today as they were decades ago. Computers have made things easier, as [...]
It’s hard to believe that a Ponzi scheme as massive as the one perpetrated by Bernard Madoff got by anyone. Surely he was the most clever criminal alive, and was ingenious at hiding his fraud. There couldn’t have been any signs of the scam he was running. Or were there? It turns out there were [...]
There is no shortage of allegations of investment fraud since the stock market tanked last year. Last month attorney Marc Dreier was sentenced to 20 years in prison for heading a Ponzi scheme that caused investors to lose more than $400 million. Are there more investment scams occurring, or have market conditions just led to [...]
When fraud happens within an organization’s accounting system, there is often a paper trail left behind. It’s unavoidable, as there is a record of something related to the fraud, whether it is a legitimate invoice that was later adjusted, an account balance that was changed, or a fake employee who was added to the payroll [...]
A brief review of news stories related to mortgage fraud and real estate fraud shows there’s no shortage of schemes being uncovered and pursued. It’s not surprising. There are likely two main reasons for fraud schemes related to real estate being discovered at a high rate. First, the crash of the real estate market made [...]
Ask a random group of attorneys what they think of social media, and you’ll get some funny looks. Several of them will turn up their noses, while an equal number will have no idea what you’re talking about. A few may have a favorable opinion of social media, and a couple may even participate in [...]
Consumer outrage about “bailout madness” and the proliferation of Ponzi schemes and investment fraud is fueling a push for greater oversight and regulation. The government is talking tough, saying that there will be more prosecutions for financial fraud forthcoming. That sounds good, doesn’t it? Of course we’re all in favor for more aggressively pursuing those [...]
If you thought that the $50 billion Ponzi scheme allegedly perpetrated by Bernard Madoff is big, get ready. The amount of fraud that is sure to arise out of all the federal government bailout activities will dwarf that by many multiples. How do I know? The sheer magnitude of the bailout activity, coupled with the [...]
Executives, consultants, and business analysts are currently asking themselves a critical question: Does a major economic downturn increase a company’s chance of being hit by employee fraud? The answer to that question isn’t immediately clear. Fraud experts are often quick to theorize that difficult economic conditions naturally create a higher instance of workplace fraud. The [...]
Recent news of the alleged $50 billion Ponzi scheme perpetrated by investment advisor Bernard L. Madoff has done nothing to ease the fears of investors who have been annihilated by the stock market over the last couple of months. How does an investment opportunity go from being a legitimate investment vehicle to a pyramid scheme? [...]
One of the last places you’d expect to find fraud is in a law practice. Like accounting, the practice of law is a profession in which ethics are of utmost importance. Accountants and lawyers are often too trusting of their fellow professionals, and therefore leave themselves open to the risks of fraud. The issue of [...]
The question I have been asked more over the last few weeks than any other question is: “How big of a role has fraud played in this Wall Street bailout?” I wish that was an easy question to answer. It’s not, because fraud has played a role in many aspects of the whole financial drama [...]
When a company discovers an internal fraud, it’s not uncommon for owners and management to look for a party to blame. After all, someone should have known that a fraud was in-progress, right? Often, the blame is cast in the direction of the auditors. The auditors are an easy target. Not only do they usually [...]
One of the key parts of Sarbanes-Oxley, the legislation created to address the problem of massive financial statement fraud at public companies like Enron and WorldCom, was the increased prison sentences for executives participating in fraud. Supporters of the legislation cheered harsher potential punishment for executives as one of the keys that would help prevent [...]
As the panic continues about the “subprime mortgage crisis,” pressure has been put on regulators to do something to stop mortgage fraud. The “crisis” has been blamed largely on corrupt mortgage brokers, and so last week the Federal Reserve adopted new mortgage regulations. Before discussing what the rules will and won’t do in regard to [...]
A few years ago, I got called for jury duty. Unlike almost everyone else who complains when called for jury duty, I was thrilled. I wanted to be on a jury. If I was going to have to do my civic duty, I wanted to get something out of it, rather than just sit in [...]
It’s become far too common to hear news reports of financial fraud at churches. Is fraud at religious non-profits increasing, or are we just hearing more about it during a time when the topic of fraud is at the forefront? I’d like to think that fraud at churches is simply more newsworthy than it used [...]
What on earth do fraud and infidelity have in common? Quite a lot actually. While there may be no scientific studies available that analyze the correlation between financial fraud and infidelity, anecdotal evidence obtained while working in the field of fraud investigation for more than a decade suggests there is a correlation. A discovery of [...]
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A lawsuit against Wachovia Bank by a group of defrauded consumers raises some interesting issues related to third-party fraud liability. The question for consumers, investors, and executives is: What is the threshold for liability in fraud cases? What knowledge or actions had to be present in order for a person or company to be held [...]
One often overlooked key to successfully working with an expert witness is the protection of privilege and work product. Until the expert is actually disclosed to the other side, it’s in the best interest of the client to make sure that the expert’s work is protected. While no airtight accountant-client privilege exists, it is still [...]
While investigating fraud for more than a decade, I have consistently been amazed by the disparity among criminal sentences in financial fraud cases. Of course, there are many facts that go into a sentencing decision, and so it is difficult to make an apples-to-apples comparison of sentences between cases. However, it’s clear to me that [...]
You thought only people experience identity theft. Only individuals become victims of dumpster diving or poor computer security. Someone gets a credit card in your name, and you’ve become a victim. You didn’t even consider that a company could have an “identity” that could be stolen. Corporate identity theft is becoming all too common, and [...]
