Airtouch Fraud Case

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

He transferred funds from WHA to his personal bank account and other accounts he had access and control too. Richard understated the amount of unpaid payroll taxes of WHA and its subsidiaries and by overstating the amount of loans made by him to WHA. As a result the financial statements and records were manipulated. He also directed purchasers of new issued shares to transfer the funds of the shares to accounts under his control. Around $6 million was taken and spent. The market value of WHA and the earnings per share were also inflated and overstated as well. This happened because of Richard falsely giving records to the SEC, WHA shareholders, and perspective new purchasers of stock by understating the real number of outstanding shares in the company’s financial statements. World Health Alternatives lost $41 million in total from all of the fraudulent activity.

Since their prices were way too low, eventually profit margins began to decline very fast, this resulted in millions of losses. Instead of disclosing and recording these losses, President Monus along with the CFO Pat Finn and two other high ranking officials, decided to cross out the correct numbers insert highly inflated numbers, during this a sub ledger with the real numbers was also being kept. After a few months of this practice Pat Finn the CFO took on the responsibility of altering the numbers. By mid 1990 Monus's refusal to raise prices led to even more cover ups and eventually more members of the organization began to get involved in the fake reporting including the manager of accounting and the Controller. By the time the fraud was discovered executives at Phar-Mor had misstated financial statements by over $500 million.

Access the "Litigation" section of the SEC's website at www.sec.gov/litigation.shtml. Click on "Accounting and Auditing Enforcement Releases." Click on "AAER-3234" filed January 20, 2011. Read the release and the related SEC Complaint. Summarize the release and complaint in 2-3 pages (12-point, double spaced).

Verizon Wireless officially entered into the communications market on April 4, 2000. A joint project of Verizon Communications and Vodafone, Verizon Wireless is the self-proclaimed leading supplier of wireless communication in the United States, offering service in more places across the country than any other service provider. While Verizon Wireless did not begin corporate operations until 2000, its history can be traced back many years.  The company’s roots can be traced to two distinct companies: Bell System and General Telephone & Electronics Corp. (GTE). Verizon Communications was formed on July 27, 1998, from a merger of

Their fraudulent plot was solely based on using investors’ money for their personal use and in order to keep the investors interested they falsified financial records and published misleading and misstated sales report (Justice News, August 25). “Harrison’s wife Lovena was charged with conspiracy to defraud the IRS after she filed a false income-tax return and structuring financial deposits to avoid having the money reported to the government”. (Gray, 2015) The fraudsters concealed their crimes by hiding and laundering their investor’s funds through the wife’s day care business.

Both Laventhol and Horwath, and Arthur Anderson accepted clients that were risky just to keep their revenues up. L&H knew there were things wrong with PTL, especially since they were doing things that were hidden from the Board, like the payroll account book, which was secret. The Bakker’s would call the senior L&H partner to keep the books updated. Anderson and L&H allowed their clients to use aggressive accounting practices that were questionable. Anderson destroyed Enron’s documents because they knew an SEC investigation was imminent. L&H and

• Conspiracy: “Stewart and Bacanovic "willfully and knowingly" worked together to obstruct justice and make false statements in the stock trading scandal. Verdict: Guilty.” (Press, 2004)

The SEC found three of Cardillo’s executives, CEO A. Walter Rognlien, COO Esther Lawrence, and Vice President of Finance William Kaye, guilty of violating several federal securities laws. All three executives provided false

The Seller will not be liable in any way for any delay, non-delivery or default in shipment due to labor disputes, transportation shortage, delays in receipt of material, priorities, fires, accidents and other causes beyond the control of the Seller or its suppliers. If the Seller, in its sole judgment, will be prevented directly or indirectly, on account of any cause beyond its control, from delivering the Goods at the time specified or within one month after the date of this Agreement, then the Seller will have the right to terminate this Agreement by notice in writing to the Purchaser, which notice will be accompanied by full refund of all sums paid by the Purchaser pursuant to this Agreement.

Armstrong and Dennis R. Balch in the Journal of Legal, Ethical and Regulatory Issues, Volume 18, Number 2, 2015 they interview two former Chief Financial Officers, Aaron Beam and Weston Smith to conduct qualitative assessment using the Banality of Wrongdoing Model. During the assessment Mr. Beam and Mr. Smith were asked fourteen questions to gauge “the culture of competition, ends-biased leadership, missionary zeal, legitimizing myth, the corporate cocoon, banality of wrongdoing and greed.” The authors of this study concluded that Mr. Beam and Mr. Smith did not attempt to justify or rationalize their behaviors or their part in unethical practices and accounting fraud but rather admitted to being fully aware of their actions and knew the ramifications of doing such. Rather than trying to justify their behaviors it became more of anxiety and stress to both of them, however they “used the defense that they were more or less forced into the behavior by the Chief Executive Officer, Richard

Case 10-10 An Offer You Can’t Refuse Fast Eddie, a publicly held company, manufactures and installs refrigeration systems for governmental and commercial applications. Fast Eddie is being investigated by a governmental agency for overpricing on government sales during the period from 2007 through 2009 as well as allegations of misrepresentations by one of Fast Eddie’s former officers, Sweet Lou. The criminal and civil investigations began in late 2009. In the prior fiscal year, the company’s auditors, CPAs-R-Us, obtained management’s representation and a letter from Fast Eddie’s independent legal counsel that indicated that the ultimate outcome of the investigation could not be determined and that any potential payment for the alleged

With the information that is provided by the video it can be determined that air bag fraud occurs because of the misrepairs and false advertisements of used cars. For example, the it is stated that in some cases the air bag compartments have been stuffed with beer cans paper or packing peanut. These cars are then sold or presumed as safe and sent off with the consumer in most cases the drivers of these vehicles are unaware of the condition of their care. In the case of Laura Vega was badly injured and her mother was killed when their Mercury saber was hit head on and the air bags did not deploy. In this instance the used air bag had been stuffed back into the dash board and it was taped shut. This is would be considered a case of white collar

Kamay was sentenced to seven years and three months imprisonment with a non-parole period of four and a half years, which was one of the largest sentences given in Australia for insider trading. He pleaded guilty to insider trading under section 1043A and 1311(1) of the Corporations Act 2001 (Cth), identity theft under section 142.2(1) of the Criminal Code Act 1995, and money laundering under section 400.1(1) of the Criminal Code Act 1995. Hill, however was sentenced to three years and three months with a non-parole period of two years and pleaded guilty to misuse of public office under section 142.2(1) of the Criminal Code Act 1995 and insider trading under section 1043A and 1311(1) of the Corporations Act 2001 (Cth).

The case of Enron Corporation and Andersen, LLP can be noted as one of the most infamous fraud scandals in US history. Investors lost millions of dollars and ruined the public’s trust. Enron was once the seventh largest public company in the United States and Andersen LLP was the world’s largest and most respected business organizations. Enron’s stock prices soared to approximately $100 to less than $10 in 2001. How did these two big giants fall into oblivion and what could have been done to avoid the disaster of these companies?