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Accounts Payable Fraud
SEC Charges Two Koss Accountants with Embezzling $30M
The Securities and Exchange Commission has charged two Koss Corp. accountants with fraud amounting to more than $30M. The SEC claims the two accountants were embezzling money from Koss to pay personal bills and hid the fraud by overstating assets and understating liabilities.
Accountancy Age –
9/1/2010
Man Accused of Embezzling Sued by American Express
Kenneth Starr, the New York investment adviser accused of stealing over $59 million from clients, and his company are being sued by American Express for not paying over $350,000 in card charges.
Business Week –
8/25/2010
City Employee Charged with Embezzlement
The former clerk-treasurer of Mapleview city, Texas has been charged with embezzlement of public funds for allegedly issuing herself duplicate payroll checks and mishandling fire relief funds.
Austin Post-Bulletin –
8/27/2010
Former AP Manager Pleads Guilty to $4M Wire Fraud
Kimberly Prebles, former AP department accounting manager, pleaded guilty to wire fraud and to embezzling over $4 million from her former employer, Clark Western Building Systems, Inc.
7th Space –
8/25/2010
Four Men Arrested for Bank Fraud
Four business associates were arrested and accused of bank fraud, wire fraud and mail fraud for allegedly conducting a scheme to obtain $21 million in bank loans.
NJ News –
8/20/2010
Former Basic Employees Plead Guilty to Invoicing Scheme
Three former Basic Energy Services employees have pleaded guilty to felony mail fraud for using a series of false invoicing schemes to steal more than $500,000 in goods and services from their former employer.
Sidney Herald –
8/19/2010
Former Accountant Sentenced for Stealing Nearly $20M
Sonya Causer, former senior accountant, has been sentenced to eight years in prison for stealing nearly $20 million from retailer Clive Peeters to fund her property investments over a two-year period.
AAP –
8/19/2010
Arizona Developer Pleads Guilt in Fraud Case
John Wanek, an Arizona developer, has pleaded guilty in a $38 million in a fraud case where he gave false inflated financial information to banks to purchase homes.
Yahoo News –
8/17/2010
Card Payment Fraud: How to Control It
With card payments fraud becoming a growing concern, industry experts are wondering what should the Feds do about card payment fraud in the U.S.?
Payment Views –
8/16/2010
When Companies are Most Vulnerable for Fraud
Companies are most vulnerable when sales are up, the company is doing well and the biggest problems seem to be where to fit all the new equipment and employees. Success can distract managers from seeing financial issues like collection payroll taxes and verifying the accuracy of bills.
The Wall Street Journal –
8/16/2010
Notorious Credit Card Criminal Arrested
Vladislav Horohorin, a Russian credit card fraudster considered to be one of the most notorious stolen data sellers, has been arrested in France on charges in the U.S.
Tech Central –
8/16/2010
Small Businesses a Target for Fraud
Small businesses are victims of fraud more often than bigger companies, according to a recent survey by the Association of Certified Fraud Examiners. Thirty-one percent of all business frauds nationally were in companies with fewer than 100 employees.
The Wall Street Journal –
8/16/2010
14 Charge with Fraud
Thirteen Hawaii residents and one Washington state resident have been charged in an alleged scheme to defraud lending institutions by submitting false loan documents. One of the indictments charges 10 defendants in 56 counts of conspiracy, wire fraud and false statements on loan applications.
Business News –
8/12/2010
Former MCSi CEO Pleads Guilty to Fraud
Michael Peppel, former CRO of MCSi, Inc., a computer sales company, pleaded guilty to one count each of conspiracy, securities fraud, and money laundering for improperly reporting company revenues.
TMC Net –
8/11/2010
Five Men Arrested in U.K. for VAT Fraud
A HM Revenue & Customs investigation into suspected multi-million pound VAT fraud and money laundering has led to five arrests so far. The men arrested are allegedly part of an organized crime syndicate; believed to be creating a chain of companies and false paperwork for the purpose of reclaiming VAT.
Accountancy Age –
8/11/2010
Former Town Director Pleads Guilty to Embezzling
Joseph Lydick, the Purchasing Director for North Andover, Mass., has pleaded guilty to embezzlement in a scheme where he sold town equipment and pocketed over $20,000.
Eagle Tribune –
8/11/2010
ICTV's CFO Accused of Accounting Fraud
Karl Redekopp, former CFO of International Commercial Television Inc., allegedly turned millions of dollars of quarterly losses into profits by falsely accounting for ICTV's sales of the Derma Wand, a skin care appliance.
Accountancy Age –
8/10/2010
HP CEO Forced to Quit Over Expense Reports
Former Hewlett-Packard CEO has been forced to resign after submitting several false expense reports in order to hide an affair with a fellow employee.
Smart Company –
8/9/2010
Employee Theft on the Rise
Employee theft is on the rise with one in every thirty workers caught stealing. The average employee steals just under $1,000 before they are caught, totaling more than $69.8 million apprehended last year.
Times Herald-Record –
8/7/2010
Former GSU Employee Charged for P-Card Theft
Angela Garner, 23-year business manager at Georgia State University, has been fired and arrested after being charged with theft. GSU Police found that Garner bought a TV with her university purchase card after an audit found irregularities with Garner's p-card. Garner has confessed to the TV, but a GSU whistleblower informed the university that the TV is just the tip of the iceberg as far as fraudulent charges made by Garner; an investigation is currently underway.
WSB TV –
8/4/2010
Two Men Charged for Embezzling Over $200,000
Jason Winanecki, former manager, along with Emil Devcic, partial owner of ASC Inc., have been charged with embezzling over $200,000 from the City of Fond du Lac using a false invoicing scheme.
FDL Reporter –
8/4/2010
Tips for Preventing AP Fraud
AFX Corp. Inc., a document research and forensics company, has released tips on preventing accounts payable fraud; including separation of responsibilities, marking accounts payable checks "for deposit only" and making sure accounting statements get to the appropriate departments unopened.
PR Web –
7/30/2010
Former Office Manager Sentenced for $1M in Fraud and Tax Evasion
Former office manager for a Houston medical group has been sentenced to prison for tax evasion and fraud. Gina Holley, who was in charge of accounts payable and payroll, was misusing her company p-card, writing checks to herself, and withdrawing cash from company accounts totaling over $1 million.
Federal Bureau of Investigation –
7/29/2010
GE Settles with SEC for $23 Million
General Electric has settled with the Securities and Exchange Commission for $23.4 million on charges that it violated Foreign Corrupt Practices Act accounting and internal-controls provisions.
CFO.com –
7/27/2010
Former CEO Sentenced for Fraud
Former GlobeTel CEO Timothy Huff was sentenced to 50 months in prison for charges involving a $22 million securities fraud where he misrepresented GlobeTel's accounts receivables.
BNO News –
7/26/2010
Four Executives Arrested in $21M Bank Fraud Scheme
Four Manhattan businessmen were arrested for an alleged scheme to defraud Amalgamated Bank out of $21 million in loans. The men allegedly book fictitious sales, prematurely recognized sales and made older accounts receivable appear to have been incurred more recently in order to obtain $21 million in loans.
New York Post –
7/24/2010
City Find that Whistleblowers Value Anonymity Over Cash
Richmond City Council, in Va., found that whistleblowers are more interested in keeping their identity a secret than receiving a cash reward. They have found over the years that employees are more concerned with co-worker retaliation then being compensated for revealing fraud.
WatchDog –
7/20/2010
Man Charged for Filing False Expense Reports
Matthew Lind, the president of Legend Mechanical in Savage, Minn., was charged for allegedly stealing $22,000 from his former employer, Dakota Mechanical, by filing fraudulent expense reports.
Savage Pacer –
7/20/2010
U.K. Accountant Sentenced to Four Years in Prison for £1.3M Fraud
A U.K. accountant has been sentenced to four years in prison for fraud worth £1.3 million at the auto dealership where she worked. Tracey Laws, former accountant at Preston Hall BMW, committed fraud by issuing checks to herself and disguising the transactions as corporation tax payments.
Accountancy Age –
7/19/2010
Woman Sentenced for Stealing from Charity
Angela Cummings, former office manager for Habitat for Humanity, was sentenced to probation and agreed to pay back $3,417.33 which she stole by making fraudulent charges on her company purchasing card.
Star Tribune –
7/17/2010
AP Departments a Target for Fraud
Accounts Payable Departments are usually attractive targets for fraud. According to a report by the Association of Certified Fraud Examiners, nearly one-third of all fraud cases involved billing and invoicing.
CFO Daily News –
7/9/2010
Most Common Fraud Risk: Financial Statement Fraud
According to a recent survey by Deloitte, financial statement fraud is the most commonly expressed type of fraud risk that companies are concerned about in the next 12 months.
Accounting WEB –
7/6/2010
FISCAL Makes Upgrade to Software to Help with AP Fraud
FISCAL Technologies, a provider of accounts payable audit software, announced enhancements in its AP Forensics® software suite that help protect against supplier fraud, invoicing errors, and duplicate suppliers.
Source Wire –
7/7/2010
Courts Stop Scheme that Led to $10M in Unlawful Charges
A federal court has stopped an international scheme that used identity theft to place more than $10 million in charges on consumers' credit and debit cards. The defendants used phony company names and information taken from identity theft victims in the US to open more than 100 merchant accounts with companies that process charges to consumers' credit and debit card accounts.
Collections & Credit Risk –
6/28/2010
Former Enron CEO Fraud Case to be Reviewed
The conviction of former Enron CEO Jeffrey Skilling is being questioned after a US court decided to put his case up for review. The judge rules that Skilling's fraud conviction used law that only covered bribery and kickbacks, where his alleged misconduct did not include either.
Accountancy Age –
6/25/2010
Australia Reports Growing Amount of Employee Fraud
A recent collapse of an Australian retailer, Clive Peeters, a company whose experienced financial troubles due to an employee embezzling $20 million, has shed new light on the growing amount of employee fraud cases.
The Australian –
6/25/2010
BDO Seidman $521.7M Punishment Reversed
BDO Seidman LLP, a New York accounting firm who had previously been ordered to take responsibility for a clients' financial losses for failure to detect fraud, won't have to pay Portuguese client Banco Espirito Santo SA $521.7 million, according to a Florida appeals court.
Business Week –
6/23/2010
Former Employee Pleads Guilty to $1M Fraud
A former Fort Peck tribal employee has pleaded guilty to a scheme in which more than $1 million was stolen from the tribe's loan program. Dolly Crowe was involved in a scam to embezzle money from a credit program and tried to hide the thefts by altering computer information over a ten-year period.
Billings Gazette –
6/22/2010
Former Cameron Financials Executives Accused of Fraud
The former president and CEO of Cameron Financials, a lending company currently in chapter 7 bankruptcy proceedings, have been accused by the trustee handling the bankruptcy case of fraud, negligence and misrepresenting their financial dealings.
The Tribune News –
6/17/2010
Former AP Clerk Indicted for Embezzlement
Michelle Hogan, an accounts payable clerk for the Waltham company, has been indicted for allegedly stealing over $57,000 from her former employer. Hogan had allegedly entered her mother’s name into the company’s accounts payable system as a fraudulent vendor, and created false invoice entries that resulted in checks being made payable to her mother.
The Milford Daily News –
6/11/2010
Mother and Son Indicted for Scheme to Defraud Medical Center
A mother and son have been indicted by a federal grand jury for mail fraud and interstate transportation of stolen property in connection with a scheme to defraud the Baltimore Washington Medical Center out of $38,000. Margie Milisitz, a former employee of BWMC, was allegedly creating false invoices to trick BWMC's accounts payable department into issuing payments to her son, John Milisitz's, account.
7th Space –
6/6/2010
Former AP Clerk Pleads Guilty to $437,544 in P-Card Fraud
Betty-Lyn Ryan, former accounts payable clerk responsible for credit card billing at Vancouver Island Insurance Centers, pleaded guilty to fraudulently using her company issued purchasing card for personal use amounting to $437,544.
Canwest News Service –
6/4/2010
Diebold Settles with the SEC
Diebold Inc., automated-teller-machine (ATM) maker, has agreed to pay $25 million in a settlement with the Securities and Exchange Commission over their case on alleged fraudulent accounting.
The Wall Street Journal –
6/3/2010
SEC Charges Three Former Diebold Finance Executives
Three former finance executives, including two CFOs, from Diebold Inc. have been charged by the Securities and Exchange Commission with accounting fraud. The SEC filed a civil suit against Gregory Geswein, Kevin Krakora and Sandra Miller, claiming they have manipulated the company's books to meet earnings forcasts from 2002 through 2007.
The New York Times –
6/2/2010
Former AP Clerk Sentenced for Embezzling $700,000
Rhonda Warren, former accounts payable clerk for Ole South Properties, has been sentenced to 46 months in federal prison for embezzling nearly $700,000 through wire fraud. Warren pleaded guilty to creating fraudulent invoices to steal from her employer.
WSMV –
5/25/2010
Wisconsin Woman Sentenced for Bankruptcy Fraud
Pamela Kohlheim, a Milwaukee woman who collected over $540,000 from the state’s child care program, was sentenced to a year in federal prison, $40,000 in restitution and two years probation for hiding some of her day care income from bankruptcy court.
Journal Sentinel Online –
5/20/2010
New Century Owner Charged with $5.8M Bank Fraud
Kwong Hung "Eric" Lam, president and sole owner of New Century Enterprise Inc., has been arrested for allegedly defrauding an Israeli bank out of nearly $5.8 million by misrepresenting New Century's accounts receivables.
Capital –
5/12/2010
Former Detroit Public School Employees Charged with $3M Fraud
Stephen Hill and Christina Polk-Osumah, two former Detroit Pubic School risk management executives, have been indicted by a federal grand jury on charges that they stole more than $3 million form the school system.
Business Insurance –
5/11/2010
Former Office Manager Sentenced to Four Years for P-card Fraud
Kimberly Palmer, former office manager at Valley Metal Buildings, has been sentenced to four years in prison and ordered to pay approximately $144,000 in restitution for fraudulently using her company-issued p-card. Palmer was in charge of accounts payable, accounts receivable, payroll and bookkeeping.
Great Falls Tribune –
5/8/2010
Former AP Clerk Pleads Guilty to $400,000 Fraud
Cary Hollett, former accounts payable clerk at Annapolis Valley Health, has pleaded guilty to embezzling over $400,000 from his former employer in Nova Scotia.
The Chronicle Herald –
5/5/2010
Ex-Liburdi Employee Arrested on Embezzlement Charges
Sandra Huddard was arrested on new charges related to allegedly embezzling $365,000 from Liburdi Dimetrics Corp. over the past two years. Police reports claim she stole the money through a series of check and credit card schemes while severing as the accounts payable clerk.
Davidson News –
4/29/2010
Woman Sentenced for Embezzling Over $2.5 Million
Jamie Hoff, a former Expand International of America employee, has been sentenced to 33 months in prison after pleading guilty to an embezzlement scheme amounting in over $2.5 million from her employer.
Hartford Courant –
4/29/2010
Accountants Role in Detecting Fraud
Accountants are often exposed to fraud without even realizing it; not noticing the signs and signals of fraud can make it difficult to detect. Keeping current on laws and regulations can make it so accountants are able to identify the red flags of fraud to better assist their company.
Journal of Accountancy –
May 2010
Three More Arrested for Hanford P-Card Fraud
Three more employees have been accused of being involved in the Hanford Plutonium Finishing Plant credit card fraud case. Suzie Zuniga, former material coordinator, has been charged with 15 counts of wire fraud; Tommy Honeycutt, former pipefitter, and Pedro Alvarado Jr., former Hanford driver, each have been charged with five counts of wire fraud. Zuniga made approximately 220 suspicious P-card purchases, some in cooperation with Honeycutt and Alvarado.
The News Tribune –
4/23/2010
Former Farm Treasurer Accused of $2M in Fraud
Gary Gross, the former treasurer for Niman Ranch, was arrested for allegedly defrauding his former employer of nearly $2 million. Gross was allegedly making unauthorized transfers form Niman's bank accounts into personal accounts, and adjusting the books to cover his tracks for nearly two years.
San Francisco Chronicle –
4/23/2010
Dégarnissage Pleads Guilty to Tax Evasion by False Invoicing
Dégarnissage Demag Inc., a Canadian demolition company, pled guilty to tax evasion charges totaling $507,118. Dégarnissage was intentionally deducting false invoices from fake companies on its income tax return from 2004 to 2007.
Canada News Wire –
4/21/2010
Former Ernst & Young Employee Pleads Guilty to Millions in Fraud
Lily Aspillera, former executive assistant at Ernst & Young, pleaded guilty to mail fraud and tax evasion embezzling between $1 million and $2.5 million. She did this in many ways, including issuing over $1 million worth of checks to herself, overpaying employees so they would return the amount to her to keep, and paying her bills with company purchasing cards.
Ethiopian Review –
4/20/2010
SEC Accuses Goldman Sachs of Fraud
The Securities and Exchange Commission filed a civil complaint against Goldman Sachs claiming they fraudulently sold an investment that was preordained to fail. Goldman is speaking out against these allegations, claiming they "would never intentionally mislead anyone, and certainly not our clients."
USA Today –
4/20/2010
Two Charged in $50K Embezzlement Plot
Gregory Detloff, former Hanford employee, and Martin Perez, former Kennewick Industrial and Electrical Supply employee, have been arrested and charged with one count of conspiracy and 15 counts of wire fraud. Detloff and Perez allegedly embezzled nearly $50,000 from the company's p-card program by hiding the fraud as material purchases. If convicted they each face a maximum of 20 years in prison and a $250,000 fine.
The News Tribune –
4/16/2010
Former AP Supervisor Pleads Guilty to $230,000 Embezzlement
Mary Herrmann, former accounts payable supervisor for General Dynamics Advance Information Systems, pleaded guilty to embezzling over $230,000 from her employer. Herrmann created fake invoices from vendors, and then transferred the funds to a personal bank account. Herrmann faces a maximum sentence of 20 years in prison.
Faxts News –
4/15/2010
Study Questions Effectiveness of Whistleblowing Laws
According to a recent study by Bentley College and the University of New Hampshire, most reports of fraud through whistleblowing are ignored by management. The study questions the effectiveness of whistleblowing laws, and whether it is improving corporate governance.
Pittsburgh Post-Gazette –
4/11/2010
FBI Arrests Eight Men in Credit Card Scandal
Eight Ohio Men were arrest by the FBI for allegedly using consumer’s credit card information fraudulently to buy over a million dollars worth of merchandise.
Collections & Credit Risk –
4/8/2010
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