Portfolio

portfolio

04: Portfolio

Our founder has 25 years of global audit and investigation experience and has served in hundreds of notable audit investigations for the Federal government.

“[auditing firm] with knowledge and expertise on government contracting.” – *

While some fraud investigations have involved sophisticated multi-billion-dollar weapons systems and enormous Fortune 500 companies, many have been connected to smaller companies and contracts. Items such as computers, uniforms, vehicle parts, office equipment, security, and construction materials have been used to manipulate the bottom line.

Even small janitorial companies that perform services for the government have engaged in conduct that cheated the government and created liability under the Federal False Claims Act.

The Federal False Claims Act is broadly written in an effort to bring prime contractors and their subcontractors within the orbit of the law. Even a small subcontractor violates the False Claims Act when he or she misrepresents contractor performed services or delivered products.

Various examples of fraud discovered:

  • Over-billing the government in any number of ways including: a) billing for services or products that were not provided. b) shifting the costs of a fixed-price contract to the costs of a cost-plus contract. or c) absent justification, in any other way inflating or misrepresenting the costs of cost-plus contracts.
  • Providing defective parts or parts not manufactured in accordance with specifications.
  • Failing to disclose product defects.
  • Providing services or products that were not provided or manufactured in accordance with procurement regulations including those governing: a) environmental compliance, b) labor standards, c) Buy American Act requirements, d) worker health and safety protections, and e) bidding.
  • Failing to engage in the proper inspection required by contract where a product is being provided.
  • Other types of fraud found related to education, securities, pharmaceutical, Medicare and Medicaid, contractor, subcontractor, loans, federal, state, local and individual, and financial statements (corporate and individual).

“[working with FA Matters] ultimately resulted in a change in cashier policies to prevent future fraud.” – *

Embezzlement is defined as the theft or larceny of assets (money or property) by a person in a position of trust or fiduciary responsibility over those assets. This happens when offenders are given lawful possession of the property, and then accused of converting the property for their personal use.

More specifically, accounting embezzlement is the manipulation of accounting records to hide theft of funds.

This crime is most commonly committed by an employee in a corporate setting; a person is given access to someone else’s property or money for the purposes of managing, monitoring, and/or using the assets for the owner’s best interests, but then covertly misappropriating the assets for his/her own personal gain and use.

Past cases include bank tellers taking advantage of regular, lawful business transactions to redirect funds for their own gain. Others include employees who were given lawful possession of property such as laptop computers, company vehicles, real estate, securities, etc.

Some embezzlers simply took a large amount of money at once, while others misappropriated small amounts over a long period of time. The methods varied greatly and were often creative. They included fraudulent billing, payroll checks to fabricated employees, records falsification, “Ponzi” financial schemes, and more.

“[FA Matters] willingly and very capably took on some of the most challenging assignments, under tight deadlines, and in difficult places.” – *

Kickbacks are one of the most common forms of government corruption. In some cases, the kickback took the form of a “cut of the action,” and were so well known as to become common knowledge—and even part of a nation’s culture. For example, in Indonesia, a President  was publicly known as “Mr. Twenty-Five Percent” because he required that all major contracts throughout the nation provide him with 25 percent of the income before he would approve the contract.

Some kickbacks differed from other forms of corruption, such as diversion of assets, as in embezzlement  because of the collusion between the two parties.

The kickback schemes were pervasive. For example, the most common form of kickback involved a vendor submitting a fraudulent or inflated invoice (for goods or services which were not needed, of inferior quality, or both), with an employee of the victim company assisting in securing payment. For his or her assistance in securing payment, the individual received  payment (cash, goods, services) or favor.

“[FA Matters] knowledge of financial documentation and audit experience was instrumental in our investigation.” – *

Money laundering happens in almost every country in the world, and a single scheme typically involves transferring money through several countries using offshore accounts in order to obscure its origins.

Money laundering, at its simplest, is the act of making money that comes from Source A look like it comes from Source B. In practice, criminals disguise the origins of money obtained through illegal activities so it looks like it was obtained from legal sources. Otherwise, they can’t use the money because it would connect them to the criminal activity, and subject the funds to seizure. The most common types of criminals who were found to launder money were drug traffickers, embezzlers, corrupt politicians, public officials, terrorists, operatives, and con artists.

“[FA Matters audits were] characterized as thorough, accurate, and comprehensive.” – *

Assistance and information from a whistleblower who knows of possible legal violations can be among the most powerful weapons in the law enforcement arsenal and forensic accountants. Through their knowledge of circumstances and individuals involved, whistleblowers help identify possible fraud and other violations much earlier than might otherwise be possible. This allows the ability to minimize the harm to investors, better preserve the integrity of the United States’ capital markets, and more swiftly hold accountable those responsible for unlawful conduct.

*Disclaimer: Please note that all individuals must remain anonymous to protect confidential information.
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