Life in the forensic accounting fast lane

Forensic accountants find the smoking guns in financial reports and statements. Sometimes they get you your money back! Sometimes the evildoers get indicted!! Sometimes not…

The following is correspondence from Deep Audit, a forensic accountant who has been researching some stuff for me.

“Ouch! For what you’re going through. I’d be lying on the floor with a migraine … or at least my left eyelid would be jumping … possibly the entire left side of my body.

Money is a tool. It isn’t an evil (as some on the left would have it) or a gift from God (as many on the right believe) … it is just a tool. A very powerful tool, as evil or good as the people who use it. I see endless crime for bucks. Forget murder mysteries — people screw each other at a fantastic speed for money.

Occasionally I like to think that there are good people out there, upholding truth, justice, and the golden rule (love thy neighbor as thyself) … but then another fraud file drops onto my desk … or I hear a story like yours. Yeek.

Case in point is a case I once worked on: Public Company, under the control of Richie T. Bastard, III, pulls a fast one. The auditors — I’ll give you one guess as to who they are — sign off on the twisted transaction’s justification in the financial statements.

Our client, Largest Minority Shareholder, sues Bastard. We do our things — A letter is drafted detailing the financial statements’ ills: (1) This is wrong, (2) That is wrong, (3) This other thing is bogus, and so forth…. The implication throughout: you,  sir, are busted. You’re going to jail for SO long, that when you get out, the nursing home ambulance will be there to pick you up at the gate.

But the letter never goes to the authorities. Bastard settles with Largest Minority Shareholder for a very large sum. Not a bad day’s work for a beancounter (except that at beancounter wages, I will not earn such a very large sum in my lifetime). That’s the good news. The bad news? None of the other shareholders know. I’m sure there are widows and orphans and regular joes among them. I can’t tell them, of course.

Someday it’s all going to fall apart and I hope it’s while Bastard still lives and has liquid assets.

I guess all we can do is keep ourselves straight and clean to the best of our abilities.  Hard enough, isn’t it?  But I still think USC needs to transfer that statue of Diogenes from the Philosophy building to the B-school.”

Indeed. Forensic accountants find those clean hard irrefutable facts that give a case clarity. As Private Investigator Jan Tucker says  - this stuff sometimes seems messy and political and complicated. But if you take money that doesn’t belong to you, that’s illegal in every country on the planet. And that’s not complicated at all.

No Comments »

Smart mobs and antiwar protests

Smart Mobs is a book and website by Howard Rheingold. It’s about how technology allows fast, distributed organizing with no apparent leaders. Sounds like the peace movement, eh?

Rheingold explains the theory:

“Smart mobs emerge when communication and computing technologies amplify human talents for cooperation. The impacts of smart mob technology already appear to be both beneficial and destructive, used by some of its earliest adopters to support democracy and by others to coordinate terrorist attacks. The technologies that are beginning to make smart mobs possible are mobile communication devices and pervasive computing - inexpensive microprocessors embedded in everyday objects and environments. Already, governments have fallen, youth subcultures have blossomed from Asia to Scandinavia, new industries have been born and older industries have launched furious counterattacks.

Street demonstrators in the 1999 anti-WTO protests used dynamically updated websites, cell-phones, and “swarming” tactics in the “battle of Seattle.” A million Filipinos toppled President Estrada through public demonstrations organized through salvos of text messages.”

He sees the massive worldwide protests last weekend as a perfect example of Smart Mobs

“The New York Times reports on the use of the Internet and mobile communications by organizers and participants in worldwide protests against the Bush administrations war plans.

The protests had no single identified leader and no central headquarters. Social theorists have a name for these types of decentralized networks: heterarchies. In contrast to hierarchies, with top-down structures, heterarchies are made up of previously isolated groups that can connect to one another.

One huge advantage that heterarchies and decentralized networks have is that hierarchies don’t understand them. They keep looking for a head to chop off as the best way to stop them, not understanding that there is no head. It’s like the Internet, there is no central source, any node can talk to any node.

Weblogs, like this one, are another example. Information flows very fast through blogs, getting filtered, added onto, tweaked, as it speeds its way through cyberspace. Geographical location or time zone becomes irrelevant. Wheee.

No Comments »

Pssst, the war HAS started

“US and Britain pound Iraqi defences in massive escalation of airstrikes.

Iraq has been ordered to destroy dozens of missiles which violate UN limits, but the US and Britain are not waiting to see whether Saddam Hussein complies.

In recent days, an Independent on Sunday investigation reveals, they have stepped up attacks on missile sites near Basra which could threaten the military build-up in Kuwait and the Gulf.”

No Comments »

L.A. alert

When the war starts “officially” (yes, I said when, not if), assemble at the Westwood Federal Building at 5 pm if a weekday or noon if a weekend.

That’s the basic plan. However I suspect there will be massive spontaneous demos everywhere.

No Comments »

Crash bonsai

No Comments »