Accounting scandals explained

Accounting scandals are business scandals which arise from intentional manipulation of financial statements with the disclosure of financial misdeeds by trusted executives of corporations or governments. Such misdeeds typically involve complex methods for misusing or misdirecting funds, overstating revenues, understating expenses, overstating^[1] the value of corporate assets, or underreporting the existence of liabilities; these can be detected either manually, or by the means of deep learning.^[2] It involves an employee, account, or corporation itself and is misleading to investors and shareholders.^[3]

This type of "creative accounting" can amount to fraud, and investigations are typically launched by government oversight agencies, such as the Securities and Exchange Commission (SEC) in the United States. Employees who commit accounting fraud at the request of their employers are subject to personal criminal prosecution.^[4]

Two types of fraud

Misappropriation of assets

Misappropriation of assets – often called defalcation or employee fraud – occurs when an employee steals a company's asset, whether those assets are of monetary or physical nature. Typically, assets stolen are cash, or cash equivalents, and company data or intellectual property.^[5] However, misappropriation of assets also includes taking inventory out of a facility or using company assets for personal purpose without authorization. Company assets include everything from office supplies and inventory to intellectual property.

Fraudulent financial reporting

Fraudulent financial reporting is also known as earnings management fraud. In this context, management intentionally manipulates accounting policies or accounting estimates to improve financial statements. Public and private corporations commit fraudulent financial reporting to secure investor interest or obtain bank approvals for financing, as justifications for bonuses or increased salaries or to meet the expectations of shareholders.^[6] The U.S. Securities and Exchange Commission has brought enforcement actions against corporations for many types of fraudulent financial reporting, including improper revenue recognition, period-end stuffing, fraudulent post-closing entries, improper asset valuations, and misleading non-GAAP financial measures.^[7]

The fraud triangle

The fraud triangle is a model for explaining the factors that cause someone to commit fraudulent behaviors in accounting. It consists of three components, which together, lead to fraudulent behavior:

• Incentives/pressure: Management or other employees have incentives or pressures to commit fraud.
• Opportunities: Circumstances provide opportunities for management or employees to commit fraud.
• Attitudes/rationalization: An attitude, character, or set of ethical values exists that allows management or employees to commit a dishonest act, or they are in an environment that imposes sufficient pressure that causes them to rationalize committing a dishonest act.^[8]

Incentives/pressures: A common incentive for companies to manipulate financial statement is a decline in the company's financial prospects. Companies may also manipulate earnings to meet analysts' forecasts or benchmarks such as prior-year earnings, to meet debt covenant restrictions, achieve a bonus target based on earnings, or artificially inflate stock prices. As for misappropriation of assets, financial pressures are a common incentive for employees. Employees with excessive financial obligations, or those with substance abuse or gambling problems may steal to meet their personal needs.^[9]

Opportunities: Although the financial statements of all companies are potentially subject to manipulation, the risk is greater for companies in industries where significant judgments and accounting estimates are involved. Turnover in accounting personnel or other deficiencies in accounting and information processes can create an opportunity for misstatement. As for misappropriation of assets, opportunities are greater in companies with accessible cash or with inventory or other valuable assets, especially if the assets are small or easily removed. A lack of controls over payments to vendors or payroll systems can allow employees to create fictitious vendors or employees and bill the company for services or time.^[10]

Attitudes/rationalization: The attitude of top management toward financial reporting is a critical risk factor in assessing the likelihood of fraudulent financial statements. If the CEO or other top managers display a significant disregard for the financial reporting process, such as consistently issuing overly optimistic forecasts, or they are overly concerned about the meeting analysts' earnings forecast, fraudulent financial reporting is more likely. Similarly, for misappropriation of assets, if management cheats customers through overcharging for goods or engaging in high-pressure sales tactics, employees may feel that it is acceptable for them to behave in the same fashion.^[11]

Causes

Fraud is done by people. There are three ways to unlawfully take another person’s money: force, trickery, and stealth.^[12] Frauds such as embezzlement are easy to hide when company records are opaque to begin with. Poor accounting, such as the absence of monthly reconciliations or an independent audit function, also indicate vulnerability to fraud.^[13]

Executive and managerial motivations for fraud

An executive can easily reduce the price of his company's stock due to information asymmetry. He can: accelerate accounting of expenses, delay accounting of revenue, engage in off balance sheet transactions to make the company seem less profitable, or simply report very low estimates of future earnings. Executives may do this to make a company a more attractive takeover target. When the company is bought for less, the acquirer profits from the executive's actions to surreptitiously reduce share price. This can represent tens of billions of dollars (questionably) transferred from former shareholders to the acquirer. The executive is then rewarded with a golden handshake for presiding over the firesale that can sometimes be in the hundreds of millions of dollars for one or two years of work.^[14] Managerial opportunism plays a large role in these scandals.

Similar issues occur when a publicly held asset or non-profit organization undergoes privatization. Executives often profit greatly. Again, they can help by making the organization appear to be in financial crisis. This lowers the sale price, and makes non-profits and governments more likely to sell. It can also contribute to a public perception that private entities are more efficiently run, thereby reinforcing the political will to sell off public assets. Again, due to asymmetric information, policy makers and the general public see a government-owned firm that was a financial 'disaster' miraculously turned around by the private sector (and typically resold) within a few years. Under the Special Plea in Fraud statute, "the government must 'establish by clear and convincing evidence that the contractor knew that its submitted claims were false, and that it intended to defraud the government by submitting those claims.'" Mere negligence, inconsistency, or discrepancies are not actionable under the Special Plea in Fraud statute.^[15]

Employee motivations for fraud

Not all accounting scandals are caused by those at the top. In fact, in 2015, 33% of all business bankruptcies were caused by employee theft.^[16] Often middle managers and employees are pressured to or willingly alter financial statements due to their debts or the possibility of personal benefit over that of the company, respectively. For example, officers who would be compensated more in the short-term (for example, cash in pocket) might be more likely to report inaccurate information on a tab or invoice (enriching the company and maybe eventually getting a raise).^[17]

List of biggest accounting scandals

Company	Year	Audit firm	Country	Notes
	Fred Stern & Company	1925	Touche, Niven & Co.	United States	Trial: Ultramares Corp. v. Touche
	Hatry Group	1929		United Kingdom
	Royal Mail Steam Packet Company	1931	Harold John Morland	United Kingdom	Misrepresented drawdowns from reserves as trading profits. Trial: Royal Mail Case (R v Kylsant & Otrs)
	Interstate Hosiery Mills	1937	Homes and Davis	United States
McKesson and Robbins scandal	1938	Price, Waterhouse & Co.	United States
	Yale Express System	1965^[18]	Peat, Marwick, Mitchell & Co.	United States	Overstated net worth and failed to indicate net operating loss
	Atlantic Acceptance Corporation	1965^[19]	Wagman, Fruitman & Lando	Canada	CPA conflicts of interest
	Continental Vending Machine Corp.	1969^[20]	Lybrand, Ross Brothers, & Montgomery	United States	CPA partners convicted and fined
	National Student Marketing Corporation	1970^[21]	Peat, Marwick, Mitchell & Co.	United States	Overstatement of earnings
	Four Seasons Nursing Centers of America	1970^[22]	Arthur Andersen	United States	Overstatement of earnings; CPA partners indicted
	Equity Funding	1973^[23]	Wolfson Weiner; Ratoff & Lapin	United States	Created fictitious insurance policies
	Fund of Funds – Investors Overseas Services	1973^[24]	Arthur Andersen	Canada	Mutual fund that inflated value of assets
	Lockheed Corporation	1976^[25]		United States
	Nugan Hand Bank	1980^[26]		Australia
	O.P.M. Leasing Services	1981^[27]	Fox & Company	United States	Created fictitious leases
	ZZZZ Best	1986^[28]		United States	Ponzi scheme run by Barry Minkow
	Northguard Acceptance Ltd.	1980 to 1982^[29]		Canada
	ESM Government Securities	1986^[30]	Alexander Grant & Company	United States	Bribery of CPA partner.
	Bankers Trust	1988^[31]	Arthur Young & Co	United States	Hid an $80 million mis-pricing of derivatives contributing to profits by cutting bonuses.
	Barlow Clowes	1988^[32]		United Kingdom	Gilts management service. £110 million missing
	Crazy Eddie	1989^[33]		United States
	MiniScribe	1989^[34]		United States
	Livent	1989 to 1998	Deloitte & Touche^[35] ^[36]	Canada	Fraud and forgery
	Polly Peck	1990^[37]		United Kingdom
	Bank of Credit and Commerce International	1991^[38]		United Kingdom
	Phar-Mor	1992^[39]	Coopers & Lybrand	United States	Mail fraud, wire fraud, bank fraud, and transportation of funds obtained by theft or fraud
		1992^[40] ^[41] ^[42] ^[43]			Fraud, market manipulation, money laundering
	Informix Corporation	1996^[44]	Ernst & Young^[45]	United States
	Sybase	1997^[46] ^[47] ^[48]	Ernst & Young^[49]	United States
	Cendant	1998^[50]	Ernst & Young	United States
	Cinar	1998^[51]	Ernst & Young	Canada	Misuse of corporate funds
	Waste Management, Inc.	1999^[52]	Arthur Andersen	United States	Financial misstatements
	MicroStrategy	2000^[53]	PWC	United States	Michael Saylor
	Unify Corporation	2000^[54]	Deloitte & Touche	United States
	Computer Associates	2000^[55]	KPMG	United States	Sanjay Kumar, Stephen Richards
	Lernout & Hauspie	2000	KPMG	Belgium	Fictitious transactions in Korea and improper accounting methodologies elsewhere
	Xerox	2000^[56]	KPMG	United States	Falsifying financial results
	One.Tel	2001^[57]	Ernst & Young	Australia
	Enron	2001^[58]	Arthur Andersen	United States	Jeffrey Skilling, Kenneth Lay, Andrew Fastow
	Swissair	2001	PricewaterhouseCoopers	Switzerland
	Adelphia	2002^[59]	Deloitte & Touche	United States	John Rigas
	AOL	2002	Ernst & Young	United States	Inflated sales
	Bristol-Myers Squibb	2002^[60]	PricewaterhouseCoopers	United States	Inflated revenues
	CMS Energy	2002^[61]	Arthur Andersen	United States	Round trip trades
	Duke Energy	2002	Deloitte & Touche	United States	Round trip trades
	Vivendi Universal	2002	Arthur Andersen	France	Financial reshuffling
	Dynegy	2002	Arthur Andersen	United States	Round trip trades
	El Paso Corporation	2002	Deloitte & Touche	United States	Round trip trades
	Freddie Mac	2002^[62]	PricewaterhouseCoopers	United States	Understated earnings
	Global Crossing	2002	Arthur Andersen	Bermuda	Network capacity swaps to inflate revenues
	Halliburton	2002	Arthur Andersen	United States	Improper booking of cost overruns
	Homestore.com	2002^[63]	PricewaterhouseCoopers	United States	Improper booking of sales
	ImClone Systems	2002^[64]	KPMG	United States	Samuel D. Waksal
	Kmart	2002^[65]	PricewaterhouseCoopers	United States	Misleading accounting practices
	Merck & Co.	2002	PricewaterhouseCoopers	United States	Recorded co-payments that were not collected
	Merrill Lynch	2002^[66]	Deloitte & Touche	United States	Conflict of interest
	Mirant	2002	KPMG	United States	Overstated assets and liabilities
	Nicor	2002	Arthur Andersen	United States	Overstated assets, understated liabilities
	Peregrine Systems	2002	Arthur Andersen	United States	Overstated sales
	Qwest Communications	2002	Arthur Andersen (1999, 2000, 2001)KPMG (2002 October)	United States	Inflated revenues
	Reliant Energy	2002	Deloitte & Touche	United States	Round trip trades
	Sunbeam	2002^[67]	Arthur Andersen	United States	Overstated sales and revenues
	Symbol Technologies	2002^[68] ^[69]		United States
	Steinhoff International	2002		United States	Overstated sales and revenues
	Tyco International	2002	PricewaterhouseCoopers	Bermuda	Improper accounting, Dennis Kozlowski
	WorldCom	2002^[70]	Arthur Andersen	United States	Fraudulent expense capitalization, Bernard Ebbers
	Royal Ahold	2003^[71]	Deloitte & Touche	United States	Inflating promotional allowances
	Parmalat	2003^[72] ^[73]	Grant Thornton SpA	Italy	Falsified accounting documents, Calisto Tanzi
	HealthSouth Corporation	2003^[74]	Ernst & Young	United States	Richard M. Scrushy
	Nortel	2003^[75]	Deloitte & Touche	Canada	Distributed ill-advised corporate bonuses to top 43 managers
	Chiquita Brands International	2004^[76]	Ernst & Young	United States	Illegal payments
	AIG	2004^[77]	PricewaterhouseCoopers	United States	Accounting of structured financial deals
	Bernard L. Madoff Investment Securities LLC	2008^[78]	Friehling & Horowitz	United States	Biggest Ponzi scheme in history^[79]
	Anglo Irish Bank	2008^[80]	Ernst & Young	Ireland	Anglo Irish Bank hidden loans controversy
	Satyam Computer Services	2009^[81]	PricewaterhouseCoopers	India	Falsified accounts
	Biovail	2009^[82]		Canada	False statements
	Taylor, Bean & Whitaker	2009^[83]	PricewaterhouseCoopers	United States	Fraudulent spending
	Monsanto	2009 to 2011^[84]	Deloitte	United States	Improper accounting for incentive rebates
	Kinross Gold	2010^[85]	KPMG	Canada	Overstated asset values
	Lehman Brothers	2010^[86]	Ernst & Young	United States	Failure to disclose Repo 105 misclassified transactions to investors
		2010^[87] ^[88] ^[89]		India	Fraud and Market manipulation
	Amir-Mansour Aria	2011	IAO (audit organization) and other audit firms		Business loans without putting any collateral and financial system
	Bank Saderat Iran	2011	IAO (audit organization) and other audit firms		Financial transactions among banks and getting a lot of business loans without putting any collateral
	Sino-Forest Corporation	2011^[90]	Ernst & Young	Canada-China	Ponzi scheme, falsifying assets
	Olympus Corporation	2011^[91]	Ernst & Young	Japan	Tobashi using acquisitions
	Autonomy Corporation	2012^[92]	Deloitte & Touche	United States	Subsidiary of HP
	Penn West Exploration	2012 to 2014^[93]	KPMG	Canada	Overstated profits
	Pescanova	2013	BDO Spain	Spain	Understated debt, fraudulent invoices, falsified accounts
	Petrobras	2014^[94]	PricewaterhouseCoopers	Brazil	Government bribes, misappropriation, money laundering
	Tesco	2014^[95]	PricewaterhouseCoopers	United Kingdom	Revenue recognition
	Toshiba	2015^[96]	Ernst & Young	Japan	Overstated profits
	Valeant Pharmaceuticals	2015^[97]	PricewaterhouseCoopers	Canada	Overstated revenues
	Alberta Motor Association	2016^[98] ^[99]		Canada	Fraudulent invoices
	Odebrecht	2016^[100]		Brazil	Government bribes
	Wells Fargo	2017^[101]	KPMG	United States	False accounting
	1Malaysia Development Berhad	2018	Ernst & Young, Deloitte, KPMG^[102]	Malaysia	Fraud, money laundering, abuse of political power, government bribes
	Wirecard	2020^[103]	Ernst & Young	Germany	Allegations of fraud
	Luckin Coffee	2020	Ernst & Young	China	Inflated its 2019 sales revenue by up to US$310 million
	Adani Group	2023^[104] ^[105] ^[106]	Shah Dhandharia		Allegations of accounting fraud, stock manipulation, money laundering
	Americanas	2023	KPMG and PWC	Brazil	Accounting inconsistencies related to forfait in the order of R$ 20 billion
	Evergrande	2023	PWC	China	Revenue overstatement in the order of $78 billion from 2019-2020 leading to the Evergrande liquidity crisis
	BF Borgers	2024		United States	^[107]

Notable outcomes

The Enron scandal turned into the indictment and criminal conviction of Big Five auditor Arthur Andersen on June 15, 2002. Although the conviction was overturned on May 31, 2005, by the Supreme Court of the United States, the firm ceased performing audits and split into multiple entities. The Enron scandal was defined as being one of the biggest audit failures of all time. The scandal included utilizing loopholes that were found within the GAAP (General Accepted Accounting Principles). For auditing a large-sized company such as Enron, the auditors were criticized for having brief meetings a few times a year that covered large amounts of material. By January 17, 2002, Enron decided to discontinue its business with Arthur Andersen, claiming they had failed in accounting advice and related documents. Arthur Andersen was judged guilty of obstruction of justice for disposing of many emails and documents that were related to auditing Enron. Since the SEC is not allowed to accept audits from convicted felons, the firm was forced to give up its CPA licenses later in 2002, costing over 113,000 employees their jobs. Although the ruling was later overturned by the U.S. Supreme Court, the once-proud firm's image was tarnished beyond repair, and it has not returned as a viable business even on a limited scale.

On July 9, 2002, George W. Bush gave a speech about recent accounting scandals that had been uncovered. In spite of its stern tone, the speech did not focus on establishing new policy, but instead focused on actually enforcing current laws, which include holding CEOs and directors personally responsible for accountancy fraud.^[108]

In July 2002, WorldCom filed for bankruptcy protection in what was considered at the time as the largest corporate insolvency ever.^[109] A month earlier, the company's internal auditors discovered over $3.8 billion in illicit accounting entries intended to mask WorldCom's dwindling earnings, which was by itself more than the accounting fraud uncovered at Enron less than a year earlier.^[110] Ultimately, WorldCom admitted to inflating its assets by $11 billion.^[111]

These scandals reignited the debate over the relative merits of US GAAP, which takes a "rules-based" approach to accounting, versus International Accounting Standards and UK GAAP, which takes a "principles-based" approach.^{[112] [113]} The Financial Accounting Standards Board announced that it intends to introduce more principles-based standards. More radical means of accounting reform have been proposed, but so far have very little support. The debate itself overlooks the difficulties of classifying any system of knowledge, including accounting, as rules-based or principles-based. This also led to the establishment of the Sarbanes-Oxley Act. On a lighter note, the 2002 Ig Nobel Prize in Economics went to the CEOs of those companies involved in the corporate accounting scandals of that year for "adapting the mathematical concept of imaginary numbers for use in the business world."

In 2003, Nortel made a big contribution to this list of scandals by incorrectly reporting a one cent per share earnings directly after their massive layoff period. They used this money to pay the top 43 managers of the company. The SEC and the Ontario securities commission eventually settled civil action with Nortel. A separate civil action was taken up against top Nortel executives including former CEO Frank A. Dunn, Douglas C. Beatty, Michael J. Gollogly, and MaryAnne E. Pahapill and Hamilton. These proceedings were postponed pending criminal proceedings in Canada, which opened in Toronto on January 12, 2012.^[114] Crown lawyers at this fraud trial of three former Nortel Networks executives say the men defrauded the shareholders of Nortel of more than $5 million. According to the prosecutor this was accomplished by engineering a financial loss in 2002, and a profit in 2003 thereby triggering Return to Profit bonuses of $70 million for top executives.^{[115] [116] [117] [118] [119]} In 2007, Dunn, Beatty, Gollogly, Pahapill, Hamilton, Craig A. Johnson, James B. Kinney, and Kenneth R.W. Taylor were charged with engaging in accounting fraud by "manipulating reserves to manage Nortel's earnings."^[120]

In 2005, after a scandal on insurance and mutual funds the year before, AIG was investigated for accounting fraud. The company already lost over $45 billion worth of market capitalization because of the scandal. Investigations also discovered over a $1 billion worth of errors in accounting transactions. The New York Attorney General's investigation led to a $1.6 billion fine for AIG and criminal charges for some of its executives.^[121] CEO Maurice R. "Hank" Greenberg was forced to step down and fought fraud charges until 2017, when the 91-year-old reached a $9.9 million settlement.^{[122] [123]} Howard Smith, AIG's chief financial officer, also reached a settlement.

Well before Bernard Madoff's massive Ponzi scheme came to light, observers doubted whether his listed accounting firm – an unknown two-person firm in a rural area north of New York City – was competent to service a multibillion-dollar operation, especially since it had only one active accountant, David G. Friehling.^[124] Friehling's practice was so small that for years he operated out of his house; he only moved into an office when Madoff customers wanted to know more about who was auditing his accounts.^[125] Ultimately, Friehling admitted to simply rubber-stamping at least 18 years' worth of Madoff's filings with the SEC. He also revealed that he continued to audit Madoff even though he had invested a substantial amount of money with him; accountants are not allowed to audit broker-dealers with whom they are investing. He agreed to forfeit $3.18 million in accounting fees and withdrawals from his account with Madoff. His involvement makes the Madoff scheme not only the largest Ponzi scheme ever uncovered, but the largest accounting fraud in world history.^[126] The $64.8 billion claimed to be in Madoff accounts dwarfed the $11 billion fraud at WorldCom.

See also

• Accounting ethics
• Corporate crime
• Creative accounting
• Dot-com bubble
• Financial crisis of 2007–2008
• Forensic accounting
• Hollywood accounting
• List of corporate collapses and scandals
• Microcap stock fraud
• Philosophy of accounting
• Repo 105
• Sarbanes–Oxley Act
• Savings and loan crisis
• Securities fraud
• Tobashi scheme
• Vivien v. WorldCom
• White-collar crime

Further reading

• John R. Emshwiller and Rebecca Smith, 24 Days: How Two Wall Street Journal Reporters Uncovered the Lies that Destroyed Faith in Corporate America or Infectious Greed, HarperInformation, 2003,
• Lawrence A. Cunningham, The Sarbanes-Oxley Yawn: Heavy Rhetoric, Light Reform (And It Might Just Work)
• Zabihollah Rezaee, Financial Statement Fraud: Prevention and Detection, Wiley 2002.

External links

• U.S. Securities and Exchange Commission website
• U.S. President Bush's speech, 2002-07-09 NPR report (audio recording)
• "GMI Warns of Accounting Risks at 40 Companies", Accounting Today, November 27, 2012
• "The Impact of Fraud on Shareholder Value", Business Insider, June 18, 2013

Notes and References

1. In Italian law the phrase "still subject to evaluation" now refers to material facts that are untrue: it was a clarification for "informations", but totally inconsistent with the "facts" reported in accounting documents: Buonomo . Giampiero . 2001 . Diritto societario: chiusa la discussione, approvazione a fine mese . live . Diritto&Giustizia Edizione Online . https://web.archive.org/web/20160324160801/https://www.questia.com/projects#!/project/89309129 . March 24, 2016 . mdy-all.
2. 1910.03810 . cs.LG . Marco . Schreyer . Adversarial Learning of Deepfakes in Accounting . October 9, 2019.
3. News: Nickolas . Steven . March 27, 2015 . What is accounting fraud? . en-US . Investopedia . live . March 19, 2017 . https://web.archive.org/web/20170320145307/http://www.investopedia.com/ask/answers/032715/what-accounting-fraud.asp . March 20, 2017 . mdy-all.
4. Web site: What is accounting fraud? definition and meaning . live . https://web.archive.org/web/20170320144730/http://www.businessdictionary.com/definition/accounting-fraud.html . March 20, 2017 . March 19, 2017 . BusinessDictionary.com . en . mdy-all.
5. News: January 25, 2010 . Asset misappropriation fraud . en . Action Fraud . live . March 19, 2017 . https://web.archive.org/web/20170320143735/http://www.actionfraud.police.uk/fraud_protection/asset_misappropriation . March 20, 2017 . mdy-all.
6. News: What Is Financial Statement Fraud? . en . live . March 20, 2017 . https://web.archive.org/web/20170320233602/http://smallbusiness.chron.com/financial-statement-fraud-57182.html . March 20, 2017 . mdy-all.
7. Web site: When do non-GAAP metrics become fraudulent publicity? . January 9, 2019 . Fraud Magazine.
8. Book: Alvin, Aren . Auditing and Assurance Services . Pearson . 2016 . 978-0134065823 . 299.
9. Book: Aren, Alvin . Auditing and Assurance Services . Pearson . 2016 . 978-0134065823 . New York . 300.
10. Book: Aren, Alvin . Auditing and Assurance Services . Pearson . 2016 . 978-0134065823 . New York . 301.
11. Book: Aren, Alvin . Auditing and Assurance Services . Pearson . 2016 . 978-0134065823 . New York . 302.
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14. News: January 11, 2012 . Challenging times for crisis-hit Cosalt . en . Grimsby Telegraph . April 9, 2017.
15. Horan, Jack. "Fraud is here, Fraud is there, but is Fraud Everywhere?" Contract Management 01 2016: 64,65,67-69. ProQuest. Web. Jan. 31, 2018 .
16. Web site: June 2, 2016 . 25 Jaw Dropping Statistics about Employee Fraud in 2015 . May 7, 2020 . SheerID . en-US.
17. Cunningham . Lawrence . September 12, 2003 . The Appeal and Limits of Internal Controls to Fight Fraud, Terrorism, Other Ills . 18.
18. John Z. Szabo, Licenses—Accountants' Liability—Duty to Disclose [Fisher v. Kletz, 266 F. Supp. 180 (S.D.N.Y. 1967)], 19 Case Western Reserve Law Review p387 (1968)Web site: Archived copy . live . https://web.archive.org/web/20171107010310/http://scholarlycommons.law.case.edu/cgi/viewcontent.cgi?article=4601&context=caselrev . November 7, 2017 . November 6, 2017 . mdy-all.
19. News: M. J. Rossant . November 14, 1965 . Atlantic Acceptance: Even the Big Ones Got Stung; U.S. Investors Lose Heavily Following Collapse of Canada's Atlantic Acceptance . The New York Times . live . https://web.archive.org/web/20171107031412/https://www.nytimes.com/1965/11/14/archives/atlantic-acceptance-even-the-big-ones-got-stung-us-investors-lose.html . November 7, 2017 . mdy-all.
20. The Accounting Cycle: NY v. Ernst & Young: Who Cares Whether Lehman Brothers Followed GAAP? accounting.smartpros.com January 2011 Web site: NY v. Ernst & Young: Who Cares Whether Lehman Brothers Followed GAAP? . live . https://web.archive.org/web/20171107003011/http://accounting.smartpros.com/x71245.xml . November 7, 2017 . November 6, 2017 . mdy-all.
21. News: Labaton . Stephen . December 7, 1986 . Cortes Randell: Student Market Hoax . The New York Times . live . https://web.archive.org/web/20161009194949/http://www.nytimes.com/1986/12/07/business/archives-of-business-a-rogues-gallery-cortes-randell-student-market-hoax.html . October 9, 2016 . mdy-all.
22. https://www.nytimes.com/1972/12/21/archives/us-indicts-eight-in-sale-of-stock-in-nursing-homes-200million-fraud.html U.S. Indicts Eight In Sale Of Stock In Nursing Homes
23. Insurance Fraud Charged By S.E.C. To Equity Funding The New York Times April 4, 1973 News: Insurance Fraud Charged by S.e.c. To Equity Funding . . April 4, 1973 . live . https://web.archive.org/web/20171107114639/http://www.nytimes.com/1973/04/04/archives/insurance-fraud-charged-by-sec-to-equity-funding-difficulties-were.html . November 7, 2017 . February 7, 2017 . mdy-all. Cole . Robert J. .
24. Anderson Firm Is Found Guilty of Fraud The New York Times November 5, 1981 News: Anderson Firm is Found Guilty of Fraud . . November 5, 1981 . live . https://web.archive.org/web/20171107043105/http://www.nytimes.com/1981/11/05/business/anderson-firm-is-found-guilty-of-fraud.html . November 7, 2017 . December 28, 2017 . mdy-all. Arenson . Karen W. .
25. August 18, 1975 . Scandals: Lockheed's Defiance: A Right to Bribe? . . live . July 3, 2016 . https://web.archive.org/web/20160829122011/http://content.time.com/time/magazine/article/0,9171,917751-1,00.html . August 29, 2016 . mdy-all.
26. Owen, J. Sleight of Hand : The $25 million Nugan Hand Bank Scandal; Balmain, Sydney, Australia: Colporteur Press, 1983.
27. A Close-Up Look at the Fraud That Ruined O.P.M. The New York Times May 1, 1983 News: A Close-Up Look at the Fraud That Ruined O.p.m. . The New York Times. May 1983 . live . https://web.archive.org/web/20161222084431/http://www.nytimes.com/1983/05/01/business/a-close-up-look-at-the-fraud-that-ruined-opm.html?pagewanted=all . December 22, 2016 . February 11, 2017 . mdy-all. Taylor . Stuart Jr. .
28. Minkow, Barry, Clean Sweep:The Inside Story of the Zzzz Best Scam ... One of Wall Street's Biggest Frauds,
29. Hercules Managements Ltd. v. Ernst & Young, [1997] 2 S.C.R. 165 Web site: Hercules Managements LTD. V. Ernst & Young - SCC Cases (Lexum) . dead . https://web.archive.org/web/20141111201059/http://scc-csc.lexum.com/scc-csc/scc-csc/en/item/1511/index.do . November 11, 2014 . November 11, 2014 . mdy.
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