Microsoft “Vista” accused of being illegal in Europe


Microsoft’s competitors in Europe alleged today that the new Vista operating system continues the illegal practices by Microsoft discovered in Europe 3 years ago. The group complaining includes IBM, Nokia, Sun Microsystems, Adobe, Oracle, and Red Hat.

In 2004, the European Commission determined that Microsoft purposely made Windows software incompatible with competitors’ server software, as well as trying to get makers of audio and video streaming software out of the market.

Microsoft was set to release Vista on Tuesday, but the European Commission said Vista is aimed at increasing Microsoft’s dominance. The company is pushing its XAML markup language so that it may replace HTML, the current standard for publishing on the Internet. Microsoft is also using OOXML (open XML) on the Microsoft Office platform. This dictates how a document is formatted and stored, and competitors are also claiming that Microsoft is using this to increase its monopoly.

Security software makers have complained that Microsoft is denying them access to Vista, which they need to help create their products to protect computers from malicious viruses and software.

Chicago Board of Elections distributes social security numbers


The Chicago Board of Elections distributed computer discs to aldermanic campaigns in 2003 which contained the Social Security numbers of more than a million voters. The voter information on the discs also included names, addresses, and birthdates.

Since this inceident, more discs containing Social Secuirty information have been distributed. Officials said that there was no evidence of identity theft from the incidents, but the Board of Elections will notify voters that their data has been compromised.

Voter records have now been changed to only include the last four digits of Social Security numbers.

Former Prisoner of Nazis Was an Expert in Counterfeiting


A story in the Wall Street Journal tells how an 89-year-old survivor of Nazi concentration camps stayed alive because of his ability to counterfeit money. Adolf Burger and 140 other prisoners forged so much British currency, that 12% of all pound-sterling bills in 1945 were fake.

The goal at the time was to break the trust in British currency, and ultimately damage the country’s economy. However, the quest was unsuccessful as German agents skimmed millions of dollars off the counterfeiting oper Continue reading

Hewlett-Packard investigator charged with identity theft


Bryan Wagner, the investigator contracted by Hewlett-Packard to help find the source of information leaks, has been charged in federal court with crimes of aggravated [tag]identity theft[/tag] and [tag]conspiracy[/tag]. The conspiracy charge carries a maximum penalty of 5 years in prison and a $250,000 fine. The identity theft carries a penalty of up to 2 years in prison and a $250,000 fine.

While working for Action Search Group, Wagner is alleged to have obtained the names, addresses, Social Security numbers, telephone call logs, and telephone records of the HP board members and reporters. He is further accused of using a reporter’s Social Security number to create an online account to get the reporter’s telephone records.

In November, the former CEO of HP, Patricia Dunn, was charged in state court with four felonies related to the spying scandal. She has pleaded not guilty to charges of: using false or fraudulent pretenses to obtain confidential information from a public utility, wrongful use of computer data, identity theft, and conspiracy to commit each of those crimes.

The charges stem from her alleged orders to have an investigator identify the board members who may have leaked information from their private meetings to the press. Also charged with the same crimes are Kevin Hunsaker, a former senior lawyer for HP, Ronald DeLia, a private detective, and Bryan Wagner.

New accounting standard issued


Announced by the AICPA (American Institute of CPAs):

ASB Issues SAS No. 114, The Auditor’s Communication with Those Charged with Governance

The Auditing Standards Board (ASB) issued Statement on Auditing Standards (SAS) no. 114, The Auditor’s Communication With Those Charged With Governance, which replaces SAS no. 61, Communication With Audit Committees, as amended. The new SAS establishes standards and provides guidance to an auditor on matters to be communicated with those charged with governance. SAS No. 114 applies to audits of the financial statements of all nonissuers and establishes a requirement for the auditor to communicate with those charged with governance certain significant matters related to the audit, including the auditor’s responsibilities under GAAS, an overview of the planned scope and timing of the audit, and significant findings from the audit. The SAS is effective for periods beginning on or after December 15, 2006. It is summarized here.

Sherron Watkins on Enron


Fraud Magazine editor Dick Carozza did an interview with Sherron Watkins, the internal [tag]whistleblower[/tag] who started raising hell at [tag]Enron[/tag] when she started discovering problems with the numbers. He asked Sherron why the Enron [tag]fraud[/tag] happened… whether management lost its way or whether the company was destined for problems. Sherron’s answer:

Many experts summarize “what happened” at Enron using two words, greed and arrogance. An accurate summary, I agree, but it fails to help others learn from Enron’s demise. How did greed and arrogance run amok at Enron? How did a company’s culture breed not only corruption from its own employees but also disreputable behavior from the outside auditors, lawyers, consultants, and lenders?

What happened? It was a complete breakdown in moral values. But the scary part is that the breakdown was not done by outright intention but more by small steps in the wrong direction.

Enron’s leaders set the wrong tone, so did Arthur Andersen’s leaders. [Arthur Andersen was Enron’s external auditor.] In the end, both companies put revenues and earnings above all else – the means by which those earnings were generated did not matter. Were laws broken? Yes. Were lives devastated by it? Yes.

Flip This House Lawsuit Continued


As I mentioned in last week’s post about the A&E television show Flip This House, Richard Davis and Trademark Properties have sued A&E. Richard claims that A&E essentially stole his idea for the show and never paid him either for the idea or for the first season in which he participated.

A&E had the case removed from state court to the Federal District Court for South Carolina. Naturally, A&E denies nearly every allegation made by the plaintiffs. The network denies that any agreement similar to the one alleged by Richard and Trademark in the complaint was ever reached. They instead say the following occurred: Continue reading

Young Pros Investigate Fraud As a Career Option


On Balance – The Magazine for Wisconsin CPAs
January/February 2007

Ever since the big corporate scandals at Enron, WorldCom and Tyco, there has been an intense focus on fraud. This has made the field of forensic accounting the next hot career for young professionals. The prospect of investigating fraud seems exciting and cutting-edge.

Fraud examiners come in all shapes and sizes. They include private investigators, law enforcement personnel, paralegals and insurance investigators. Internal auditors and independent auditors may also focus on fraud detection. Bank examiners, government investigators and forensic accountants perform fraud investigation functions. The field is still expanding, and a wide variety of jobs exist for the professional who is fascinated by fraud and white-collar crime.

It can be difficult for young professionals to break into the field. Many new graduates request forensic accounting positions, although companies seek professionals with several years of experience in fraud examination. With intense competition for available positions, a strong resume related to fraud examination is more important than ever. Continue reading

Vanishing Profession


The shortage of accounting faculty is a hot topic in academia and professional circles. Some call it a crisis.

INSIGHT – The Magazine of the Illinois CPA Society – January/February 2007
By Sheryl Nance-Nash

Over the next three years, US and Canadian universities will need to hire 942 new PhDs, but will have only 621 graduates to choose from. Which brings to light a simple truth: The number of graduating PhDs are insufficient to replace the number of professors who are due to retire over the next decade, according to research conducted by the American Accounting Association.

“This is terribly serious,” says Paul Sharman, president and CEO of the Institute o Management Accountants, (IMA) based in Montvale, New Jersey. “There are 50 percent fewer PhDs in academia than there were 10 years ago; and given the number of PhD students now, that number will likely be halved in another decade,” he contends. “The problem is growing increasingly acute.” Continue reading