04 Sep

The Forensic Accountant as Consultant

Forensic accountants are usually retained in family law cases as expert witnesses, with the intention that they will provide expert opinions and testimony on behalf of the client. Although retention as a consultant is less common, it is an important option to consider. Sometimes, the work of the consultant can be even more important than the work of the testifying expert. The consultant may be able to dig deeper into sensitive issues because there is no fear of testimony or of disclosing the consultant’s work.

Maintaining privilege
One of the biggest benefits to retaining a consultant is the fact that the consultant’s communications and work product enjoy privilege. Because the consultant is essentially an extension of the law firm, the identity of the consultant, the scope of work, the evidence examined, and the results of the work need not be disclosed to opposing counsel. (Note that documents examined by the consultant may very well need to be disclosed as part of the discovery process, but the consultant’s work or impressions of the documents should not be disclosed.) Read More →

30 Aug

Qualifying as an Expert Witness

You are only an expert if the judge says you’re an expert. No matter how many times you may have testified in court as an expert witness, each time you must prove all over again that you’re qualified to provide expert testimony.

In this video, Tracy Coenen talks about how she presents herself to the court as a forensic accountant so that she will be qualified to provide expert testimony. It is a combination of education, credentials, and experience.

28 Aug

Why Is It So Easy to Commit Fraud?

It sometimes seems like it’s easy to commit fraud at work. Why is that so?

One of the main reasons is that employers must put trust in their employees and give them access to data and assets. It’s also important to remember that employers give responsibility to people who are trusted. If someone wasn’t deemed trustworthy enough to take money to the bank, she or he wouldn’t be handed the bank deposit. That trust inherently means that opportunities to commit fraud are handed to employees each day. Read More →

20 Aug

Tax Returns and Divorce Cases

One of the most common documents utilized in a financial investigation is the income tax return. It’s a key document in any divorce case, so the personal income tax return is always examined. And if there is a business, the tax return for that entity should be examined too.

What can we learn from the tax return? Maybe more than you imagine. Today I’m going to walk through the lines on the personal tax return (Form 1040) and some ways that these items can be analyzed to search for hidden income and hidden assets. Read More →

17 Aug

What to Do After a Fraud Investigation

After a fraud investigator is done with her work and has issued the expert report, company management and retained attorneys must decide what to do with the information presented. If the case is already in litigation, the use of the report is obvious. If the company has not yet taken action, a few options should be considered.

Internal Discipline

It is natural to want to dismiss an employee as soon as it is apparent that the person has committed a fraud. It is often safer for the company to have the suspect off-site, so that no more fraud can occur, but it is important to realize that this may also hamper the gathering of information. For this reason, some companies decide not to immediately terminate the employee. If the employee is still actively employed by the company when the fraud investigator’s report is issued, a decision must be made about her or his future. The company could decide to do nothing if sufficient evidence is not available or if the evidence exonerates the employee. Read More →

14 Aug

Net Worth Method of Proof for Unreported Income

When an IRS auditor or criminal investigator suspects that a taxpayer has unreported sources of income, he or she looks for ways to calculate that unreported income. One way is the net worth method of proof.

Forensic accountants and fraud investigators can use the same method to calculate unreported income in other types of cases, such as divorce. In this video, Tracy describes how the calculation is done and how the results may be used.

10 Aug

Skills of a Fraud Investigator

How do I become a fraud investigator? What skills does a forensic accountant need? I get asked these questions a lot, so today I’m going to give my thoughts on some of the important qualifications and skills a fraud investigator might have.

The educational background of a good fraud investigator can fall into a wide range of disciplines. Fraud investigators have degrees in accounting, finance, police science, law, and criminal justice. There is no widely accepted course of study for fraud investigators, although those degree programs that offer a strong foundation in accounting and finance seem to prepare students well for the numerical component of investigations.

Many excellent fraud examiners have a work history that is far more important than their educational background. On-the-job experience as a police detective, federal agent, insurance claims analyst, financial statement auditor, or financial analyst can lend itself well to a career in fraud investigations. It’s not unusual for practical experience in the field to play a much bigger part in the fraud investigator’s skills than any type of classroom training. The field of fraud examinations has an extremely varied range of educational and work experience. Other careers often have a few well-defined career paths, but the road to success as a fraud investigator can lead in many directions. Read More →

08 Aug

Behavior of Upper Level Executives Who Commit Fraud

A while back we talked about behavioral red flags of fraud, which are the signs that someone might be involved in a fraud at work. Some of the most common red flags are living a lifestyle that exceeds a person’s earnings and unusual attitudes on the job (being combative, possessive of their work, etc.)

The same red flags don’t necessarily apply to upper-level executives, or they’re just not as easy to spot. In this video, Tracy talks about some of the warning signs we might see with top executives who are committing fraud. Most commonly, we see a higher level of greed and arrogance when committing fraud (which, coincidentally, may lead to the person’s downfall).

06 Aug

Faces of Milwaukee: The Face of Forensic Accounting

From the Faces of Milwaukee 2018 special feature in Milwaukee Magazine:

It wasn’t an accident that Tracy Coenen became a forensic accountant. She always had an interest in the criminal justice system, with an eye toward becoming a prison warden.

While attending Marquette University, a specialty class in the criminology program called Financial Crime Investigation was enough to hook Tracy.

She worked as a financial statement auditor at the “Big Six” firm Arthur Andersen before moving to a small forensic accounting firm to learn the art of fraud investigations. Tracy stepped out on her own more than 18 years ago to start Sequence Inc., where she works exclusively in the area of forensic accounting. Read More →

03 Aug

Why My Clients Work With Me

It’s important to think about why your clients work with you. It can guide your marketing efforts and it can help you refine your service offerings.

My clients like the fact that what they see is what they get. I’m the forensic accountant who will do all the work on their project. They don’t have to worry about someone inexperienced learning the art of forensic accounting on their dime or possibly even botching their case. Experience is key, and my clients know that they get my experience.

My clients also like that: Read More →