Posts Tagged ‘Investment Fraud & Ponzi Schemes’

The Mormon Madoff: How Shawn Merriman Scammed Millions

Jenna Martino, CNBC Associate Producer

Shawn Merriman was head of an investment firm and lay bishop in the Mormon church who persuaded friends, family, and church members to invest with him. It turned out to be a big scam, taking in more than $21 million. Among victims: his own mother.

What Merriman did is considered affinity fraud — where a perpetrator tries to swindle a specific group out of money. While Merriman was already a long-standing member of the Church of Latter-day Saints, other fraudsters have been known to specifically infiltrate a group with the sole mission of perpetrating a scam.

Finding Hidden Income and Assets

Written by Tracy L. Coenen, CPA, CFF

Cases of financial fraud often focus on the core issue of where the money went. Successfully carrying out a fraud scheme involves not only taking the money, but covering up the fraud and hiding the money trail. Recent headlines have consumers wondering how someone like John Corzine of MF Global could have no idea where hundreds of millions of dollars went. But skilled financial investigators know there is always a trail, and while the money may or may not be recovered, it can be located.

Cases involving allegations of security fraud, money laundering, misappropriation of assets, income tax fraud, and Foreign Corrupt Practices Act (FCPA) violations require investigators to follow a money trail. However, sometimes it is difficult to know where to start, or where to continue when you’ve come to an apparent dead end.

Looking Behind the Numbers in Litigation

Written by Tracy L. Coenen, CPA, CFF

Nearly every lawsuit has a financial component to it. In many cases, the issues surrounding the numbers have high stakes.  Cases involving securities fraud, money laundering, tax fraud, investment fraud, and Ponzi schemes rely on an accurate tabulation and evaluation of the numbers. To take the numbers as provided by the other side at face value, however, would be a huge mistake.

Short On Ethics

American Journalism Review

By Cary Spivak

Two Web sites that investigate business fraud are funded by short selling—placing market bets that the stock of companies they write about will go down. It’s an approach that makes journalism ethicists very uncomfortable.

At first the idea didn’t feel quite right to Christopher Carey.

Red Flags Pointed Directly to Madoff

Written by Tracy L. Coenen, CPA, CFF

It’s hard to believe that a Ponzi scheme as massive as the one perpetrated by Bernard Madoff got by anyone. Surely he was the most clever criminal alive, and was ingenious at hiding his fraud. There couldn’t have been any signs of the scam he was running. Or were there?

Ex-Con Now Walks a Financial Tightrope

Cary Spivak – Milwaukee Journal Sentinel

The latest business plan at the lofty-sounding Fraud Discovery Institute seems invincible: Gather negative information about a company, place a bet that the price will decline by selling its stock short, and then publish the negative information online.

When the stock price plummets, you cash in.

Are We Really Getting Tough on Financial Fraud?

Written by Tracy L. Coenen, CPA, CFF

Consumer outrage about “bailout madness” and the proliferation of Ponzi schemes and investment fraud is fueling a push for greater oversight and regulation. The government is talking tough, saying that there will be more prosecutions for financial fraud forthcoming..

That sounds good, doesn’t it? Of course we’re all in favor for more aggressively pursuing those who swindle others out of their savings or cheat the system. But while more prosecutions make good headlines, how realistic is this goal?

Red Flags Apparent in Alleged Ponzi Scheme

Written by Tracy L. Coenen, CPA, CFF

Wisconsin Law Journal

Recent news of the alleged $50 billion Ponzi scheme perpetrated by investment advisor Bernard L. Madoff has done nothing to ease the fears of investors who have been annihilated by the stock market over the last couple of months.

CM Development: The Sales Pitch Was Great, But the Company Fell Apart

The Virginian-Pilot
By Matthew Jones and Meghan Hoyer

Invest in real estate. Make money. Improve neighborhoods.

That was the pitch, and it usually started with a ride.

Cary McEntee would be at the wheel, steering his black Cadillac Escalade through some of Hampton Roads’ poorest neighborhoods. His brother, Jacques, usually rode shotgun.

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