An Ounce of Prevention

If you haven’t heard by now, internal fraud is expensive, costing companies an average of 6 percent of revenues each year. Employees are in an excellent position to steal the company blind. Particularly for those in upper management, access to assets is easy to come by.

With an estimated $3.7 trillion stolen annually by employees around the globe, companies should be highly motivated to invest in fraud prevention. Creating and implementing effective policies and procedures is not cheap, but it is far less expensive than exposure to internal fraud.

Companies should develop a comprehensive fraud prevention program that impacts all areas of a company. Such a program has three critical parts: education, investigation and proactive prevention.

Read moreAn Ounce of Prevention

Lifestyle Analysis in Family Law Cases

LifestyleAnalysisInDivorceCasesSmallThis article was originally printed in the ABA Section of Family Law eNewsletter, November 2011.

One of the chief concerns in a divorce or child custody case is identifying the true income of one or both of the parties. It is not unusual for such a case to include allegations of hidden income or assets. It is common for a closely held business to suspiciously encounter declining sales and profits following the filing of a family law case.In each of these instances, properly determining the income of the party is critical to getting a fair and equitable settlement, maintenance award, or child support award. Until you have the correct numbers, the attorney may find it very difficult to decide what is fair or in the best interest of the client.

Read moreLifestyle Analysis in Family Law Cases

Man on Top, a Film About Multi-Level Marketing (MLM)

Man on Top is a documentary about multi-level markeing (MLM). It being directed and produced by Paul Mathieu. The film tells the story of MLM and how it has cheated consumers out of billions of dollars with its fake business opportunity: Man On Top is the story of multi-level marketing, the world’s most notorious business … Read more Man on Top, a Film About Multi-Level Marketing (MLM)

Jennifer McKinney Fraud Update

It’s been a while since we have looked at the many legal troubles of Jennifer McKinney (aka “MckMama”) and her husband Israel McKinney. In short, Jennifer and her husband have repeatedly stiffed creditors for hundreds of thousands of dollars, losing FOUR houses and having their bankruptcy filing denied after trustee Gene Doeling busted them for lying in their court filings.

This week, the McKinneys lost the fourth house. Marine Credit Union obtained a default judgment against them after they failed to even respond to the lawsuit filed against them for failing to make payments on their house. The bank got a judgment of $334,105 (plus interest) for the house, and $2,528 for attorneys’ fees. The McKinney’s (well, really the bank’s) house at W5441 Innsbruck Road in West Salem, WI will be sold at a sheriff’s auction. Marine Credit Union can pursue the McKinneys for any deficiency (if the sale price of the house does not cover the total that they owe).

Read moreJennifer McKinney Fraud Update

Fostering a Culture of Integrity in Your Business

The average business loses approximately 5% of revenues to employee fraud. The employees are running off with money, fixed assets, and business opportunities. They are taking kickbacks from suppliers who overcharge for their products and services, and pushing contracts toward friends and relatives. Executives are manipulating financial statements to increase stock prices and impress lending institutions.

These types of dishonest activities can be decreased, however, by companies that take action to prevent and discourage fraudulent behavior. An extensive fraud prevention program might be the most effective way to reduce fraud opportunities, but following a recent flurry of regulatory requirements, many companies aren’t willing to invest more in revamping policies and procedures.

Activities that were traditionally thought to deter and detect fraud, such as independent audits and internal examinations, have been found to be less effective than previously believed. Those types of procedures may still provide some valuable business benefits, but they should not be relied upon as a primary tool for detecting and preventing fraud.

Read moreFostering a Culture of Integrity in Your Business