worldcom – Fraud Files Forensic Accounting Blog

Why Audits Fail to Find Fraud

29 February 20122 March 2008 by Tracy Coenen

I am reading Cynthia Cooper’s book, Extraordinary Circumstances, which documents her experiences uncovering the massive fraud at WorldCom. I want to finish reading the book so I can write a proper review here and elsewhere. But I admit I’m having a hard time finishing the book due to all the other demands on my time…

Nonetheless, I wanted to share this passage from the book because it illustrates so perfectly the main reason why audits fail to find fraud: Those committing fraud know how to hide it from the auditors. Because of that active concealment, there is little chance of the auditors finding the fraud.

Cynthia Cooper’s book – Extraordinary Circumstances: The Journey of a Corporate Whistleblower

14 August 201128 January 2008 by Tracy Coenen

Cynthia Cooper, WorldCom whistleblower, is releasing her book in just few days. Extraordinary Circumstances: The Journey of a Corporate Whistleblower is her story. If it is anything like the speech I heard her give a few years ago at the Association of Certified Fraud Examiners Fraud Conference, it will be fantastic. Unlike other so-called whistleblowers … Read more Cynthia Cooper’s book – Extraordinary Circumstances: The Journey of a Corporate Whistleblower

Conviction of Bernie Ebbers Upheld by Appeals Court

1 November 201129 July 2006 by Tracy Coenen

Today the U.S. Court of Appeals for the Second Circuit upheld the conviction and prison sentence of former WorldCom CEO Bernard Ebbers. The 64-year-old defendant was convicted in 2005 of nine counts of conspiracy, securities fraud, and false SEC filings. He received a 25-year prison sentence, which all but assures that he will die in … Read more Conviction of Bernie Ebbers Upheld by Appeals Court

Sarbanes-Oxley Cost Versus Benefit

4 November 20112 January 2006 by Tracy Coenen

The New Yorker recently printed a commentary on Sarbanes-Oxley. While the legislation was viewed by politicians as an important step toward protecting investors from fraud, corporate executives aren’t so impressed.

Corporate executives believe that the high cost of implementing the Sarbanes-Oxley regulations is not justified by the small benefits. The cost of implementation is particularly high for smaller companies, which may discourage them from going public.

Tracy Coenen on Mary Kay Cosmetics: Destroying Half a Million Women a YearWho are you speaking to, D Holland? Are you speaking to the 99% of MLM participants who lose money? Are...

NL Jackson CFE on Fraud During the Coronavirus (COVID-19) CrisisTracy, from one fraud fighter to another I couldn't agree more with your above excellent warnings. The hard part is...

D Holland on Mary Kay Cosmetics: Destroying Half a Million Women a YearObviously direct sales isn’t for everyone. You actually have to Work. Funny how you can blame a...

Tracy Coenen on The Pyramid Scheme Aspect of Primerica Financial ServicesOh, Primerica very much endorses the deception that goes on in the recruiting process. They rely on it for their...

Tracy Coenen on The Pyramid Scheme Aspect of Primerica Financial ServicesGuess what? People DO get to "decide for themselves." And they can do it with the help of information I...

Trinity1 on The Pyramid Scheme Aspect of Primerica Financial ServicesIn addition, all of the negative comments on this thread are about people, not Primerica. If you were a...

Trinity on The Pyramid Scheme Aspect of Primerica Financial ServicesHere's a novel idea. Let people decide for themselves what they do. Most people recruited to Primerica have...

OttoAuto on Shark Tank’s Barbara Corcoran $400k Fraud VictimYet, it's a good cautionary story, as many have fallen for basically the same type of scam, but were NOT...