Wouldn’t it be nice if the caller ID was actually that accurate for every call? Image courtesy of Adobe Stock.
The most frequent scam in 2016 was the phone calls saying “This is the IRS and if you don’t pay your past due taxes this instant we will send someone to your house to arrest you right now.”
There are many things wrong with those calls.
As a starter, your first contact with the IRS will never be by phone. You will instead get a letter explaining what the IRS thinks you messed up.
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Board training, Fraud, Non-profit Tax, Other stuff | 
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Posted by Jim Ulvog
Image courtesy of DollarPhotoClub.com
Most people hang up on robocalls from charities. If there is a real person, I ask them to go into their spiel and then set the phone down, letting the caller waste a minute or two of their time.
William P. Barrett, writing at New To Seattle, actually takes those calls. He then dissects the charity’s financial statements showing the minimal amount of charity taking place in some organizations.
To the repeat offenders he awards the title of “America’s Stupidest Charities.”
You probably know scammers have a new scheme of falsely claiming to be from the IRS. Their spiel is you’re just about to be arrested for failing to pay back taxes, the police are on the way to your home, but you can avoid going to jail today by settling up right now by sending money on a prepaid debit card or wire transfer.
Mr. Barrett called back to the number provided in a robocall. The person answering spoke poor English and sounded like he was calling from a boiler room.
He describes the call in his post, Scammers invoking the IRS inundate Seattle.
How did that conversation go? Quite entertainingly.
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Posted by Jim Ulvog
I’ve dropped the prices for the print copies of my books available at Amazon, Barnes & Noble, and iTunes store.
Here is what you can find on-line:
Tragedy of Fraud – Insider Trading Edition
Story of Scott London’s fall from regional audit partner at KPMG to prison inmate because of his insider trading.
Leave a Comment » | Auditing, Board training, Books you might enjoy, Compilation and review, Fraud, Internal control, Non-profit accounting | Tagged: audit, compilation, differences between audit review compilation, fraud, nonprofit accounting, review | Permalink
Posted by Jim Ulvog
It is scary to see the power of rationalization. We humans can exert great effort to persuade ourself that wrong is right. With enough effort, we can persuasively argue that wrong is a positive good, the noble alternative.
It is unsettling to me when I see a client deeply believe that tax or accounting fraud is perfectly legitimate and I am the one who is in the wrong to suggest otherwise. Worrisome is a watching a friend who believes that hurtful or destructive or nasty or evil behavior is Godly. Even more upsetting is when I catch my brain in full rationalization mode.
No, I’m not about to give any examples from clients, friends, or my life.
Unfortunately, we have a sad public example of rationalization racing at full power (sad pun intended).
(Cross-post from my other blog, Attestation Update.)
Some background on Lance Armstrong’s massive doping schemes
Many public sources report that Lance Armstrong has been found to use performance enhancing drugs for a very long time. He won seven consecutive Tour de France races.
According to Wikipedia, in 2012 he received a life-time world ban on all competitive events in all sports. His seven wins were revoked. He was found to have engaged in sophisticated doping schemes for many years.
In 2013, he admitted massive doping in an interview with Oprah Winfrey. He admitted using a long and specific list of banned substances and did so in each of the 7 Tour de France races.
Rationalization on display
Having set the background, let’s look at an article in The Guardian: Lance Armstrong: I would probably cheat again in similar circumstances. Thanks to Professor Mike Shaub (twitter @mikeshaub) for pointing out the article.
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Posted by Jim Ulvog
I recently had the opportunity to visit with Sam Antar, convicted felon and former CFO of Crazy Eddie.
During our interview, Mr. Antar suggested a reason why businesses don’t put enough effort into fraud prevention and detection. He said the cost of deterring fraud may be more expensive than the consequences of fraud. Before I refine the concept, look at some costs he mentioned:
I would add to that the time involved to implement quality controls, policies, and procedures. Those will take a lot of time for the finance & accounting team. In turn, those procedures will take time for operational staff to follow. All of that translates into more staff.
That can get costly fast.
What is the cost of a fraud incident
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Posted by Jim Ulvog
Sam Antar is a convict and former CPA. He was the CFO of Crazy Eddie, which by his description was an intentionally fraudulent business.
I recently had opportunity to interview him by phone. Will have more of our conversation in future posts.
What I’m going to do in these discussions is combine his comments and ideas with my thoughts.
Advice for charities
I asked him what advice he would have for small charities to prevent fraud.
Wow, was that a mistake. I should not have used the word “prevent.”
You can’t prevent fraud. If someone is intending to steal or is completely determined to cook the books, they will find a way.
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Posted by Jim Ulvog
Both books in my Tragedy of Fraud series are now available in print format from Amazon.
The newest book:
Tragedy of Fraud – Insider Trading Edition describes – Scott London’s long fall from Big 4 audit partner to prison inmate.
Click the link for your reading preference:
First book in the series:
Tragedy of Fraud – The Ripple Effects from Fraud and the Wages Earned – Consequences of fraud spread far. There is a long list of well-earned wages from fraud that will be paid in full.
Available in your preferred format:
Leave a Comment » | Board training, Books you might enjoy, Fraud, Other stuff | Tagged: fraud | Permalink
Posted by Jim Ulvog
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