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Accounting Fraud

The Morris Law Firm, P.A. is experienced with handling Accounting-fraud cases. We aggressively defend our clients and we are confident in handling various types crimes related to Accounting fraud.

If you have been wrongly accused of being involved with Accounting fraud, Attorney Melinda Morris can help. We have valuable information and resources available to help you understand key components about Accounting fraud.

St. Petersburg Accounting Fraud Lawyer

Accounting fraud is a well thought-out plan to manipulate and abuse the method of recording profits or costs in order to attain an operating turnover for the firm in order to seem competent than it essentially is. Accounting fraud involves governmental and commercial scandals which arise with the disclosure of offenses by trusted executives of large public corporations. Such crimes typically comprise of complex methods for misusing or misdirecting capital, overstating profits, understating overheads, overstating corporate assets or underreporting liabilities, sometimes with the cooperation of officials in other corporations or affiliates.

In public traded companies, the act of "stimulated accounting" can be the result of fraud. Investigations are usually launched by government oversight agencies, such as the Securities and Exchange Commission (SEC) in the United States.

The Morris Law Firm can assist with; common cases of fraudulent financial reporting:

  1. Exaggerating on incomes and properties;
  2. Devaluing overheads, expenditures, and obligations;
  3. Influencing the timing of when transactions are documented or events are recognized;
  4. Inaccurately assessing or appraising the effects of transactions or events;
  5. Abusing general accepted accounting principles; and
  6. Falsifying or neglecting information material to users of financial figures.

Financial reporting fraud typically causes huge losses in shareholder value and corrodes trust in asset markets. Several United States governing agencies track financial frauds. The United States SEC (Securities and Exchange Commission), DOJ (Department of Justice), class-action lawyers and state attorneys all have an entrusted concentration in pursuing cases of fraud and warranting that it does not recur. Local European regulators are closely following the United States model. A recent analysis from over five years of regulatory actions shows that there is a substantial association between Securities and Exchange Commission, Department of Justice and class actions.

The Securities and Exchange Commission conducts investigations and brings civil enforcement actions in assembly with possible violations of securities laws and the Securities and Exchange Commission rules and regulations (Rule 10b-5). The Department of Justice and United States state attorneys investigate and convict individuals and commercial establishments for deeds that are considered a crime under United States federal and state laws. The Morris Law Firm looks at reductions in private litigant losses and shareholder values or attempts to recover these funds from corporations and individuals.

The Morris Law Firm recognizes that the most frequent type of financial accounting fraud involves improper revenue recognition, including premature recognition. Recent class actions regularly allude to inappropriate internal controls within the allegations.

A review of Securities and Exchange Commission prosecution activities has found that in over 80 per cent of these matters, one or more of the following high-ranking managers were involved:

  • (CEO) Chief Executive Officer
  • (COO) Chief Operating Officer
  • (CFO) Chief Financial Officer
  • (CAO) Chief Accounting Officer

These are all officers in executive positions, which specifies why frauds are inclined to involve management override of controls that otherwise, may seem to be operating efficiently. These executive officers are the most common to be charged with fraud; however, the Morris Law Firm is aware that these circumstances generally conspire and others engage in this process as well.

The Morris Law Firm has found that financial fraud crimes are most likely to happen when one or more of the following elements exist:

  1. Focus is based exclusively on profits.
  2. Poorly control environment;
  3. Immensely weak internal accounting controls;
  4. Mix-ups by executive management, the audit committee and the board of directors;
  5. Tantalizing restitution systems and disciplinary processes not supportive of compliance and a zero tolerance methodology.
  6. Deficient monitoring of controls and compliance with corporate rules and regulations.

The most financial frauds deal with a failure to ensure proper and sufficient records of and support for transactions and accounting events. Secondly, most financial frauds occur in an atmosphere where there is inadequate regulation by the officers in control of financial and accounting.

Preventive measures for accounting fraud:

  1. The right tone starts by having operational audit committees that manage critical risk, control and accounting areas. The Chief Executive Officers and Chief Financial Officers need to keenly communicate the significance of accurate accounting and reporting, even at the expense of profits and objectives. Accurate accounting is not a misfortune. It entails investment in a lot of important control areas, including critical accounts and disclosures, and must be implemented and mandated by an expert accounting sector, with techniques that are frequently tested by a self-governing internal audit function.
  2. Do not allow any moral wrongdoings or belligerent accounting, regardless of the amounts involved. When dealing with impending transgression, whether reported by an informant, warrant that a proper investigation is commenced and do not tolerate any recognized misconduct. This will allow you to avoid repetition of any transgressions. Zero tolerance for serious misconduct is the best course of action.
  3. Follow up on all allegations of misconduct. Never focus on the source of the allegation, but focus on allegation facts. Serious allegations of management misconduct should be followed up with an independent investigation and appropriate remediation actions, which generally involve measures regarding personnel, accounting, taxation and internal controls.
  4. Avoid having an accounting department of pure bookkeepers and ‘good soldiers’. Accounting departments need to be familiar with US GAAP, IFRS, and any other relevant GAAP. Accountants cannot be allowed to be just bookkeepers. They must act as a major line of defense to prevent any improper accounting and act as sparring partners for the business. This also means that GAAP rules need to be embedded into local procedures, processes, and controls, rather than allowing for spreadsheet-type adjustments to reconcile or handle complex GAAP areas (US GAAP reconciliation process).
  5. Invest in GAAP training and ensure that resources and policies are adequate to address complex accounting areas. All too often, accountants in business do not have the training or expertise to deal with complex areas of accounting. There can be a tendency to solely rely on the external auditor, which is no longer possible under Sarbanes-Oxley. Investing in regular (at least annual) training and having the right people (in terms of experience and attitude as gatekeepers and business partners) are critical to success.

Morris Law Firm, P.A. | Florida Accounting Fraud Defense Lawyer

Melinda Morris represents clients as an experienced white collar crime attorney in Pinellas County and the entire Tampa Bay, FL area (St. Petersburg, Tampa, Hillsborough, Pasco, Manatee, Sarasota). Accounting fraud takes place in various forms. These types of charges are very severe and may seriously affect your professional reputation. The involvement of the state government and possibly the FBI makes it even harder to follow without a guide. Attorney Melinda Morris has years of practical and functional knowledge when it comes to white-collar crimes, such as Accounting fraud in St. Petersburg, Clearwater, and Pinellas County.

If you are facing charges related to Accounting fraud, you need an attorney. Contact St. Petersburg’s white-collar attorney for more information about your Accounting fraud case throughout the Tampa Bay area including Tampa, Clearwater, Bartow, New Port Richey, Dade City, Plant City, including the counties of Hillsborough, Pasco, and Pinellas or surrounding areas. Contact Attorney Melinda Morris with The Morris Law Firm, P.A. at (727) 388-4736 to get assistance with your legal needs related to accounting fraud.

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