Friday, January 21, 2005

Fraud: Even Compliance Officers Need Oversight

Many fraud cases arise from situations where oversight is lacking.  What proves to be the most unfortunate are those cases where the individual handling the company oversight is the person committing the fraud.

The Atlanta Journal Constitution reports on a case that may prove to fit within this category. The "vice-president in charge of compliance" "for Applied Financial Group Inc., an Atlanta firm that dispenses investment advice"  was charged today in a "295-count federal indictment."  According to the article  the amount of the defrauding is  "more than $5 million."

(esp)

Addendum (ph) - In addition to the filing of a criminal case, the SEC also filed a civil action.  See SEC Litigation Release.  "The complaint alleges that from early 2000 through early 2004, Ms. Longo misappropriated at least $5.4 million from the accounts of four profit-sharing plans that were advisory clients of Applied Financial Group."

http://lawprofessors.typepad.com/whitecollarcrime_blog/2005/01/fraudeven_compl.html

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