Devin McCraney and Sharika Allison were the District Finance officer and Comptroller, respectively, for the Beaumont Independent School District (BISD), Beaumont, TX. From August 2010 until October 2013 they managed to embezzle over $4,000,000 from the school district by creating fake companies, issuing purchase orders and invoices that paid directly to an account controlled by both McCraney and Allison. From there Allison, who had taken out the DBA of “Millennium Consultants”, would write checks that were the deposited into their personal bank accounts. BISD did regular business with Millennium USA, an actuary company that would give annual workmen’s comp analysis.
Devin McCraney was hired in 2008 as the Comptroller and promoted to Director
…show more content…
Attorney Malcolm Bales described as an “audacious scheme” to steal was actually fairly simple. Finance Director McCraney and Comptroller Allison were the BISD foxes charged with guarding the henhouse, and the indictments describe an insatiable greed for cash, a total of $4,041,705.27 stolen by means of 18 separate wire transfers to bank accounts under their personal control. The transactions took place between Aug. 23, 2010, and Oct. 24, 2013, 11 days before an FBI raid on BISD headquarters and the homes of McCraney and Allison brought the alleged scheme to an apparent halt.” …show more content…
It was then uncovered that McCraney purchased a home, in cash, worth an estimated $125,000 and immediately started remodeling and expanding the home. He also purchased five different makes and models of cars totaling an estimated $206,790, in cash. Along with the house purchase and remodel and the vehicles he had several bank accounts with different banks, and paid off the mortgage to his wife’s house in the amount of $79,000. McCraney’s listed annual salary as Director of Finance was $75,500. He had no other income listed, had not suddenly won the lottery or inherited a large sum of money. He pleaded guilty to fraud upon programs receiving federal funds, and has been sentenced to 68 months (approximately 5 years) to federal prison.
There is not as much information on Sharika Allison and the reasons behind her willingness to fraud the district. It is stated that her annual salary was estimated at $62,000 as comptroller. Allison plead guilty to the charge of conspiracy to commit fraud upon programs receiving federal funds and was sentenced to 48 month (just over 3 years) to federal
Debra became the assistant vice-president and manager of energy lending of a Canadian Western Bank on January 31, 2006. Within a month Debra set up her embezzlement scam by creating two corporations that the embezzled funds would be funnelled too. Debra set up an account in a woman’s name using the woman’s GIC (guaranteed investment certificate) which was worth 8 million dollars. Debra started with 100,000 dollars in a line of credit using the woman’s name and increased it 6 times until the line of credit reached $950,0000 on November 6, 2007. Additionally, Debra arranged for 5 new accounts in the same woman’s name with a total deposit of $16.4 million. Debra made 72 unauthorized withdrawals from the fake account in the two year time frame of the scam. She kept the scam going by transferring money from the
Another cash larceny scheme that could have been committed was reversing transactions or revering entries. By stealing funds, Sachdeva and Mulvaney could have gone back into...
In recent years, it seems as if there is a new financial fraud being reported any given day. One could even say that fraud has become almost a much a surety as taxes. Given the opportunities and pressures, many will businesses will fall victim to human natures and suffer losses through fraudulent activities. This case study will follow one such fraud, following the crimes of Terry Scott Welch in his pursuit for happiness by indulging his passion of landscaping.
I believe that asset misappropriation by accounts payable fraud is occurring at Wayland Manufacturing Company due to a lack of proper internal controls. Making the company’s Chief Accountant responsible for additional day-to-day functions provides him with opportunity to commit by creating fictitious vendors with his information and then creating fictitious invoices. Newbaker can then conceal his fraud by approving the invoices for payment. Employees working at an organization for more than five years are more likely to commit fraud. Therefore, Newbaker’s six-year history with the company has made him trustworthy and very knowledgeable, which could indicate involvement in asset misappropriation. The high employee turnover could represent a past fraudster leaving before getting caught or employees refusing to continue with the asset misappropriation. In addition, the varying monthly accounts payable transactions ranging from the lowest being April 2014 and
On March 5, 2004, Martha Stewart, a successful business woman and the founder of Martha Stewart Living Omnimedia was sentenced by the jury to five months in prison at a minimum-security federal prison, another five months of home confinement along with 19 months of probation and $30,00 fine. Stewart was found guilty on four counts in what seemed to be known as white-collar crime. In this paper, I will briefly explain, identify and answer respectively in order on the three topics of, what crime did Martha Stewart commit, what evidence did the jury appear to find most convincing and whether should Stewart have received prison time. I will be using my own ideas along with the researches from reputable and credible sources to support my ideas.
Rita Crundwell was the trusted comptroller and treasurer of Dixon, Illinois with a passion for horses. She took advantage of her trust and responsibility to commit the largest known municipal fraud in the history of the United States. This fraudster has surprised and astounded people around the world by the amount of the fraud and for how long it went. Rita served the small town of Dixon from 1983 to 2012 until sentenced to nearly twenty years in federal prison for embezzling an astonishing $53.7 million. The story of this Dixon Commissioner shocked her small town and is studied by auditors all over.
"… Cynthia Hood, 55, was entitled to a lighter sentence because she was not the ringleader of fraud and because her children would be in jeopardy without her presence"("Furst"). Cynthia Hood is one of many people who thought they would get away with criminal actions, yet her husband did the time in jail, even though she had the money behind her. Even though wealthy people believe they would get away with their crime they still had to pay the
Madura, Jeff. What Every Investor Needs to Know About Accounting Fraud. New York: McGraw-Hill, 2004. 1-156
Her most recent act of destruction involves a pending felony grand theft charge, where she attempted to illegally obtain a $2,500 designer necklace by the act of shoplifting from a Jewelry store. She has been sentenced to 120 days in jail, but got out on a $75,000 dollar bond.
Jordan Belfort is the notorious 1990’s stockbroker who saw himself earning fifty million dollars a year operating a penny stock boiler room from his Stratton Oakmont, Inc. brokerage firm. Corrupted by drugs, money, and sex he went from being an innocent twenty – two year old on the fringe of a new life to manipulating the system in his infamous “pump and dump” scheme. As a stock swindler, he would motivate his young brokers through insane presentations to rile them up as they defrauded investors with duplicitous stock sales. Toward the end of this debauchery tale he was convicted for securities fraud and money laundering for which he was sentenced to twenty – two months in prison as well as recompensing two – hundred million in restitution to any swindled stock buyers of his brokerage firm (A&E Networks Television). Though his lavish spending and berserk party lifestyle was consumed by excessive greed, he displayed both positive and negative aspects of business communications.
Weld, L. G., Bergevin, P. M., & Magrath, L. (2004). Anatomy of a financial fraud. The CPA
This case illustrated that there were real consequences to white collar crime. In addition to paying the fifty million dollar fine, he relinquished another fifty million dollars of his illegal trading profits. (He still had millions remaining, however, from his illegal gains.) His actual prison sentence was three years, yet he served only twenty-two months in the federal prison at Lompoc, California, which was known to have a “country-club” atmosphere.
Jordan Belfort is the notorious 1990’s stockbroker who saw himself earning fifty million dollars a year operating a penny stock boiler room from his Stratton Oakmont, Inc. brokerage firm. Corrupted by drugs, money, and sex, he went from being an innocent twenty – two year old on the fringe of a new life to manipulating the system in his infamous “pump and dump” scheme. As a stock swindler, he would motivate his young brokers through insane presentations to rile them up as they defrauded investors with duplicitous stock sales. Toward the end of this debauchery tale he was convicted for securities fraud and money laundering for which he was sentenced to twenty – two months in prison as well as recompensing two – hundred million in restitution to any swindled stock buyers of his brokerage firm. Though his lavish spending and berserk party lifestyle was consumed by excessive greed, he displayed both positive and negative aspects of business communications.
The Tyco accounting scandal is an ideal illustration of how individuals who hold key positions in an organization are able to manipulate accounting practices and financial reports for personal gain. The few key individuals involved in the Tyco Scandal (CEO Kozlowski and CFO Swartz), used a number of clever and unique tactics in order to accomplish what they did; including spring loading, manipulating their ‘key-employee loan’ program, and multiple ‘hush money’ payouts.