Presentation to MAS: A World’s First Fact-Based Forward-Looking Fraud Detection System for Singapore

MAS PresentationLast week, we are honoured and grateful to be able to have the opportunity to share our thoughts and to have a sincere and productive conversation with the top management team at the regulatory authority in Singapore about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community.  Accounting information can be used to inform – or to deceive. We believe strongly that this potential fintech platform that combines accounting data, especially footnotes, with a wide array of contextual information – including unusual related-party transactions; money-go-round off balance-sheet activities; governance, group structure and ownership analysis; textual and linguistic analysis; analysis of event-based “catalysts” (information-based manipulation) and sensitive market announcements (action-based manipulation in prices and volume) – will provide fresh insights and actionable, dynamic, inter-connected analytical information, as opposed to merely descriptive static data or a loose bag of disparate red flags, on Singapore and Asian companies, for the regulator and the public.

Public disclosure of the List of companies in the highest risk decile by the five fraud categories (tunneling fraud; grand capex fraud; M&A deals potion fraud; all-in-the-family expense and liability shift; consolidation craftiness fraud) on the regulatory websites to inform and educate public (Financial Literacy 2.0) can (a) prevent harm before fraud happens, and (b) spur the potentially fraudulent firms to act to improve their corporate governance, e.g. return back part of the expropriated “missing cash”, to get themselves off the List. This will also bring about greater efficiency in the overall regulatory system given the limited resources in going after so many fraudulent cases which may occur and implode systematically during poor market and economic conditions (e.g. the reverse merger fraud wave in U.S. that was concentrated in 2011).

Advertisements

Aim’s Chinese disasters offer cautionary tale for chancellor

http://www.ft.com/intl/cms/s/0/a4b710f2-61f8-11e5-9846-de406ccb37f2.html#axzz3mfuQLSl6

September 23, 2015 11:24 pm

Aim’s Chinese disasters offer cautionary tale for chancellor

Kate Burgess

If the UK Chancellor wants a cautionary tale for his initiative to link London and Chinese stock markets, he should look to the Alternative Investment Market.

This week two of the 45 China-­based companies quoted on London’s junior market have either had their operations suspended or their shares. They are just the latest of a long string of Chinese disasters on Aim. Continue reading

Police in Taiwan are investigating the whereabouts of the chairman of a listed company on bail awaiting trial in Hong Kong for fraud, after reports he was abducted in New Taipei City; Missing chairman sees Pearl Oriental shares plunge 15pc

Hong Kong fraud accused feared abducted in Taipei
25 September 2015
Police in Taiwan are investigating the whereabouts of the chairman of a listed company on bail awaiting trial in Hong Kong for fraud, after reports he was abducted in New Taipei City on Sunday.

Wong Yuk-kwan, 68, who is also known as Wong Kun, is accused of defrauding the Securities and Futures Commission in a US oil field transaction. Continue reading

CFOs see earnings shenanigans in 20% of U.S. public firms

http://business.financialpost.com/executive/cfo/cfos-see-earnings-shenanigans-in-20-of-u-s-public-firms

CFOs see earnings shenanigans in 20% of U.S. public firms

James Saft, Reuters | September 25, 2015 2:06 PM ET

If you think the fact that a U.S. company’s earnings conform to accepted standards means they are to be trusted, then allow me to introduce you to the 20 per cent of chief financial officers who disagree. Continue reading

A February takeover bid for Barnes & Noble that sent the bookseller’s stock soaring was fraudulent because the firm behind the announcement lacked funding to do the deal, the SEC said

SEC alleges fraud in failed takeover bid of Barnes & Noble
25 September 2015
A February takeover bid for Barnes & Noble that sent the bookseller’s stock soaring was fraudulent because the firm behind the announcement lacked funding to do the deal, the Securities and Exchange Commission said Thursday. Continue reading

Fanya Exchange’s 36 billion yuan default ‘tip of iceberg’ in China; China investors in rare protest accuse regulators of “ignoring fraud”

http://www.scmp.com/print/news/china/economy/article/1861179/fanya-exchanges-36-billion-yuan-default-tip-iceberg-china

http://www.scmp.com/print/news/china/money-wealth/article/1861178/failed-china-financial-products-drew-investors-their-low

Fanya Exchange’s 36 billion yuan default ‘tip of iceberg’ in China

PUBLISHED : Friday, 25 September, 2015, 12:00am

Xie Yu yu.xie@scmp.com

Exchanges featuring products from garlic to rhodium are under scrutiny after Fanya metals case

Rhodium and steel to garlic and onion, you name it, they trade it. Hundreds of these so-called commodity exchanges, which have mushroomed across the mainland in a regulatory void and attracted 1 trillion yuan in investments, are now under the microscope. Continue reading

Oligarchs and Orchestras: Inside Luxembourg’s Secretive Low-Tax ‘Fortress of Art’ Warehouse; Fraud allegations against Swiss entrepreneur Yves Bouvier, have cast a shadow on Luxembourg’s and Singapore’s Le Freeport, a high-security, low-tax warehouse for art

Oligarchs and Orchestras: Inside Luxembourg’s Secretive Low-Tax ‘Fortress of Art’ Warehouse; Fraud allegations against Swiss entrepreneur Yves Bouvier have cast a shadow on Luxembourg’s Le Freeport, a high-security, low-tax warehouse for art
By John Letzing And Max Colchester
24 September 2015
SENNINGERBERG, Luxembourg—Last year, David Arendt stood in a reinforced concrete warehouse at Luxembourg’s airport and welcomed wealthy collectors to his “fortress of art,” complete with high security, minimal taxes and discretion. Mr. Arendt warned that it would fill up quickly. Continue reading