http://www.ft.com/intl/cms/s/0/2d3d8246-89b7-11e4-9dbf-00144feabdc0.html#axzz3MgzE825A
December 22, 2014 11:43 am
Hong Kong watchdog takes action against shortseller
Jennifer Hughes in Hong Kong
Citron Research has become the first shortseller to face action from Hong Kong’s watchdog, which alleges the California-based group knowingly made “false and misleading” claims about Evergrande, the Chinese developer. Continue reading
http://www.zerohedge.com/news/2014-12-21/meet-joe-lewis-200-million-british-madoff
http://www.ft.com/intl/cms/s/0/403d8c36-89e6-11e4-8daa-00144feabdc0.html#axzz3MgxREgZN
Meet Joe Lewis – The $200 Million “British Madoff”
Tyler Durden on 12/21/2014 18:15 -0500
In an oddly familiar echo of Bernie Madoff’s massive ponzi collapse, The Telegraph reports, a currency trader has vanished along with £130 million in investors’ cash in an alleged fraud that could be one of the biggest in recent British history. Joe Lewis, 59, is being investigated by police over almost $200 million which he claimed was in clients’ accounts (incluidng professional footballers and golfers) but now no longer exists. In a stunning email sent to clients 2 weeks ago, Lewis admitted that his company – JL Trading – had stopped operating in 2009 (after suffering heavy losses on disastrous FX trades), adding that “I have covered up my mistakes from everyone including my staff, no one else knew what was happening.” The father of two has since failed to answer emails and phone calls, and at his Istanbul apartment a doorman said he had not been seen for a few weeks. Continue reading
http://www.wsj.com/articles/china-investigates-possible-stock-price-manipulation-1419231997
China Investigates Possible Stock-Price Manipulation
Move Follows Recent Surge in Chinese Share Market
China’s markets regulator is investigating possible manipulation of the country’s stock market, following a recent surge in Chinese stocks. Here, a man flies a kite in Shanghai, with the city skyline behind. AGENCE FRANCE-PRESSE/GETTY IMAGES
LINGLING WEI
Updated Dec. 22, 2014 4:10 a.m. ET
BEIJING—China is investigating possible stock-price manipulation amid the recent run-up in the country’s equity market, according to officials with direct knowledge of the matter, a move that serves as a stark reminder of the problems that have long haunted Chinese stocks. Continue reading
http://fortune.com/2014/12/22/wall-street-sec-fsquared/?xid=nl_fortune
The fund that was too good to be true
DECEMBER 22, 2014, 6:00 AM EST
Money manager F-Squared used a hot ETF strategy to collect billions. But the numbers didn’t add up. Continue reading
http://www.wsj.com/articles/citigroup-was-wary-of-metals-backed-loans-1419194646
Citigroup Was Wary of Metals-Backed Loans
Bank Forged Ahead in a China Commodities Market Now Roiled by Fraud Allegations
CHRISTIAN BERTHELSEN and SARAH KENT
Updated Dec. 21, 2014 7:54 p.m. ET
LONDON— Citigroup Inc. pushed forward on a series of ill-fated metal financing deals in China despite internal warnings about the risks, leaving it exposed to losses that could take a big bite out of its growing commodities business. Continue reading
http://online.wsj.com/articles/accountants-increasingly-use-data-analysis-to-catch-fraud-1417804886
http://blogs.wsj.com/numbers/when-using-math-to-catch-crooks-you-cant-jump-to-conclusions-1870/
Accountants Increasingly Use Data Analysis to Catch Fraud
Auditors Wield Mathematical Weapons to Detect Cheating
JO CRAVEN MCGINTY
Updated Dec. 5, 2014 6:48 p.m. ET
When a team of forensic accountants began sifting through refunds issued by a national call center, something didn’t add up: There were too many fours in the data. And it was up to the accountants to figure out why. Continue reading
http://www.wsj.com/articles/india-analyst-is-jailed-after-negative-report-1418359350
India Analyst Is Jailed After Negative Report: Rare Arrest Seen Causing a Chill on Market Coverage
GEETA ANAND
Dec. 11, 2014 11:42 p.m. ET
GURGAON, India—Complaints filed by one of India’s biggest property and financial-services groups after a negative report about it more than two years ago have landed the report’s co-author, accountant Nitin Mangal, in jail.
The group, Indiabulls , says the report, which questioned its corporate governance and accounting, was full of lies and was used for extortion purposes. Mr. Mangal’s lawyer says the report was based on public information, was accurate and wasn’t used to try to scare money out of anyone. Continue reading
http://ww2.cfo.com/gaap-ifrs/2014/12/revenue-recognition-changes-spur-sec-fraud-probes/
Revenue Recognition Changes Could Spur SEC Fraud Probes
The new FASB revenue recognition standard means increased focus from auditors and likely unwanted attention from the SEC.
Nicolas Morgan and Shauna Watson, Contributors
December 12, 2014 | CFO.com | US
Throughout 2014, the Securities and Exchange Commission has signaled an increased focus on financial reporting fraud in general and revenue recognition in particular. In October, SEC Chair Mary Jo White said the SEC has seen a “significant jump” of more than 20% in enforcement actions in the area, and SEC Enforcement Director Andrew Ceresney called the area the “next frontier” for enforcement. Continue reading
http://www.wsj.com/articles/meet-the-secs-brainy-new-crime-fighters-1418601581
Meet the SEC’s Brainy New Crime Fighters: ‘Quants’ Are Agency’s Latest Weapon Against Financial Misdeeds
Lori Walsh, left, chief of the Securities and Exchange Commission Enforcement Division’s Center for Risk and Quantitative Analysis, with Howard Kaplan, a data analyst in the SEC’s enforcement division, in Washington. T.J. KIRKPATRICK FOR THE WALL STREET JOURNAL
SCOTT PATTERSON
Updated Dec. 14, 2014 10:39 p.m. ET
Long outgunned by Wall Street’s legions of Ph.D.s, the Securities and Exchange Commission is arming itself with mathematicians and computer programmers of its own to catch bad market actors.
The question is whether this is an arms race government regulators can hope to win.
The SEC is mustering its mathematical firepower in its Center for Risk and Quantitative Analytics, which was created last year soon after Mary Jo White took charge of the agency to help it get better at catching Wall Street misconduct. The enforcement unit, led by 14-year SEC veteran Lori Walsh, is housed deep within the warrens of the SEC’s Washington headquarters, and staffed by about 10 employees trained in fields such as mathematical finance, economics, accounting and computer programming. Continue reading
http://www.wsj.com/articles/sec-big-4-firms-make-progress-in-china-audit-dispute-1418685152
SEC, Big 4 Firms Make Progress in China Audit Dispute
Both Sides Say ‘Significant Time’ Needed to Discuss Potential Settlement
MICHAEL RAPOPORT
Dec. 15, 2014 6:12 p.m. ET
U.S. regulators and the Chinese affiliates of the Big Four accounting firms have made “substantial progress” toward settling their dispute over access to the firms’ audit documents, the two sides said Monday.
But Securities and Exchange Commission enforcement officials and the Chinese affiliates of the Big Four firms—PricewaterhouseCoopers, Deloitte Touche Tohmatsu, Ernst & Young and KPMG—say that while their progress toward a settlement has “increased significantly,” they still need “significant time and care” to discuss the potential pact, according to an order in the SEC’s administrative proceeding against the firms. Continue reading
AsianExtractor: Unearthing Accounting Fraud in Asia 