[Flashback] Pin Chakkaphak, one time hero of the Thai financial system, whose alleged massive siphoning-off of funds from his own business was seen as sparking the 1997 economic meltdown

bambooinnovator Leave a comment

http://www.nationmultimedia.com/politics/Prosecutors-did-their-best-30189460.html

http://www.nationmultimedia.com/national/Takeover-king-Pin-ends-exile-back-in-Bangkok-30189378.html

http://www-cgi.cnn.com/ASIANOW/asiaweek/magazine/2000/0623/ispin.june.html

http://www.theguardian.com/business/2000/dec/09/5

Thailand: Prosecutors ‘did their best’

3 September 2012

Thai News Service

Thai Fraud

Section: General News – Attorney General Praphan Naikowit on August 30 rejected claims that his office had failed in its mission to locate and seek the extradition of Pin Chakkaphak, whose alleged massive siphoning-off of funds from his own business was seen as sparking the 1997 economic meltdown, The Nation reports. Praphan defended public prosecutors after it was disclosed that Pin has returned to Bangkok following the expiry of the 15-year statute of limitations in his case. The Bank of Thailand accused Pin of collaborating with two others to embezzle Bt2.127 billion from his Finance One Group in 1996-97. Continue reading →

The Struggle to Simplify Accounting; The CECL (Current Expected Credit Loss) manner of incorporating forward-looking information creates a new earnings management tool in the Accounting for Debt Instruments

bambooinnovator Leave a comment

http://ww2.cfo.com/gaap-ifrs/2015/01/struggle-simplify-accounting
The Struggle to Simplify Accounting: Companies just don’t want to give up the flexibility to manage financial reporting that’s provided by the complexity of accounting standards.
Edward W. Trott
January 22, 2015 | CFO.com | US
Complexity in accounting is sometimes necessary when the transaction or economic event is complex. Some measurements will always be complex when there is the lack of significant observable data with which to make an estimate.
But much of the current complexity in accounting standards is unnecessary. This excess complexity is usually supported by CFOs and other corporate preparers of financial statements (who would most benefit from simplification of the standards) because of a desire to avoid the effort to undergo major changes in accounting standards. Continue reading →

Corporate fraud reports a 45 per cent increase in India: ASSOCHAM-Grant Thornton; companies related to real estate and infrastructure sector (52%) are considered to be the most vulnerable

bambooinnovator Leave a comment

http://www.merinews.com/article/corporate-fraud-reports-a-45-per-cent-increase-in-india-assocham-grant-thorton/15903512.shtml

Click to access Grant_Thortnon_Assocham_Fraud-A_key_governance_risk.pdf

Click to access Vidya-Rajarao.pdf

Corporate fraud reports a 45 per cent increase in India: ASSOCHAM-Grant Thornton

15 January 2015

Merinews

Dian corporate frauds arising out of corruption, money laundering, tax evasion, window dressing, financial reporting fraud and bribery have increased by over 45% in the last two years due to weakness in internal controls, scarcity of resources at disposal and over-riding powers of the senior management, according to an ASSOCHAM-Grant Thornton study. The joint survey by ASSOCHAM and Grant Thornton revealed that the companies related to real estate and infrastructure sector (52%) are considered to be the most vulnerable to fraud related incidences followed by financial services (34%), telecom (5%), manufacturing (3%), electronics and IT/ ITeS (2%), Hospitality and tourism (2%). Over 65% of our survey respondents agreed to witness a rising trend of wilful defaults and frauds. The survey observed that the lurking risk of frauds has been dissuading global companies from investing in India, points out the survey. Procurement frauds, payrolls frauds, asset misappropriation, financial misstatement, corruption, bribery, tax evasion, piracy, intellectual Property (IP) fraud, kickbacks, accounting frauds, counterfeiting, white-collar crimes etc are swiftly threatening business in both the private and public sectors, adds the report.

Continue reading →

India’s Satyam Scandal: Evidence the Too Large To Indict Mindset of Accounting Regulators is a Global Phenonmenon

bambooinnovator Leave a comment

http://eds.a.ebscohost.com.libproxy.smu.edu.sg/ehost/pdfviewer/pdfviewer?sid=03b2086b-bcdd-4ec1-b5b4-75b7d05ed90a%40sessionmgr4003&vid=0&hid=4202

INDIA’S SATYAM SCANDAL: EVIDENCE THE TOO LARGE TO INDICT MINDSET OF ACCOUNTING REGULATORS IS A GLOBAL PHENOMENON.

Pai, Kalpana1 kpai@txwes.edu
Tolleson, Thomas D.1 ttolleson@txwes.edu

Review of Business & Finance Studies. 2015, Vol. 6 Issue 2, p35-43. 9p.

Abstract:

This paper examines the capture of government regulators using the case of Satyam Computer Services Ltd., one of India’s largest software and services companies, which disclosed a $1.47 billion fraud on its balance sheet on January 7, 2009. The firm, which traded on the New York and Bombay Stock Exchanges, was required to file financial reports with the SEC. Price Waterhouse of India, the local member of PricewaterhouseCoopers (PWC), served as its auditor. After news of the scandal hit the airwaves, Price Waterhouse of India issued a press release and stated that its audit was conducted in accordance with applicable auditing standards and was supported by sufficient audit evidence. Because Satyam shares were quoted on Wall Street, SEC rules prohibited auditors from having business relations with their clients. U.S. regulators failed to take action against PWC. Is this lack of enforcement related to PWC’s size and the impact that the failure of a Big 4 firm would have on the global financial marketplace? We question whether government regulators have been captured by the key market players in the auditing services market. One outcome of this “capture” is moral hazard, which implies that the Big 4 accounting firms, or their local affiliates, may place less emphasis on quality audits. Such an approach to the audit function places the selfinterests of the audit firm above the public interest. We also question whether foreign companies that are listed on US Stock Exchanges fall under the purview of US Laws and if these companies and their auditors face the same regulatory scrutiny as publicly-traded US Corporations. In addition, the paper provides suggestions to protect the public interest while citing lessons learned from this scandal.

Aging Japanese Prove Rich Pickings for Investment Fraud

bambooinnovator Leave a comment

http://www.bloomberg.com/news/print/2015-01-21/aging-japanese-prove-rich-pickings-for-investment-fraud.html

Aging Japanese Prove Rich Pickings for Investment Fraud

By Masaaki Iwamoto – Jan 21, 2015

A growing number of retirees in Japan are falling victim to fraud, underscoring a downside of promoting personal investment in the world’s most aged nation. Combating the problem is a rising challenge for the government of Prime Minister Shinzo Abe, as it encourages Japanese households to shift more of their 1,654 trillion yen ($14 trillion) in assets out of savings accounts and into investments that boost the economy. Continue reading →

Escaping Detection: Why Auditors Do Not Find Fraud

bambooinnovator Leave a comment

http://www.sequenceinc.com/fraudfiles/2013/06/escaping-detection-why-auditors-do-not-find-fraud/​

Posted by CHEN Liting, Year 3 undergrad at the School of Business, Singapore Management University

Escaping Detection: Why Auditors Do Not Find Fraud

June 25, 2013

This article was originally printed in Valuation Strategies, a magazine published by Thomson Reuters.

Even with all the publicity surrounding the issue of financial fraud in the last decade, most auditors, investors, and other professionals still do not “get it” when it comes to detecting fraud. Traditional financial statement audits were never designed to detect fraud. Continue reading →

House Lawmakers Seek to Revive Bank Century Probe; illegal transfers of bank capital to controlling owners’ personal accounts contributed to Bank Century’s collapse

bambooinnovator Leave a comment

http://thejakartaglobe.beritasatu.com/news/house-lawmakers-seek-revive-bank-century-probe/

http://www.atimes.com/atimes/Southeast_Asia/KI17Ae02.html 

House Lawmakers Seek to Revive Bank Century Probe

By Markus Junianto Sihaloho on 08:36 am Jan 20, 2015

Not Over Yet Head of deposit insurance agency tells hearing legal woes led to loss-making sale

Bank Century

Former customers of Bank Century, now Bank Mutiara, demand justice at the KPK’s offices. (Antara Photo/Puspa Perwitasari)

Jakarta. Several lawmakers are pushing for the revival of a House of Representatives inquiry committee into the controversial bailout of the now-defunct Bank Century.

In 2008, the government forked over a Rp 6.7 trillion ($530 million) bailout to the ailing bank. Critics at the time said the revelation that wealthy donors to then-President Susilo Bambang Yudhoyono’s re-election campaign were among the bank’s clients raises questions of propriety, if not legality. Continue reading →

The Arena of Multi-Interest, Governance and Fraud: A Critical Review of Indonesia’s Bank Century Bailout

bambooinnovator Leave a comment

http://ruddyts.blogspot.sg/

THE ARENA OF MULTIINTEREST, GOVERNANCE AND FRAUD A CRITICAL REVIEW OF BC BAILOUT

Ruddy Tri Santoso, M. Hartono, M. Agung Prabowo, Guntur Riyanto, Sujoko Eferin, Yenny Tjiamudjaja

ABSTRACT

The bailout of PT. Bank Century (BC) at the end of 2008 ignites many debates. If the Indonesian Central Bank had not bailed it out, would it have been a systemic disaster for Indonesian economic? BCs total assets were not significant to the national banking asset. Why was it so important to bail BC out? This research wants to find answers to the following questions: 1) considering the internal problems of BC since 2005, was it worth to bail it out, and was the amount paid appropriate? 2) How bad was the internal problem in consideration of corporate governance theory, fraud theory, and in accordance with prudential banking principals? 3) Was the decision to bail out relevant for the national banking stabilization? 4) Was the failure of BC in 2008 a symptom of market failure, or a governance failure of BC and a regulation failure of the Indonesian Central Bank? This research uses descriptive qualitative method by in-depth analysis. The qualitative variables are classified to some significant factors which influence the decision to bail out. The result of this research shows that the historical performance, the corporate government and the fraud of the bank were not appropriately reviewed before the government decided to bail BC out. Even though the bailout was able to keep the national banking stabile at that time, the judgment of the decision was not purely economical. The non-economic factor was that the bank was too politically significant to fail.

Clawbacks Can Lead to Accounting Gimmicks

bambooinnovator Leave a comment

http://www.accountingtoday.com/news/accounting-news/clawbacks-can-lead-to-accounting-gimmicks-73365-1.html?zkPrintable=true

Related: Substitution between Real and Accruals-Based Earnings Management after Voluntary Adoption of Compensation Clawback Provisions (Link)

Clawbacks Can Lead to Accounting Gimmicks

WASHINGTON, D.C. (JANUARY 20, 2015)

BY MICHAEL COHN

The clawbacks on executive compensation mandated by the Dodd-Frank Act may discourage one type of accounting manipulation only to encourage another, according to a new study.

Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act contained a provision requiring all publicly listed companies to recover from executives any incentive compensation that was paid to them on the basis of erroneous financial statements. The Securities and Exchange Commission has still not determined exactly how the clawback provision will be enforced and it is not yet mandatory. But many companies have voluntarily enabled or required themselves to implement them. Continue reading →

Fraudsters will take advantage of UK pension reforms that give people more control over their retirement savings, industry figures and regulators fear. “It is a racing certainty that fraudsters are going to make hay in this environment”

bambooinnovator Leave a comment

http://www.ft.com/intl/cms/s/0/22c47776-9762-11e4-be9d-00144feabdc0.html#axzz3PQLDyFs1

January 16, 2015 1:47 pm

UK pensions reforms open door for scams

Judith Evans

Fraudsters will take advantage of reforms that give people more control over their retirement savings, industry figures and regulators fear. Continue reading →