Madoff had not been investing the money he was trusted with but he was using it to pay returns to other investors. Millions of people and thousands of hedge funds around the globe were affected when Madoff's Ponzi scheme was disclosed. It is hard to fathom that such a massive scam could run for decades with so much success and the only person responsible was Madoff himself. Some other people must have had some inkling of what was going on especially the auditors. Christopher Miller, chief executive of London hedge fund ratings agency Allenbridge Hedgeinfo, agrees that Madoff was not alone in running this Ponzi scheme: "Some very big investor names are involved in this. The scheme could...
Some of the world's biggest hedge funds have been hit by this. There will be a monumental impact for the hedge fund industry, it could be larger then Enron." (Carrey, 2008) The case has however proved that business scams did not end with Enron. People who thought auditing practices would improve and regulations would get stricter received a rude shock when Bernie Madoff ran off with their hard earned money.
Ethical Issues in Madoff Case Ethical Issues in Madoff Fraud Case The objective of this study is to identify the ethical issues and questions in the Madoff fraud case. This work will identify the people harmed and answer as to whether the scandal resulted from unethical individuals or if there are organizational issues that allowed, encouraged or were responsible for the harms. In addition, this study will answer as to what degree,
"And, then, all of a sudden, the bottom fell out of these companies. it's a reckoning." The question becomes: are there any honest and ethical business executives anywhere? Let's take a look. Former corporate CEOs like Richard Fuld of Lehman Brothers, faced down questions and cameras on Capitol Hill; former executives of the insurance giant AIG were also questioned. One topic of discussion: the fancy retreat hosted by AIG after an
Enron committed financial fraud prior to its collapse in 2001 by overstating its earnings and using mark-to-market accounting essentially to cook its books and dupe third-party auditing firm Arthur Andersen. Enron’s CFO Andy Fastow and its CEO Jeff Skilling used mark to market accounting to log future estimated profits as actual profits and a number of other financial fraud practices were used—such as creating shell vehicles to hide losses and
KPMG served as the independent audit firm of several of the largest subprime mortgage lenders. Identify the advantages and disadvantages of a heavy concentration of audit clients in one industry or sub-industry (40marks). KPMG did indeed serve as the independent audit firm of many of the most massive subprime mortgage lenders in the nation. There are concrete benefits and drawbacks to such strong relationships in on particular field. The most fundamental
The reality was that a company which aspired to be "the No. 1 stock on Wall Street" was instead steadily bleeding money while claim growth in the billions. The pressure placed upon accountants at WordCom was reflective of the pressure facing accountants throughout the economy during this period of widely absence securities oversight. Indeed, the relationship between regulation and accounting is essential, and this diminished link would have catastrophic implications
Labeling white collar crime is a mystery. A shared misapprehension of white collar crime is that, like pornography, it is hard to describe, however a lot of people would recognize it when they understood it. The only thing concerning white collar crime is that no profession is excused or unaffected by it (Geis, 2002). A person just needs to pick up the paper, observe the news, or go on
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