No Result
View All Result
SUBSCRIBE | NO FEES, NO PAYWALLS
MANAGE MY SUBSCRIPTION
NEWSLETTER
Corporate Compliance Insights
  • Home
  • About
    • About CCI
    • Writing for CCI
    • NEW: CCI Press – Book Publishing
    • Advertise With Us
  • Explore Topics
    • See All Articles
    • Compliance
    • Ethics
    • Risk
    • FCPA
    • Governance
    • Fraud
    • Internal Audit
    • HR Compliance
    • Cybersecurity
    • Data Privacy
    • Financial Services
    • Well-Being at Work
    • Leadership and Career
    • Opinion
  • Vendor News
  • Career Connection
  • Events
    • Calendar
    • Submit an Event
  • Library
    • Whitepapers & Reports
    • eBooks
    • CCI Press & Compliance Bookshelf
  • Podcasts
  • Videos
  • Subscribe
  • Home
  • About
    • About CCI
    • Writing for CCI
    • NEW: CCI Press – Book Publishing
    • Advertise With Us
  • Explore Topics
    • See All Articles
    • Compliance
    • Ethics
    • Risk
    • FCPA
    • Governance
    • Fraud
    • Internal Audit
    • HR Compliance
    • Cybersecurity
    • Data Privacy
    • Financial Services
    • Well-Being at Work
    • Leadership and Career
    • Opinion
  • Vendor News
  • Career Connection
  • Events
    • Calendar
    • Submit an Event
  • Library
    • Whitepapers & Reports
    • eBooks
    • CCI Press & Compliance Bookshelf
  • Podcasts
  • Videos
  • Subscribe
No Result
View All Result
Corporate Compliance Insights

The SEC’s Financial Fraud and Accounting Task Force

by Michael Volkov
March 7, 2014
in Uncategorized
The SEC’s Financial Fraud and Accounting Task Force

This article was republished with permission from Michael Volkov’s Corruption, Crime & Compliance.

shutterstock_131389106The SEC likes to reorganize, refocus and re-energize.  In the last 10 years, the SEC has continued to reinvent itself.  Whether it has been effective or not is still up for questioning.

Some have questioned if the SEC’s initiatives and reorganization have diverted it from monitoring bread-and-butter issues, such as financial fraud, particularly in the accounting area.

The SEC’s new chairwoman, Mary Jo White, has refocused the SEC on accounting fraud issues.  She created the Financial Fraud and Accounting Task Force.

Everyone recalls the WorldCom, Enron and Adelphia scandals from more than 10 years ago.  In reaction to these major accounting fraud scandals, the SEC created a task force to address accounting fraud.  The new task force has a much different mission – it is aimed at proactively identifying suspicious corporate accounting practices in order to prevent the recurrence of similar scandals.

The new SEC task force is built on the mantra of proactive enforcement.  It consists of a team of attorneys and accountants with significant financial fraud experience who are charged with understanding the origins of financial reporting fraud and trends needed to identify potential financial fraud, including revenue recognition, off-balance sheet transactions and revisions of financial statements.

In the area of enforcement, the task force will play a critical role in identifying potential cases for further investigation by the SEC’s Division of Enforcement.  Early investigations will allow the task force to identify potential targets, monitor their financial reporting, request and review documents and/or refer the matter, along with preliminary assessments, to the Division of Enforcement attorneys.

If identified as the subject of a financial fraud case, the task force’s inquiry will create interesting strategic responses by companies.  If identified by the task force, the subject company will have to investigate the matter quickly so that it understands the basis for the SEC’s concern.  From the company’s perspective, a proactive investigation, if accurate, can be an important way to avoid a massive financial fraud disaster.  The key in these cases will inevitably turn on the accuracy of the SEC’s determination that a company has engaged in or is likely to suffer from a financial fraud scheme.

The task force relies on several methods for identifying financial fraud.  The SEC’s Division of Economic and Risk Analysis uses the Accounting Quality Model (AQM) to identify potential issues.  AQM is not a cut-and-dried process.  It relies on text and data analytics.  Some fear that text analytics may result in a focus on disclosures and the accuracy of such disclosures.

The task force has a unique opportunity to refocus on cutting-edge ideas for identifying and preventing financial fraud.  It will form important theories and new approaches based on academic research and other sources of ideas.

The SEC has taken a lot of heat for its performance in the last 10 years.  Whether the latest reinvention has any merit will quickly be revealed in new enforcement actions for financial fraud.


Previous Post

New PCI DSS Goes Beyond Compliance

Next Post

The Top Three Bribery Risks in Latin America

Michael Volkov

Michael Volkov

Michael-Volkov-leclairryan Michael Volkov is the CEO of The Volkov Law Group LLC, where he provides compliance, internal investigation and white collar defense services.  He can be reached at mvolkov@volkovlaw.com. Michael has extensive experience representing clients on matters involving the Foreign Corrupt Practices Act, the UK Bribery Act, money laundering, Office of Foreign Asset Control (OFAC), export controls, sanctions and International Traffic in Arms, False Claims Act, Congressional investigations, online gambling and regulatory enforcement issues. Michael served for more than 17 years as a federal prosecutor in the U.S. Attorney’s Office in the District of Columbia; for five years as the Chief Crime and Terrorism Counsel for the Senate Judiciary Committee, and Chief Crime, Terrorism and Homeland Security Counsel for the Senate and House Judiciary Committees; and as a Trial Attorney in the Antitrust Division of the U.S. Department of Justice. Michael also maintains a well-known blog: Corruption Crime & Compliance, which is frequently cited by anti-corruption professionals and professionals in the compliance industry.

Related Posts

XM Cyber Acquires Cyber Observer

XM Cyber Acquires Cyber Observer

by Corporate Compliance Insights
June 30, 2022

Cloud security provider XM Cyber has acquired Cyber Observer in a deal that will expand XM Cyber’s platform to include...

executive data security retro concept

Executive Digital Hygiene: The Threat Is Coming From Inside the C-Suite

by Staff and Wire Reports
June 29, 2022

Never mind the risk of a board member leaving a folder of sensitive documents in the back of a taxi....

farm silo leaning over

Big Benefits of Advanced Tech for FinCrime Compliance Don’t Kick in Until Silos Are Toppled

by Sujata Dasgupta
June 29, 2022

Companies increasingly have the advanced tools to combat financial crime, but as industry specialist Sujata Dasgupta explains, the fragmented nature...

snooping on private data

Survey: Leaders Claim to Be Ready for State Privacy Laws; Few Actually Are.

by Staff and Wire Reports
June 29, 2022

With state laws looming, where do companies actually stand today? A Womble Bond Dickinson survey examined current corporate preparedness along...

Next Post

The Top Three Bribery Risks in Latin America

Compliance Job Interview Q&A

Jump to a Topic

AML Anti-Bribery Anti-Corruption Artificial Intelligence (AI) Automation Banking Board of Directors Board Risk Oversight Business Continuity Planning California Consumer Privacy Act (CCPA) Communications Management Corporate Culture COVID-19 Cryptocurrency Culture of Ethics Cybercrime Cyber Risk Data Analytics Data Breach Data Governance Decision-Making DOJ Download Due Diligence Enterprise Risk Management (ERM) ESG FCPA Enforcement Actions Financial Crime GDPR HIPAA Know Your Customer (KYC) Machine Learning Monitoring Ransomware RegTech Reputation Risk Risk Assessment SEC Social Media Risk Supply Chain Technology Third Party Risk Management Tone at the Top Training Whistleblowing
No Result
View All Result

Privacy Policy

Founded in 2010, CCI is the web’s premier global independent news source for compliance, ethics, risk and information security. 

Got a news tip? Get in touch. Want a weekly round-up in your inbox? Sign up for free. No subscription fees, no paywalls. 

Follow Us

Browse Topics:

  • CCI Press
  • Compliance
  • Compliance Podcasts
  • Cybersecurity
  • Data Privacy
  • eBooks Published by CCI
  • Ethics
  • FCPA
  • Featured
  • Financial Services
  • Fraud
  • Governance
  • GRC Vendor News
  • HR Compliance
  • Internal Audit
  • Leadership and Career
  • On Demand Webinars
  • Opinion
  • Resource Library
  • Risk
  • Uncategorized
  • Videos
  • Webinars
  • Well-Being
  • Whitepapers

© 2022 Corporate Compliance Insights

No Result
View All Result
  • Home
  • About
    • About CCI
    • Writing for CCI
    • NEW: CCI Press – Book Publishing
    • Advertise With Us
  • Explore Topics
    • See All Articles
    • Compliance
    • Ethics
    • Risk
    • FCPA
    • Governance
    • Fraud
    • Internal Audit
    • HR Compliance
    • Cybersecurity
    • Data Privacy
    • Financial Services
    • Well-Being at Work
    • Leadership and Career
    • Opinion
  • Vendor News
  • Career Connection
  • Events
    • Calendar
    • Submit an Event
  • Library
    • Whitepapers & Reports
    • eBooks
    • CCI Press & Compliance Bookshelf
  • Podcasts
  • Videos
  • Subscribe

© 2022 Corporate Compliance Insights

Welcome to CCI. This site uses cookies. Please click OK to accept. Privacy Policy
Cookie settingsACCEPT
Manage consent

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. These cookies ensure basic functionalities and security features of the website, anonymously.
CookieDurationDescription
cookielawinfo-checbox-analytics11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics".
cookielawinfo-checbox-functional11 monthsThe cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".
cookielawinfo-checbox-others11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other.
cookielawinfo-checkbox-necessary11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary".
cookielawinfo-checkbox-performance11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance".
viewed_cookie_policy11 monthsThe cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data.
Functional
Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features.
Performance
Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.
Analytics
Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc.
Advertisement
Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. These cookies track visitors across websites and collect information to provide customized ads.
Others
Other uncategorized cookies are those that are being analyzed and have not been classified into a category as yet.
SAVE & ACCEPT