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ACCT 572 Research Project

Frauds are reported in local and national newspapers on an almost daily basis. Please
consider several resources, and research any notable fraud case to address the topics noted
below.

Then, please write an analysis (2,0003,500 words) that analyzes this fraud in relation to
the course material.

In your paper, you should

1. describe and analyze how the fraud was executed;

2. identify and briefly discuss the role of the parties that were involved as perpetrators,
accomplices, victims, tipsters, observers, and so forth (preferably in a chart or
illustration) [include Jeffry Picower];
3. assess the motives (or possible motives, if not reported) of each perpetrator;
4. identify controls that might have deterred or prevented the fraud from occurring;
5. discuss any involvement of the SEC;
6. document how the fraud was discovered and investigated, including what should have
been identified as red flags;
7. discuss the resolution of this case; and
8. cite and reference any articles, other texts, journals, websites, or so forth that you used
as a source for the facts in your paper. NOTE: Avoid Wikipedia, because it is not
recognized as a credible, authoritative source.
Grading Rubrics

Category Points % Description

This consists of two paragraphs providing a
First Draft or First
25 15% short description of the fraud you choose as the
Deliverable
subject of your Research Project.
Documentation Paper should follow designated guidelines.
10 6%
and Formatting Citations and references are used appropriately.
Category Points % Description
Organization and Structure of the answers is clear and easy to
10 6%
Cohesiveness follow.
Grammar and spelling is correct. Sentence
Editing 10 6%
structure is appropriate.
Content is comprehensive and accurate. Major
points are adequately stated and address
Content 115 67%
course concepts. Content and purpose of the
answers is clear.
A quality paper will meet or exceed all of the
Total 170 100
above requirements.

Description of Fraud Bernie Madoff

Bernie Madoff grew up in New York City. While growing up in New York there was one
thing on his mind that was a driving force behind what he did and that was his desire to be
rich. Bernie decided that Wall Street was where he needed to be to make the kind of
money he wanted. After completing college in 1960, he began to work his way into the
tight group of people that he believed ran Wall Street. He did this by creating his own
brokerage firm, Madoff Securities

Bernie Madoff was able to pull off one of the largest and longest running Ponzi schemes in
history. Bernie Madoff was a wealthy, prominent, industry insider, who perpetrated his
scheme on unsuspecting investors beginning in 1992. Between 1992 and 2008 the SEC
received six complaints against Bernie Madoff and his company and did investigate him.
Each time Bernie Madoff somehow passed the investigations and proceeded with his
scheme. It was not until 2008 when he could no longer keep up with the fraud because of
the down turn in the economy he was forced to confess. (U.S. Securities and Exchange
Commission Office of Investigation, 2009).

After the public display of the SECs failure to discover the Ponzi scheme by Madoff, despite
the six complaints, the SEC conducted an internal investigation to try and determine why
they failed defect the fraud during their investigations. The SEC report found that the
investigation were no complete, lack of communication, not enough resources and
expertise, and lack of proper processes and controls. Additionally, the report found that
there were no impropriety in their handling of the cases and no attempt by senior officials
to influence the investigation. However, it was found that SECs examination of Bernie
Madoffs company was done with too much caution because of who he was and his status
in the investment world.

Reference:

Bernard Madoff. (2015). The Biography.com website. Retrieved Mar 12, 2015,
from http://www.biography.com/people/bernard-madoff-466366

Rjrock. (2012, September 5). The SEC and Madoff: The Need for Authentic Leadership
in Regulatory Agencies. Retrieved March 12, 2015,
from http://journey24pointoh.com/2012/09/05/the-sec-and-madoff-the-need-for-
authentic- leadership-in-regulatory-agencies/#_ENREF_10