Posted by Kimberly Culcay.

In the article, “What the PCAOB’s new related-party standard means for auditors,” Maria L. Murphy captures the new standard put in place by the Public Company Accounting Oversight Board (PCAOB). The new standard will require auditors to perform specific procedures that are intended to strengthen auditor performance in high-risk areas, such as significant unusual transactions and financial relationships, and transactions with executive officers. The reason behind the new standard is that in the areas of accounting mentioned above there was a lack of guidance on how to report or treat certain transactions.

The Auditing Standard (AS) No. 18 requires auditors to understand the relationships and transactions with related party transactions as if they were someone working in the company. The auditors must also understand and document the process of understanding the relationships and transactions of the company just as the internal controls of the company itself. The auditors not only have to record how they gained understanding of the relationships and transactions but the auditors must properly account for the transactions, perform procedures to test that the company’s related parties and transactions with those parties have been completely and accurately identified, accounted for, and disclosed. Before this standard, there was a vague and unstructured way of handling related party transactions. Related party transactions are a way that a company can commit fraud by transferring property to a related party thereby creating a conflict of interest. In the article, it also states that the AU Section 316, Consideration of Fraud in a Financial Statement Audit, was amended to require specific procedures to identify and evaluate significant unusual transactions. The main point of amending the standards is for the professional auditors to be able to identify procedures quickly if a situation of fraud exists.

I think amending the standards of accounting to include specific procedures to prevent fraud from happening rather than a professional figuring out what to do if fraud is already done is way more useful. I also think that with the incentive to have these procedures in place, it eliminates some of the gray area of accounting. The need for Forensic Accountants has increased ever since the recession in 2008, with all of the fraud that was done due to the lack of strict standards and procedures to be able to detect fraud early. I am currently a graduate student at Montclair State University; I have been striving to complete my combined program in Accounting BS/MS with a Certificate in Forensic Accounting. Personally, I find that in the emerging economy people have learned from the mistakes made in the past with the scandals, fraud and so on. I think it is important to be a Forensic Accountant in order to apply sophisticated set skills in other aspects of accounting and litigation. I think that if you already know how to be an accountant and with some background knowledge on Forensics, then it could be easier to detect some of the common problems that lead to fraud.

Kimberly is an accounting major with a certification in forensic accounting at Feliciano School of Business, Montclair State University.

Reference:  Murphy, Maria L. “What the PCAOB’s New Related-party Standard Means for Auditors.” Journal of Accountancy. 22 July 2014. Web. 20 Oct. 2015. .

Posted by Peyton Adams.

Avery was wrongly convicted for strangling Maryetta Griffin.  According to sources, Avery did not admit to the crime, and if he did, it was a forced confession.  However, the jury did not believe him.

The prosecution was able to sway the jury, which caused Mr. Avery to go to jail for SIX years. His image was severely damaged; he lost touch with his children and grandchildren due to being wrongfully convicted.

New DNA evidence surfaced proving that Avery was not the murderer of Maryetta Griffin.  Instead, the DNA testing was linked to Walter Ellis, a serial killer.  Avery was unjustly incriminated by the Milwaukee Police and Avery’s accusations of him not confessing, or confessing unwillingly were proved correct.

The police in this case, therefore, destroyed a man’s life by making up incriminating statements.  Avery lost touch with loved ones; his image was attacked; and he was ONLY awarded $1M.

John Stainthorp with Peoples Law Office in Chicago said, “If you think about it, six years while you’re in prison, you can’t get up when you want, you can’t see the people you want, go to bed when you want, read what you want.”  His life was ruined due to the fact that the police did not do the correct investigation to make sure that they had accused the correct man.

Mr. Avery was released after six years, but his life will never be the same AGAIN!  The Milwaukee Police should be questioned for the accusations they made in court against the plaintiff.

Peyton is a marketing major with minors in business law and nonprofit studies at the Stillman School of Business, Seton Hall University, Class of 2019.

Teachers in Michigan are testing the new Right-to Work law by deciding whether to stay in their union.  Michigan has one of several Republican-controlled legislatures that passed laws making union membership and dues voluntary.  Many of the 112,000 active members have until the end of August 2014 to decide whether to stay.  About 1,500 left the union last August during an early opt-out period.  Some teachers feel that the $1,000 spent in union dues per year would be better saved since oftentimes teachers work several years without a raise in salary.

Michigan’s new law has not affected the state’s other unions yet as their collective bargaining agreements will not reach the opt-out period until 2015.  Proponents of the law say that it increases workplace freedom and helps attract business.

Since 2011, more than one-third of Wisconsin’s teachers dropped their union.  In contrast, Alabama, which is also a right-to-work state, has been able to retain about 80 percent of their members.

Posted by Kimberly Culcay.

In the article, “What Types of Legal Cases Require a Forensic Accountant,” Henry Rinder describes what a forensic accountant really is and the need for such a professional. The article discusses that there is a difference between a traditional accountant and a forensic accountant. A forensic accountant combines accounting knowledge and legal expertise to help their clients, from individuals to small and large businesses. The forensic accountant is a person that exhibits a curiosity that allows him or her to figure out if a company is hiding something. Some of the legal cases that require forensic accounting are criminal investigations, fraud, shareholder disputes, and divorce. For example, it is common in divorce cases for one party to hide assets to prevent splitting up everything they have.

In criminal investigations forensic accountants help find key elements to help law enforcement officers investigate crimes. Forensic accountants have some duties when being involved in criminal investigations, such as analyzing personal and business documents, tracing and recovering hidden assets, and tracking and reconstructing transactions and wire transfers. From the information provided above, it is easy to see that the need for forensic accountants in the field is growing rapidly. Fraud is something a traditional accountant may stumble upon in their career, but a forensic accountant is a person whose job is to detect it. As stated in the article, some of the duties forensic accountants have when helping with fraud investigations are detecting employee theft and fraud, investigating embezzlement, looking for inconsistencies in financial filings, assessing financial losses, and assisting with insurance claims and restitution orders or agreements.

Fraud falls under the investigative side of a forensic accounting because in a sense the accountant is acting as a detective. The other side of a forensic accountant is they can testify as an expert in court. Personally, I never expected for a forensic accountant to be involved in divorce cases, however if makes sense that a forensic accountant will usually assist in dividing assets and other valuables owned by one or both spouses during the marriage. Asset tracing is a key way for a forensic accountant to detect if someone has tried to conceal assets. Amongst others, some of the duties forensic accountants have helping with divorce cases are evaluating a spouse’s personal and business statements, tracing assets, debts, income, determining the value of concealed assets, ensuring equitable distribution and helping with divorce negotiations. Overall, the forensic accountant is there to help a spouse so that he or she has an opportunity for a fair and equitable distribution of the assets.

I think that with the evidence presented in this article it is evident that there is a need for forensic accountants in legal cases when it relates to finances. Forensic accounting is interesting to me because I always wanted to be a detective, but I knew that the job market was not going to consistent.  Therefore, it is exciting to find out that forensic accountants can serve the public in this way.

Kimberly is a graduate forensic accounting student at the Feliciano School of Business, Montclair State University.

Reference: Rinder, Henry. “What Types of Legal Cases Require a Forensic Accountant.” Smolin Lupin. 7 Oct. 2014. Web. 21 Oct. 2015. .

Posted by Melissa Nomani.

Farmers across the United States are filing suits against Syngenta. As stated in the article, “The lawsuits allege the biotechnology company’s genetically modified Agrisure Viptera and Duracade seeds contaminated US corn shipments, making them unacceptable for export to China.” China does not allow the importation of GMO products that it has not tested. In February of 2014, China learned that the corn shipments from the U.S. contained Viptera. Agrisure Viptera is a seed that is genetically modified (known as MIR162) to prevent damage to crops by earworms and cutworms. As a result, China has rejected corn imports from the U.S.

Over 1,800 suits have been filed. Lawsuits filed against Syngenta state that the company put seeds on the market even though there was no approval from foreign markets. This has led to some farms having great financial losses. Even farmers who do not use GMO seeds could be affected due to accidental contamination from other fields. Syngenta has tried to refute the lawsuits by stating that they are not responsible for protecting farmers from GMO seeds. This arguments were rejected in September by Judge Lungstrum, who refused to dismiss the suits.

It has been estimated by The National Grain and Feed Association that as of April 2014 almost $3.0 billion worth of losses were caused by Syngenta’s Agrisure Viptera MIT162 corn seed.

The first of the lawsuits are expected to go to trial in June 2017.

Melissa is a finance major at the Stillman School of Business, Seton Hall University, Class of 2018.

Online fraud is alive and well. About 4,550 people have been scammed by foreigners posing as IRS personnel and telling them they are about to be sued for unpaid taxes. The Treasury Inspector General, J. Russell George indicated they are working on bringing to justice the perpetrators of “‘the largest of its kind’” scam, yet taxpayers are urged to remain on “‘high alert.’”

According to George, a scammer will call an unsuspecting individual, claiming to be from the IRS. The “scammer tells the person that they have unpaid taxes and threatens him or her with a criminal violation, immediate arrest, deportation or loss of a business or driver’s license unless they settle the fees via a debit card or a wire transfer.” People have a hard time telling whether the call is legitimate because the scammers either use a robocall machine that leaves a message stating it is the IRS and they are being sued, or callers giving the last four digits of the victim’s social security number, or fake emails appearing to come from the IRS.

One of the ringleaders officials caught, Sahil Patel, is serving a 14 year sentence in federal prison for organizing call centers based in India, as part of the U.S. side of the scam.

Posted by Charles Batikha.

Tamira Fonville was a Mesa Airlines employee and part time recruiter for a hair show, but these were both false lives that Fonville was leading. Fonville spent her time along the east coast from New York to Washington D.C. trying to lure women to expose their financial information by fraudulently posing as a hair show recruiter wanting to hire young women. Unfortunately, there was no show and Fonville was not a recruiter, nor an airline employee. By the end, she caught herself in an addiction she could not stop, between signing off bouncing checks and scamming women; she was bound to get caught.

Ricardo Falana was Fonville’s assistant.  Before the banks would know what was happening, they both would wipe accounts clean. Foneville would ask the girls for their bank account information, lying, saying she wanted to deposit checks into their account. Once the checks were deposited, the account would be emptied before the banks could be any wiser. For individuals that were too smart to be scammed, Tamira would offer them a piece of the pie. These individuals were even “coached” to lie to bank employees, telling them their credit cards had been stolen. The problem was the piece of the pie that they were waiting for never came. After some time, these women came forward as victims.

Young women were not the only ones that Fonville scammed. She applied for a car loan under the impression of being an employee of Mesa Airlines with a $65,000 salary. Tamira used $30,000 to pay for her Chevy Camero, plastic surgery and her New York apartment. While she was living this lavish life, Fonville also was living off food stamps, while having her student loans, totaling up to $100,000, deferred.

Tamira was arrested in August 2014, said to have profited over $200,000 from the scams. She was sentenced 15 months for conspiracy to commit bank fraud as well as 3 cases of bank fraud. Falana, Tamira’s assistant, was sentenced to 80 months after pleading guilty to similar bank fraud charges.

Charles is a graduate accounting student with a certificate in forensic accounting at the Feliciano School of Business, Montclair State University.

The President signed into law a bill passed by Congress banning U.S. imports of “fish caught by slaves in Southeast Asia, gold mined by children in Africa, and garments sewn by abused women in Bangladesh.” The law closes a loophole in an 85-year-old tariff law which allowed these products to be sold.

Due to high demand of certain products, the previous law allowed these goods to be sold in the U.S. regardless if they were produced by slave labor. Sen. Sherrod Brown has pressed U.S. Customs to make sure the law is enforced.  He said, “It’s embarrassing that for 85 years, the United States let products made with forced labor into this country, and closing this loophole gives the U.S. an important tool to fight global slavery.”

Posted by Michael Larkin.

When one checks into a hotel, one would expect to have their information stored in a company’s database, but one would not expect that database to get compromised. Wyndham Worldwide Corporation was using a property management system that stored customer’s names, addresses, and credit card number. On three separate occasions in 2008 and 2009, Wyndham was hacked and this information was pulled off of over 600,000 accounts. Damage was approximately $10.6 million and the Federal Trade Commission (FTC) brought Wyndham to trial.

Even though Wyndham was the company that got hacked, it was the customers who got hurt and that is why the FTC filed against Wyndham. The FTC argued that the hacks were caused due the very limited security that the management system used. It was found that the credit card numbers could easily be read, passwords were easy to guess, and a firewall was not deployed along with various other issues. Wyndham argued that the FTC had no right to file a suit against them and that the unfairness and deception claims were not sufficiently validated. It was founded that Wyndham didn’t provide a fair system for its customers and the court required the company to change in order to protect its customers. Mainly, Wyndham needs a more comprehensive security program in order to protect account information and also conduct annual information security audits and maintain a safeguard for its servers.

This case was a matter of protection and privacy for the company’s customers. A customer is providing personal information in order to engage in business so Wyndham has a duty to protect that information. Having a higher security will ensure that hackers will not be able to breach the system and steal information. The FTC won the trial, and in doing so, made sure that a company had a high security to protect the customers.

Michael is a finance major at the Stillman School of Business, Seton Hall University, Class of 2019.

Sources:

FTC v. Wyndham Worldwide Corp.

Verdict From: https://www.ftc.gov/news-events/press-releases/2015/12/wyndham-settles-ftc-charges-it-unfairly-placed-consumers-payment

Research proposal posted by Brian Kane.

In the digital age, the rights and laws regarding privacy are being contested now more than ever. Today personal privacy, both digital and physical, is being discussed. One of the earliest examples of privacy laws in the United States is the 4^th amendment. Under this amendment gives “the right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures” (Fourth Amendment, U.S. Constitution). This and other laws, including the Federal Wiretap Law of 1968, are designed to protect the individual against unlawful searches of personal property by an unfair government. The individual right to privacy is held sacred in this country.

However, the laws of privacy protection are not absolute. Communications and interactions in general areas, such as online chatrooms, and digital communication used for work. Surveillance monitoring by employers has been contested by employees in courts in multiple cases. In City of Ontario, California v. Quon, for example, a search was justified because there were “reasonable grounds” and done “for a non-investigatory work-related purpose” (Ontario v. Quon).

Some argue that the privacy laws are for the best interests of individuals. Individuals and consumers are protected when the monitoring parties have clearly defined limits and barriers. When the government requires search warrants and the corporations are required to obtain consent, the best interests of those being monitored are kept in mind. The constant surveillance by powerful entities removes the right for individuals to act freely and live their own lifestyle. Gratuitous monitoring dehumanizes the employee and implies guilt without any evidence.

Privacy law is not completely virtuous, however. Like all laws, some may seek to exploit privacy law and use it to shield unproductive, immoral, and unethical behavior. When employees use corporate email accounts for personal business, they often claim a right to privacy when investigation begins. Many act recklessly online in this digital age, assuming that the right to privacy is absolute and unbreakable. There are instances where there is legitimate reasons to investigate an individual. When there is probable cause, public good supersedes individual privacy.

The issue of privacy and surveillance laws raises many ethical questions. The rights of individuals and the definition of individualism is put into question when anyone is monitored by a third party. There is concern for the maintenance of human dignity, as some see these searches dehumanizing and distressing on private lives. Pope Leo XIII spoke out against increased surveillance, saying that it intruded and lead to control over individuals. In Catholicism, the holy sacrament of confession revolves around the private recounting of sins and transgressions. When discussing privacy, the matter common good is raised. Aquinas believes that law is created for the common good, “made by him who has the care of the community and promulgated” (2 Bix).

Privacy and Surveillance Law is a widely contested issue in the catholic faith and general ethics. It has its advantages and disadvantages, as any other issue in law, but it will continue to be contested as new innovations shape the information age.

Works Cited

Bix, Brian H. “Secrecy and the Nature of Law.” October 2013. University of Pennsylvania School, Center for Ethics and the Rule of Law. Web. 3/3/2016. Avaliable: https://www.law.upenn.edu/live/files/2418-bixsecrecy-and-the-nature-of-law-full

City of Ontario v. Quon. 560 U.S. 746. Accessed 3/3/2016.