Posted by Bridget Uribe.

During the summer of 2015, one of the world’s most known Japanese companies broke headlines as a top accounting scandal. Investigators found the company was overstating operating profits by at least 151.8 billion yen ($1.2 billion in U.S. dollars) between the years of 2008 and 2014. Their accounting problems primarily began from company employees understating costs on long-term projects, according to an investigation by a former top prosecutor in Japan.

The investigation also cited issues with improperly valued inventory also as the cause for the enormous overstatement of operating profits. Details of the scandal emerged when an independent investigative panel released a report describing, “Toshiba CEOs put intense pressure on subordinates to meet sales targets after the 2008 global recession.” The investigative report revealed that the CEOs did not directly instruct anyone to cook the books but rather placed immense pressure on subordinates and waited for the corporate culture to turn out the results they wanted. The investigative panel also pointed out that the weak corporate governance and a poorly functioning system of internal controls at every level of the Toshiba conglomerate didn’t mitigate or stop the inappropriate behaviors. Internal controls in the finance division, the corporate auditing division, the risk management division, and in the securities disclosure committee were not functioning properly. The accounting misconduct began under CEO Atsutoshi Nishida in 2008 due to the global financial crisis that immensely lowered Toshiba’s profitability. It continued unabated under the next CEO, Norio Sasaki, and eventually ended in scandal under Tanaka. Toshiba CEO Hisao Tanaka announced his resignation, in light of the scandal.

It has been four months since the scandal broke headlines and much new information has come to light. Since then, Toshiba has amended and restated those losses as to being more than $1.9 billion. As a consequence of the scandal, the Tokyo Stock Exchange has already designated Toshiba’s shares as “securities on alert” and fined the company $760,000 for “undermining the confidence of shareholders and investors.” In addition, Toshiba also faces the possibility of lawsuits from angry shareholders in Japan who have seen the company’s share price tumble.

Such action is already being taken in the United States, where an investor has filed a class-action lawsuit against Toshiba in June. The Rosen Law Firm representing the plaintiff has called for other Toshiba shareholders to join the suit. Despite the consequences Toshiba is facing, the one burning question has yet to be solved. Who did this? How did all this came about? How could their fraud be maintained for so long, and who should take direct responsibility?

Bridget is a graduate forensic accounting student at the Feliciano School of Business, Montclair State University, Class of 2016.

Posted by Kevin Pereira.

This past Thursday, the F.B.I. arrested Benjamin Wey at his home located in Manhattan. He was charged for “securities fraud, wire fraud, conspiracy and money laundering in an eight-count indictment unsealed in a federal court in Manhattan.” In addition, Mr. Wey had already been arrested for sexual harassment a couple months prior to this incident. Mr. Wey was making Chinese companies public in the United States using a process known as a reverse merger. To explain, a reverse merger is a way for private companies to go public by buying the “shell” of a public American company.

Mr. Wey fulfilled this fraud by involving his family members and close friends. He portrayed the Chinese companies he was taking public to be mature and prosperous so that inventors were fooled into thinking that they were successful corporations in the NASDAQ stock market. Therefore, many clueless investors were investing into these masked corporations, which were being upheld by his family members. In addition, Mr. Wey’s banker, Seref Dogan Erbek, was helping falsify the “sales, volume, demand and price of the shares of the companies they took public.” The SEC in a civil complaint charged Mr. Erbek, Mr. Wey’s wife, his sister, and two lawyers as being part of the fraudulent matter.

Mr. Wey was inflating the prices of the shares by trading them between his family and friends. By doing this, the sudden increase in price attracted many eager investors. Once Mr. Wey had an audience, he would sell the inflated shares and generate millions of dollars. The money he was making would be sent to bank accounts offshore in Japan and Switzerland. Mr. Wey’s family members would then transfer the money back into the United States, stating it was a gift.

Kevin is a marketing major at Seton Hall University, Stillman School of Business, Class of 2018.

Posted by Katie Kim.

On Thursday, Martin Shkreli, a 32 year-old pharmaceutical executive, was arrested by the federal authorities on securities and wire-fraud charges stemming from an alleged Ponzi scheme he ran as a hedge-fund manager. What the young executive was doing was taking out loans from investors to start a new pharmaceutical company and using that money to pay off his debt from his hedge-fund. Martin Shkreli committed “fraud in nearly every aspect of hedge-fund investments and in connection with his stewardship of a public company,” said the director of enforcement at the Securities and Exchange Commission, Andrew J. Ceresney.

Shkreli was already notorious for price-gouging during his time at Turning Pharmaceuticals. His idea was to acquire decades old drugs and raise the price of it to $750 from $13.50 per pill. The current charges are not related to Shkreli’s work as chief executive of Turing Pharmaceuticals.

The federal authorities say that Shkreli was running three schemes that had connections to one another, he defrauded investors and used stock and cash from an unrelated pharmaceutical company to cover up the money he lost. The Brooklyn US attorney filed a seven-count criminal indictment and the Securities and Exchange Commission filed a related civil complaint on alleged securities fraud against Shkreli. Federal officials painted Mr. Shkreli’s business dealings as “a securities fraud trifecta of lies, deceit and greed.”

Shkreli was released on a $5 million bail, secured by a bank account and his father and brother. The authorities also arrested Evan L. Greebel who served as an outside counsel to Retrophin, the company Shkreli previously worked for. Shkreli treated Retrophin like his “personal piggy bank” where he used $11 million to pay back shareholders of MSMB funds.

Katie is an accounting/finance major at the Stillman School of Business, Seton Hall University, Class of 2018.

Posted by Ali Paladino.

Recently, on September 1, 2016, the electric car maker Tesla Motors was called out for attempting to sell their vehicles directly to their customers in Missouri. The judge ruled Tesla’s efforts to rule out the middleman, car dealerships, violated state law.  The Missouri Revenue Department “gave the California-based manufacturer a license for a University City dealership in 2013 and a franchise license for a Kansas City dealership in 2014.” Both of these licenses allowed Tesla motors to sell their vehicles directly to their customers, disregarding any use of dealerships.

The court ruled this was not suitable, and Missouri Automobile Dealers Association agreed. The Association sued the State claiming that “it had given Tesla special privileges,” in their attempts to disregard using franchised dealerships to sell their vehicles. The court ruled that Tesla’s action was not technically unconstitutional, but held the licensing was not allowed. Tesla argued the ruling against them was going to damage the company and suppress their ability to compete with other motor vehicle companies. The company also argued the order was an “attempt” to “limit consumer choice in Missouri.” Yet, Tesla appears to be determined to try and continue to sell to their customers directly in the hopes that this will improve their bottom-line. Doug Smith, head of the Dealers Association, however, does not agree with Tesla’s actions and believes that it is not fair to other manufacturers. He believes all manufacturers should be “treated the same in Missouri.”

I have to agree with Doug Smith. I do not think Tesla should have the right to sell directly to their customers and completely bypassing dealerships, only because it puts the company on a different playing field than other motor vehicle companies. I do not believe that is fair.

Tesla has looked at other ways to get around laws in other states in order to improve their sales; however, I do not agree with this either. In this situation, the law stands blurry and unclear and it is intriguing to see how far Tesla will go in attempts to get around the law.

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

Under Article I, Section 8 of the United States Constitution, the Congress has the power to “declare War, grant Letters of Marque and Reprisal, and make Rules concerning Captures on Land and Water[.]”  The Founders wisely thought that the Legislature is in a better position than the President to carry out the will of the people.  Congressional debate can test the arguments for and against intervention in global problems.  Every two years members of the House are kept in check by the voters, who ought to dictate what American foreign policy should be.

James Madison, commonly referred to as “Father of the Constitution,” once said:

Of all the enemies to public liberty, war is, perhaps, the most to be dreaded, because it comprises and develops the germ of every other.  War is the parent of armies; from these proceed debts and taxes; and armies, and debts, and taxes are the known instruments for bringing the many under the domination of the few.  In war, too, the discretionary power of the Executive is extended; its influence in dealing out offices, honors, and emoluments is multiplied; and all the means of seducing the minds are added to those of subduing the force of the people.  The same malignant aspect in republicanism may be traced in the inequality of fortunes and the opportunities of fraud growing out of a state of war, and in the degeneracy of manners and of morals engendered by both.  No nation could reserve its freedom in the midst of continual warfare.

Under the War Powers Resolution, the President can deploy U.S. forces anywhere outside the U.S. for 180 days, provided Congress is informed in writing within 48 hours.  The executive does not need Congress to declare war for the 180 days, however, that time period cannot be extended without congressional authorization.  The President has the authority to introduce American forces into hostilities only when there is:

(1) a declaration of war

(2) specific statutory authorization, or

(3) a national emergency created by attack upon the United States, its territories or possessions, or its armed forces.

The Supreme Court has never reviewed the War Powers Resolution to see if it passes constitutional muster.  Although Congress will say that it has “the power to make all laws necessary and proper for carrying into execution, not only its own powers but also all other powers vested by the Constitution in the Government of the United States, or in any department or officer . . . [,]” the Court, however, has ruled in other cases that one branch of government cannot give power away to another.

Posted by Devaki Sidhaye.

Recently department of Justice announced largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 individuals, including 115 doctors, nurses and other licensed medical professionals. Their involvement in health care fraud scams totaling approximately $1.3 billion in false billings. As per the department, many of the charges were related to medical professionals illegally prescribing opioids and other prescription narcotics, some of which were then sold on the street. Furthermore, according to federal officials, a rehab facility in Palm Beach, Fla., recruited addicts with gift cards, drugs and visits to strip clubs, billed the government for over $58 million in false treatments and tests. A clinic in Houston allegedly gave out prescriptions for cash. Some falsely billed Medicare and Medicaid. Narcotics officers have arrested schoolteachers, doctors, nurses and fellow law enforcement personnel (Merle, 2017).

According to the Centers for Disease Control and Prevention, approximately 91 Americans die every day of an opioid related overdose. Attorney General Jeff Sessions said at a news conference that, “One American dies of a drug overdose every 11 minutes and more than 2 million Americans are ensnared in addiction to prescription painkillers.” He further said in assurance that, “We will continue to find, arrest, prosecute, convict and incarcerate fraudsters and drug dealers wherever they are.” Health and Human Services Inspector General Daniel Levinson added that, “Health care fraud is a reprehensible crime, it not only represents a theft from taxpayers who fund these vital programs, but impacts the millions of Americans who rely on Medicare and Medicaid” (Merle, 2017).

This approaches a larger debate about how the country should address the government estimates are addicted to opioids. Public health authorities urge doctors to cut back on the prescriptions they offer. States struggling with the shortage of treatment has proposed roll back of the Affordable Care Act’s expansion of Medicaid (Merle, 2017).

This crisis represents a massive public health challenge that requires a broad-based, multi-pronged response from public health agencies and law enforcement. Physicians, pharmacists and citizens all can play a role in identifying and preventing nonmedical use of prescription drugs. Doctors and other healthcare professionals who prescribe these drugs need to be educated about responsible prescribing of opioids and about safe, effective alternatives that are not addictive and presently available (Young, 2016).

Even though law enforcement officials use advanced investigative methods to uncover the different actions health care fraud happens, they can’t fight these crimes alone. Individual can help remove these people responsible for wrongdoings by protecting their health insurance identification number, social security number, looking through the statements for medical services he didn’t receive, and reporting to authorities on recognizing the signs of possible fraud (Outreach, 2012).

For the protection of each person of the country as well as for the economic strength it is essential to destroy all traces of health care fraud. Health care frauds damage billions of dollars of the nation; mislead general public in the courses of actions, and innocent people become victims of white-collar crime.

Devaki is an MS Accounting student at the Feliciano School of Business, Montclair State University, Class of 2018.

References:

Merle, S. H. (2017, 07 13). DOJ announces charges against 400 people for $1.3 billion in health-care fraud. Retrieved from www.washingtonpost.com: https://www.washingtonpost.com/news/business/wp/2017/07/13/doj-announces-charges-against-400-people-for-1-3-billion-in-health-care-fraud/?utm_term=.f9b959fbfea6

Outreach, E. &. (2012, 04 23). How to Protect Yourself From Health Care Scams. Retrieved from www.aarp.org: http://www.aarp.org/health/medicare-insurance/info-10-2010/fightfraud.html

Young, L. (2016, 03 04). There’s no debate – America’s opioid epidemic is undeniable. Retrieved from www.pennlive.com: http://www.pennlive.com/opinion/2017/09/heres_what_you_need_to_know_ab_5.html

Research proposal posted by Jessica Thomulka.

Part One

Healthcare costs are skyrocketing in the United States. Even prior to the passing of President Obama’s Affordable Care Act, the burden on American corporations to provide healthcare to their employees was placing stress on businesses. Lifestyle control is the term given to an employer’s influence on an employee’s actions outside of the scope of their duties as an employee. Some of the most common examples of lifestyle control revolve around the preventative measures to lessen the pressure of the paying for employee medical coverage. The two most costly medical conditions are complications arising from smoking and obesity. The National Business Group on Health reports that obese employees cost employers $700 more than their average-weight employees, annually, for their healthcare. Along with healthcare, another aspect of business that employers are concerned about is productivity. In a 2002 study, the Center for Disease Control reports that productivity losses associated with workers who smoke cigarettes are estimated to be $3,400 per smoker.[1] Business owners and executives are concerned with maximizing their profits and ensuring the health of their company, and by keeping their employees healthy, they can reduce their risk of paying high medical expenses for preventable diseases. Some states like New York have passed provisions to prevent employer discrimination against an employee’s “after-hours” conduct, however there is no federal statute.

Part Two

There are both pros and cons to the idea of employers having control of the lifestyle of their employees. The stakeholders involved include the employer, the employees, the family of the employees, and even the ‘vice’ industries that the employers are safeguarding against such as the tobacco and gambling industries. The employers reap the most positive benefits out of lifestyle control provisions. They lower their cost and increase their productivity. The employees may also benefits from such provisions due to increased health, but they give up some of their freedom in the process. Some companies also impose lifestyle control upon the employee’s family if they are on the same health insurance policy so likewise, they may gain health benefits but sacrifice some of their freedom. Lastly, ‘vice’ industries suffer the most from lifestyle controls because they ultimately lose business due to embargos on acts like smoking and gambling. If enough companies impose lifestyle controls they could potentially bankrupt ‘vice’ industries.

Part Three

The biggest ethical question regarding lifestyle control is the autonomy of the employee. Should an employee be free from external control or influence by the employer? According to the United States Conference of Catholic Bishops (USCCB) there are several themes of Catholic Social Teaching.[2] Rights established in the Catholic tradition have an impact on lifestyle control. While privacy is not explicitly protected under the United States Constitution it falls under the penumbra of implied rights in the Bill of Rights due to its importance. The Catholic tradition teaches that human rights and responsibilities are at the heart of a healthy community. Within the workplace there is a basic right of workers to be respected by their employers. That is in decent wages, the right to unionize, and a productive work environment. The USCCB notes that work is more than just providing for yourself and your family because it is a way to participate in God’s work. They also suggest that a worthy measure of an institution is its ability to enhance the life of the human person. In the case of lifestyle control, Catholic Social Teaching aligns with provisions to protect the health of employees. This would support a ban on smoking and other such vices that are known to be detrimental to one’s health. If the motives behind the employer’s lifestyle controls align with what is good for society then they should be permissible under the Catholic Social Teaching.

[1] Halbert, Terry, and Elaine Ingulli. Law & Ethics In The Business Environment. 7th ed. Mason, OH: Thomson/South-Western West, 2003. Print.

[2] “Seven Themes of Catholic Social Teaching.” Seven Themes of Catholic Social Teaching. Web. 09 Mar. 2016. .

Los Angeles will pay 24 million dollars to two men who spent decades in prison for crimes they did not commit. In one case, lawyers and a team of students from Loyola Law School challenged a key witness’s testimony. In 1979, Kash Delano Register was charged with the armed robbery and murder of Jack Sasson, 78, after eyewitness testimony placed him at the scene at the time of the shooting. The witness told police she heard gunshots and she saw Register fleeing the scene. The witness selected Register out of a photo lineup, but her sisters told police that her story was untrue. No murder weapon was recovered and no fingerprints were found. Based solely on this witness’s testimony, a jury found Register guilty and he spent 34 years in prison.

The witness’s sister testified she tried to tell a detective that her sister had lied, but in response, the investigator allegedly put a finger to his lips indicating she should keep quiet about it. Her other sister told the police that she was lying, but even her pleas were ignored. Register’s attorneys claimed that the witness selected him under the threat of being prosecuted for credit card forgery and a recent theft if she failed to choose someone out of the lineup.

In the other case, Bruce Lisker was accused of murdering his mother. “At the time of the murder, Lisker, who had a reputation for fighting with his mother and a history of drug abuse, told police he saw her lying in the foyer and broke into the home to help her. They did not believe him.” During a hearing challenging the conviction, lawyers undermined or disproved key elements of the prosecution’s case, including that a bloody shoe print that could not have been made by Lisker’s shoes. His attorneys claimed “that the lead detective ignored evidence that Lisker’s friend may have been a possible suspect.”

In every arrest and criminal prosecution, someone’s liberty is at stake, and these cases illustrate the importance that prosecutors and police get it right. Money can always be replaced. But no one can ever get back all those years lost in prison, as a result of being falsely accused.

Posted by Abier Mustafa.

Stryker Corp., a device maker company, recalled its Rejuvenate and ABG II hip implant devices in July 2012 after warning surgeons they could harm tissue around the hip and cause other health problems to its patients. Patients have complained of severe pain, unusual swelling and excessive metal debris in their blood, blaming all these symptoms on the Stryker devices. There are at least 1,800 cases Stryker consolidated before U.S. District Judge Donovan Frank in St. Paul, Minnesota. After facing more than 4,000 suits consolidated in the New Jersey state court and federal court in Minnesota alone, Stryker will pay a base amount of $300,000 per patient’s case. This settlement to patients who had the devices surgically removed prior to November 3^rd.

Stryker Corp. has reported more than $9 billion in revenue in 2013 on the advertisement of their hip implants lasting for years. After the devices failed patients within a short amount of time, the company has now agreed to pay more than $1 billion to resolve these lawsuits. However, “the company said that it set aside more than $1.4 billion to cover costs of handling cases over the recalled hips so the settlement fell into the “‘low end of the range of probable loss.’” “This settlement program provides patients compensation in a fair, timely and efficient manner,” Bill Huffnagle, a spokesman for Kalamazoo, Michigan-based Stryker, said in an e-mailed statement. A source also reveals that a majority of the payments will be made by the end of 2015.

Abier is a finance major at Montclair State University, Class of 2016.

Posted by Patrick Cleaver.

Every law is made to help the public, to protect the safety of the driver, and deliver a reliable car. The car industry knows they make mistakes and are responsible for fixing the damages for free when such mistakes occur and cars get recalled. However, does a used owner know that he/she is able to get his/her car fixed for free once it had been recalled? Most people do not know that a dealer will fix the car for free after it has been recalled, so the damages are never fixed. The car, marked as dangerous, is instead sold at auctions and then sold again without ever being properly taken care off. While this may end up with nobody getting hurt, doing leaves a huge risk at the buyer’s expense.

Delia Robles was one of the unfortunate people who had been taken advantage of by this system and it ended up costing her much more than she bargained for, getting killed by a defective airbag. Ms. Robles was driving a 2001 Honda Civic on her day off from work when she hit a pickup truck. An accident that would normally end with her walking away unscathed turned into her death bed. The car she was driving has been sold five times over a fourteen-year span and was most recently bought by her son who had no idea that the car was not safe. The information which had not been released to him is that the car was never fixed after it had been recalled for problems with its airbags.

The car was equipped with Takata airbags which “have been linked to 15 deaths.” The airbags were not safe due to being made out of product that wore out over time. That meant that the airbag was a time bomb waiting to explode and Ms. Robles is the one who triggered it. When hitting the truck the Honda had released its airbags which burst and sent metal pieces flying at and killing Ms. Robles.

The issue at hand is that there are no safeguards which prevent deaths like these from occurring. The previous owner is not reliable for not fixing the car like a dealership would be had this happened to a new car. That owner is also not responsible for informing the new owner of the risks they are taking by buying the car. The auction simply sells the car “as is” and does not say whether or not the car is safe to buy.

While there are no federal laws protecting the consumer of accidents in used cars, there are state laws which are implemented in order to keep people safe. According to the New York State law, a seller is not allowed to conceal a material defect because that is a fraudulent action. Also, the New York State auctions are not allowed to sell vehicles “as is” unless they are government agencies. This is a step forward towards the right (safe) way, but does not fix the problem because the Department of Finance takes advantage of it. This department still allows clear negligence by huge companies which can lead to more incidents like the one Ms. Robles experienced. CarMax is a great example of this problem. “CarMax, one of the country’s largest used-car dealers, advertise that their vehicles pass rigorous safety tests – even if the cars have unrepaired problems for which recalls have been issued.” These companies are basically misleading the customers, making people believe that their cars are safe when in reality they could be death traps.

No malice can be proven in the case of Ms. Robles since it has had so many past owners and neither her son, nor the owner before him were aware of the recall on the Honda. Unfortunately, Ms. Robles was a victim of a broken system and now the 50 year old will never get to see her three grandchildren grow up.

Patrick is an accounting major at the Stillman School of Business, Seton Hall University, Class of 2018.

Posted by Steven Doolittle.

Daily fantasy sports are a huge part of the culture in the United States. DraftKings and FanDuel are two of the largest providers of daily fantasy sports and the New York State attorney general on Tuesday ordered those two fantasy sports companies to stop accepting bets from New York residents, due to their games constituting illegal gambling under the current state law. This decision has caused a major problem for the multibillion dollar industry, which has created a demographic of young people and partnerships with professional sports teams. Belief that this decision will continue into other states, a downward spiral for this industry is possible.

In 2006, fantasy sports that involved gambling were exempted from a prohibition against processing online financial wagering, because it was decided the games took more skill than luck. However, now with the offering of huge prizes on more individual sports leads to it being more luck- based, and therrfore, the decision is being questioned. As stated in the article, “The two companies can challenge the attorney general’s order in court. According to Joseph M. Kelly, a professor of business law at the State University College at Buffalo, the state would have to prove that chance is a material factor in fantasy sports, which would make it gambling.” There is a lot the needs to happen to finalize whether it can be classified as illegal.

“The attorney general’s office said daily fantasy sports ‘appears to be creating the same public health and economic problems associated with gambling.’” FanDuel and DraftKings argue that fantasy sports is a game of skill and legal under New York state law. Politicians are saying people are not allowed to play a game they love. It is a debate that will change the world of fantasy sports.

Steven is a student at the Stillman School of Business, Seton Hall University, Class of 2018.

Posted by Arleen Frias-Arias.

According to NPR News.com, Ocwen Mortgage, who has been tasked by FDIC (Federal Depose Insurance Corporation) and US Department of Treasury to assist consumers that are delinquent in their mortgages, is being sued. New York State’s top financial regulator has launched an investigation into Ocwen’s practices as it turns out they are finically hurting home-owners, not helping them get out of foreclosure.

The gist of the article is that Ocwen committed fraud by preparing mortgage documents particularly on what is called a loan modification, which is a legal contract prepared to adjust the payments of loan borrowers who could not make their payments due to hardship. They are also accused of not posting payments already in their possession from borrowers until past the payment due date, deliberately causing homeowners to become late and incur fees.

In my opinion, more needs to be substantiated by regulators to determine if this was widespread, because Ocwen seems to have a reputation of consistently not adhering to the law.

Arleen is a marketing and communication/TV production major at Montclair State University, Class of 2018.

Posted by Abigail Hofmann.

Francisco Garcia of the Sacramento Kings was lifting weights on a Ledraplastic exercise ball on October 9^th, 2009. The 195 pound player was lifting two 80 pound weights while on the ball when it suddenly burst beneath him. This supposed “burst resistant” ball advertised its ability to withstand weight up to 600 pounds. In the fall, Garcia suffered a fracture to his forearm, causing ineligibility for upcoming games. This injury came shortly after signing a five year, $30 million contract. Because of this, the Sacramento Kings wanted “to recoup the more than $4 million in salary, medical expenses and other costs it incurred after Garcia’s injury, as well as prejudgment interest.” (Bricketto)

Ledraplastic initially refused to reimburse the Kings or Garcia for the financial loss or issue a statement recalling the products or forewarning about potential dangers. In the Kings’ product liability case, they were able to prove that the ball burst at weights of mere 400 pounds, rather than the advertised 600 pounds, and that “for a very small expense, the ball could have been made thicker and would have provided the burst resistant capacity as represented.” (Bricketto) Eventually, a settlement was done in private, but the Kings “sought reimbursement for the salary they paid Garcia,” and “Garcia had also sought damages for pain and suffering as well as loss in future earning capacity.” (Lu)

Ultimately, this product liability case was pretty clear on who was at fault: Ledraplastic claimed to have a ball that withstood weights up to 600 pounds, yet failed to hold even 400 pounds. This caused an injury resulting in millions of dollars of damages, and up until the settlement, Ledraplastic refused to forewarn others about this potential danger. Although the settlement was private, we do know that Ledraplastic is now required to warn users of the dangers of using the ball while lifting free weights, hopefully preventing many similar injuries.

Abigail is a management, marketing, and finance major at the Stillman School of Business, Seton Hall University, Class of 2019.

Works Cited:

Bricketto, Martin. “NBA Team Sues Exercise Ball Cos. Over $4M Injury – Law360.” NBA Team Sues Exercise Ball Cos. Over $4M Injury – Law360. N.p., n.d. Web. 08 Sept. 2016.

Lu, Andrew November 1, 2012 5:54 AM. “NBA Star Francisco Garcia Settles Exercise Ball Lawsuit.” Injured. N.p., n.d. Web. 07 Sept. 2016.

Posted by Alhanouf Almubarak.

This case discusses Tesco the Britain’s biggest retailer accounting scandal. In October 2014, the Serious Fraud Office (SFO) began a criminal investigation into accounting practices at Tesco. Chris Bush, (Tesco’s former managing director), Carl Rogberg (former finance chief), and John Scouler (former food commercial head) were charged with fraud over an accounting scandal after the company announced that it had overstated its first-half profit by approximately $420 million. At that time the company suspended many executives for accounting irregularities.

Some of the reasons why Tesco overstated the expected profits of the group at that time was mainly because it agreed on commercial deals with suppliers too early. The investigations against Rogberg, Scouler and Bush revealed that they purposely falsified Tesco’s digital accounting records and its draft interim accounts by the “inputting of and/or reliance upon commercial income figures which gave a false account of the financial position of Tesco.” (Butler,2017). The offenders’ crime by abuse their position and fraud accounting can lead to prison sentences of up to 10 and seven years respectively.