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WikiLeaks, Censorship and the Right to Publish

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Readers to this blog know that back in October 2009 I wrote two articles commenting on the WikiLeaks organization.   As an auditor having been exposed to ethical issues in corporate America, and having seen cases where transparency in practice does not always follow documented policies, I felt that WikiLeaks could serve a valuable role in the corporate world, simply by being the place where whistleblowers could expose their concerns without fear of reprisals, especially when they exhaust normal channels.  Today, a year after having written those articles, I feel the same as I did then.  But, in this article I will venture to share some political  observations about the context  in which the planned release of over 350,000 reports, dubbed ‘The Iraq War Logs’, documenting the war and occupation of Iraq from 1 January 2004 to 31 December 2009 is  taking place.   It is up to the reader to determine if any of my observations have future implications for their work in the corporate world.

Thinking about the WikiLeaks media extravaganza brought back memories of my childhood in Cuba, where there is no Freedom of the Press or Freedom of Speech and journalists are regularly jailed for criticizing the government or expressing dissent from the accepted socialist dogma.  In places like Cuba, controlled by dictators or one party systems, the pursuit of the truth, the right to protect the identity of sources, the right to publish free of censorship and the ideals of transparency are often thought of as unachievable dreams.   Because of my personal experiences regarding the value of speaking freely, and memories of the killing, jailing, intimidation, beatings and exile of relatives for the simple reason of “political disagreement,” my support for publishing the leaked Afghan war documents and now the Iraq War Logs may be a bit more complex than that held by the average person.

As an American citizen, with various family members currently and previously in the US military, I support 150% the sacrifices that our service members make on a daily basis.  However, I do not hold similar admiration and trust for our political leaders and the political elites that (unfortunately) send our military men and women to war.  The lies, cover-ups, corruption, greed and incompetence that have occurred during the last fifty years, from the Bay of Pigs, Vietnam, the Middle East, Latin America, and within our own borders in our inner cities, does not lead me to believe that this political culture (of the right or the left) can be trusted, especially when dealing with matters of life or death.   It has become clear that there is a huge and growing socio/economic chasm in America, with those at the top of the pyramid no longer acting for the benefit of the society, but for their narrow selfish interests. Whether this happens by accident or as part of a conspiracy, does not matter.  We have a political elite where its members spend their entire lives in “public office” with many of their children and grandchildren succeeding them to the same or similar offices.  We have billionaires who live in 15 million dollar mansions who spend 35, 50, or 80 million dollars in political campaigns for offices that pay annual salaries of less than $250,000.  And, they tell us they do it for the love of serving the poor and ensuring equality.  We have a two party system monopoly that plays musical chairs getting its members elected by less than 50% of voting adults nationally, and less than 30% of voting adults in local or state elections.   We have a media that repeatedly reports on the same politically correct subjects 24 hours a day, from the same ideological perspective and the same prejudices, by reporters that previously worked for or will work for, the very political or financial elites they are supposedly providing unbiased reporting and coverage on.  Our multinationals  conduct business all over the world  and when cases of corruption surface, our guys are always found to be ethical and within the law, while the foreigners are almost always found to be guilty of all sorts of unethical, criminal and fraudulent acts.  In the name of Globalization our companies ship millions of jobs and capital overseas, but do little to re-invest and create jobs at home, feeding a vicious circle of unemployment, poverty and social unrest.  As the world’s leading superpower, we have no qualms in militarily intervening, threatening and destabilizing other countries when our political and financial elites decide that their arbitrary interests are threatened.  So let there be no doubt, I love America, but I also see its wrinkles and warts.  The America I see today, is not the America I believe our Founding Fathers conceived and wanted.

In this environment and in this day and age, our political elites tell us that it is dangerous to have WikiLeaks publish the leaked Iraq war documents, because it will disclose important secrets that may put the lives of our troops in danger.   It is hard to believe this claim, since it has been used so many times before by the same political culture every time someone published or threatened to publish government wrongdoing.  It was used with the Pentagon Papers and the Watergate leaks.   What seems to be more credible is that the danger is to the political elites and not so much to our troops. The fear of showing the world and the American people the mistakes, incompetence, injustices, arrogance, bullying and waste perpetrated by our top level leaders and institutions is what is at the heart of this call to stop Wikileaks.  If we were living in a totalitarian regime like Cuba or North Korea, this sort of reaction would be expected, but aren’t we in an open democratic society?  What the political elites are telling us is that we have to accept a conditional version of Freedom of Speech, Freedom of the Press and Transparency in government.  They are saying that we have Freedom of Speech only when it does not offend them, that we have Freedom of the Press only when it does not challenge mass media and commercial interests and we have Transparency in government only when the government tells us it’s OK, for our own good!

We hear that Wikileaks should be an exception to the rules used with other media outlets.   That Freedom of the Press protections allotted to other publishers and information distributors should not be extended to it because it is an open forum of information provided by unanimous “uncontrolled” and “un-vetted” individuals from around the world who may harbor anti-American sentiments and that the organization may be influenced by our enemies.   Doesn’t this claim then support the notion that the American mainstream media has legal protections because it subjects itself to a sophisticated form of  censorship, indirectly in the hands of the political and financial elites who determine the financial viability and licensing of these media conglomerates?  Doesn’t this in turn put into question the integrity and reliability of the information analyzed and distributed by the mainstream media?  What does this do to the claim that there is no censorship in America?

In an unprecedented manner, the left and the right, Democrats and Republicans want to crush Wikileaks and its founder.  No one is talking about the original reasons why Wikileaks was founded and what it set out to do.  It was a simple attempt to provide an alternative vehicle to corporate level “Whistleblower” programs, that were seen by many as ineffective and flawed.  The fact that people of all persuasions, from all over the world, jumped on the opportunity to share uncensored information via the platform is evidence of the pent-up hunger there was and there is for such a tool.   The majority of early Wikileak releases were not from disgruntled ex intelligence agents or unhappy consultants informing on government covert operations.  They were articles and confidential papers on corporate fraud, unethical business practices, exposes on dangerous products, corporate bribery, insider trading, multinational tax evasion, unfair labor practices, consumer safety  and so forth.  As a corporate whistleblowing tool, it took a while to take off, but when it did, it quickly became an irritant to many large global organizations.  Wikileaks did not choose or tell a global audience what they should submit for distribution in its platform.  The material was and is submitted at the will and following the motivation of whomever has something they want to submit.  And, this is how politically charged information has made its way to Wikileaks, and how ‘The Iraq War Logs’ found their way to the platform.  These politically charged releases have also created a perfect distraction away from the original goals and objectives of Wikileaks. That of becoming a global corporate whistleblowing vehicle.  Now, these things are forgotten and when Wikileaks is brought up in conversation, we hear instead about spies, the Russians, the Chinese, the North Koreans, traitors and hacking.  It is truly an interesting turn.  The complexity and legitimacy of Wikileaks as a whistleblowing service has been transformed, by very smart and sophisticated media and political experts, into a very simple and primal concept.  Wikileaks equals treason!

By diverting public opinion away from the original subject, the legitimate need for some form of global corporate whistleblower is postponed.  The global tax dodgers are safe, details on dangerous environmental risks in parts of the world will remain unknown and those who fund the arms trade will continue to be nominated for Nobel Peace Prizes.  However, the genie is out of the bottle.  Even if the current Wikileaks is shut down and its founder jailed, what we are experiencing is a high profile confirmation that such a public service is needed.   Future incarnations will be more sophisticated and will likely be designed to withstand the types of technical and legal attacks we have recently seen.  The days of secrecy as we used to know it are over.  In this age of Social Media, cameras in every Smart-phone, instant messaging and millions of blogs, the existence of a Wikileaks type of service is likely to have a deterring impact on the way irresponsible and/or corrupt politicians and corporate executives do business.  And, that’s not a bad thing.

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Nigeria: Corrupt Auditors and Auditing Practices

* (en) Nigeria Location * (he) מיקום ניגריה
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Sometimes its good to read about the auditing profession in other countries to get a sense of perspective about auditing in the USA.

This story published in the allAfrica.com News Service provides a good sense of the lack of ethics, oversight and reliability of auditors in Nigeria. I’ve always wondered (and sometimes admired) how some companies do business in places like these and consistently stay in compliance with the FCPA.  At other times I just wonder how it is that half of the officials in these places are corrupt, but the foreigners who do business with them are always ethical and lawful.   After you read the excerpt below, you can read the complete article by clicking on the link at the bottom of the post:

“Abuja – When the EFCC carried the anti-corruption war to the Federal Ministry of Agriculture and Water Resources recently, it yielded good results. The head of internal audit received marked bills totalling N2 million as a bribe from some contractors. He was caught in the act!

The story has not attracted undue attention, partly because it is common and “normal” in government ministries, departments and agencies. Auditors are envied even by other corrupt colleagues. They obstruct free flow of files so that contractors, suppliers and even workmates are forced to offer bribes to them. Often, they do not act alone: they have the backing of their bosses who also have itchy fingers. In the private sector, internal and external auditors collaborate to doctor the books of quoted and unquoted companies.”

To finish reading the story from the allAfrica.com News Service, click the link below:

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*** Important Update ***

Soon after I posted the article above, I was contacted by a Nigerian person who directed me to a Nigerian Blog that carried a story on the subject of fraud, auditors and the Nigerian Oil and Gas Industry.   Although, I am not a follower of business, political or social events in Nigeria, I found it appropriate to add information about this story, and link it for the benefit of those interested.    The story shows how real efforts are being made in Nigeria to combat corruption and how local auditors are not all corrupt.  Below is an excerpt of the story, posted in the Nigeria General Discussion Blog Website which you can read in its entirety by following the link on the bottom of this update:

“How Corruption, Theft Ruin Nigerian Oil and Gas Industry.  Is PIB the Way Out? – From DENNIS MERNYI, Abuja.

The high level corruption and theft in the extractive industry particularly the oil and gas industry has been exposed for the second time by the Hart Group and Sam Afemikhe group of auditors that carried out the audit report on the activities of the multinational firms in the oil and gas sector, the Nigerian government institutions responsible for both revenue, tax collections and regulations of all financial transactions in sector.

The auditors were commissioned by the National Stakeholders Working Group of NEITI under the chairmanship of Professor Assisi Asobie and their report was unprecedented for their independence and comprehensiveness. In that report, both financial and physical audits were carried out. Nigerian National Petroleum Corporation, NNPC, Central Bank of Nigeria, CBN, several government institutions as well as oil companies were indicted for stealing chunk of moneys either during crude production or refined oil product export or supply.

In the report also, the auditors found some discrepancies among the Petroleum Profit Tax (PPT), royalties and gas flaring penalties the companies declared they have paid and what the CBN said it had received.

NNPC’s reported cash calls were reconciled with receipts by the joint venture operators, but when the audit moved away from the CBN to focus on PPT and royalties in more detail, it ran into several problems because the companies’ assessments of production differed from the Federal Inland Revenue Service others’ records.

NEITI was created in 2004 essentially to develop a framework for and ensure transparency and accountability in the reporting and disclosure by the extractive industry companies, of revenue, owing to or paid to the government. As a subset of the global Extractive Industries Transparency Initiative, EITI, the main task of NEITI is the reconciliation of payment s made by the extractive industry companies with receipts recorded by public agencies.”

The article goes on to mention the challenges faced by the auditors who undertook the investigation, attempts to influence or derail their report by political forces, the large amounts of moneys involved and identifies some of the the foreign companies investigated.

To read entire article, please follow this link:

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Does Wikileaks Support Corporate Whistleblowers?

whistleblower-back-stabbing

Is this the norm for Whistleblowers?

For those who did not read my previous post about Wikileaks.org, here is an explanation of what Wikileaks does, copied from their website:

“Wikileaks is an uncensorable version of Wikipedia for untraceable mass document leaking and analysis. It combines the protection and anonymity of cutting-edge cryptographic technologies with the transparency and simplicity of a wiki interface.

Wikileaks looks like Wikipedia. Anybody can post comments to it. No technical knowledge is required. Whistleblowers can submit documents anonymously and untraceably. Users can publicly discuss documents and analyze their credibility and veracity. Users can discuss the latest material, read and write explanatory articles on leaks along with background material and context. The political relevance of documents and their veracity can be revealed by a cast of thousands.

Wikileaks incorporates advanced cryptographic technologies to ensure anonymity and untraceability. Those who provide leaked information may face severe risks, whether of political repercussions, legal sanctions or physical violence. Accordingly, sophisticated cryptographic and postal techniques are used to minimize the risks that anonymous sources face.”

Now that you know what they do, the excerpt below copied from the Wikileaks  “About” page at http://www.wikileaks.org provides information on Wikileaks views regarding Corporate Whistle blowers.    I believe that the work these folks are doing will likely have a far reaching impact on our professions, corporate ethics, fraud investigations and governance in general.   Read and reach your own conclusions:

“Does Wikileaks support corporate whistleblowers?

It is increasingly obvious that corporate fraud must be effectively addressed. In the US, employees account for most revelations of fraud, followed by industry regulators, media, auditors and, finally, the SEC. Whistleblowers account for around half of all exposures of fraud.

Corporate corruption comes in many forms. The number of employees and turnover of some corporations exceeds the population and GDP of some nation states. When comparing countries, after observations of population size and GDP, it is usual to compare the system of government, the major power groupings and the civic freedoms available to their populations. Such comparisons can also be illuminating in the case of corporations.

Considering the largest corporations as analogous to a nation state reveals the following properties:

1. The right to vote does not exist except for share holders (analogous to land owners) and even there voting power is in proportion to ownership.
2. All power issues from a central committee.
3. There is no balancing division of power. There is no fourth estate. There are no juries and innocence is not presumed.
4. Failure to submit to any order may result in instant exile.
5. There is no freedom of speech.
6. There is no right of association. Even romance between men and women is often forbidden without approval.
7. The economy is centrally planned.
8. There is pervasive surveillance of movement and electronic communication.
9. The society is heavily regulated, to the degree many employees are told when, where and how many times a day they can go to the toilet.
10. There is little transparency and something like the Freedom of Information Act is unimaginable.
11. Internal opposition groups, such as unions, are blackbanned, surveilled and/or marginalized whenever and wherever possible.

While having a GDP and population comparable to Belgium, Denmark or New Zealand, many of these multi-national corporations have nothing like their quality of civic freedoms and protections. This is even more striking when the regional civic laws the company operates under are weak (such as in West Papua, many African states or even South Korea); there, the character of these corporate tyrannies is unobscured by their civilizing surroundings.

Through governmental corruption, political influence, or manipulation of the judicial system, abusive corporations are able to gain control over the defining element of government — the sole right to deploy coersive force.

Wikileaks endeavors to civilize corporations by exposing uncivil plans and behavior. Just like a country, a corrupt or unethical corporation is a menace to all inside and outside it.”

I’ve heard calls for reforms in the board room, but what these folks are talking about goes a little beyond that!

Wikileaks Plans to Make the Web a Leakier Place

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This may be one of the most revolutionary events in the history of Corporate Governance, since the SEC was established.    It will be interesting to follow how this service unfolds around the world and here at home.

Here is an excerpt of the article:

“IDG News Service – Wikileaks.org, the online clearinghouse for leaked documents, is working on a plan to make the Web leakier by enabling newspapers, human rights organizations, criminal investigators and others to embed an “upload a disclosure to me via Wikileaks” form onto their Web sites.

The upload system will give potential whistleblowers around the world the ability to leak sensitive documents to an organization or journalist they trust over a secure connection, while giving the receiver legal protection they might not otherwise enjoy.

“We will take the burden of protecting the source and the legal risks associated with publishing the document,” said Julien Assange, an advisory board member at Wikileaks, in an interview at the Hack In The Box security conference in Kuala Lumpur, Malaysia.”

To read the complete article, from CIO.com, please click the link below:

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GovTrack: H.R. 2152: Text of Legislation, Introduced in House

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From time to time Today’s Audit Journal will post information on legislation passed or under consideration, of relevance to our professions.   This post provides information on a bill that may change the FCPA into a more aggressive and enforceable law.

Foreign Business Bribery Prohibition Act of 2009.

This bill under consideration in Congress can change the way the FCPA is enforced.  If your work includes reviews / investigations relating to the FCPA, read the full text of the bill by following the link from GovTrack.us below:

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Closing The Loop – Fraud Investigations

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Here is an excellent article from Bank Fraud Forum on Fraud Investigations.   It provides a good picture of the challenges that take place in most internal audit departments and corporate investigative groups.   After you read the excerpt below, you can click the link at the bottom of the post for the full article:

“Oh what a tangled web we weave, When first we practice to deceive – Sir Walter Scott

Unraveling complex internal fraud schemes can be exceptionally challenging. As my fellow countryman puts it, the web that fraudsters weave can be relatively logical or completely unstructured and seemingly random.

Most internal fraud investigations involve an interrogation of the suspect(s) to determine guilt or innocence. During my career, I have been lucky enough to conduct hundreds of interrogations (or as HR likes to call them interviews). I have had the privilege of learning from many highly trained interrogators from local, state and federal law enforcement. Very early on in my fraud career, they taught me a very valuable interview approach that I believe many interrogators neglect to utilize. The approach, if used appropriately, can close the loop and dramatically improve a banks ability to prevent internal fraud.

An interrogation with a fraud suspect involves many phases including establishing a baseline, information gathering, the confrontation, the confession etc. However, once a confession is provided by the employee many investigators stop the interview, suspend the employee and return to the office. That is a mistake.

The employee has just admitted their role in the scheme. Often, employees appear almost relieved. Certainly, some are distraught, others may be aggressive, but for those that express a sense of relief, now is the time to truly help the bank stop more fraud.
Consider asking the relieved employee the following types of questions….”

To read the rest of the story from Bank Fraud Forum, click the link below:

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