All posts by Lew

I am a new father. My wife is an ordained minister, who is presently on leave from call. I am a Certified Public Accountant (lic. TN) and a Certified Fraud Examiner. I have been employed by the Office of the Comptroller of the Treasury of the State of Tennessee as an auditor/investigator for over nine years. My wife is now contemplating a return to active ministry. She would like to do that part time at first. Unfortunately, the denomination to which she belongs is small in numbers in the southeastern United States. This means that there is almost certainly a move in our future. In order to survive financially, I will have to accept a position before she can accept a call.
Links

Interesting NPR Story About Fraud

On the drive home from work today, a story caught my attention.

Psychology Of Fraud: Why Good People Do Bad Things

A link to the story on the web is here.

The longer I work as an investigator, the more I think that there must be more to the motivation behind most frauds than what can be explained by the usual interpretation of Donald R. Cressey’s Fraud Triangle. This page from the Journal of Accountancy has a good graphical depiction of the concept.

Usually fraud is depicted as a solitary occupation of one who has an unsharable need. Although Toby Groves’s first fraudulent act (according to the story) was falsifying a loan application on his own property, he soon involved many others in his scheme. His employees had a stake in his schemes succeeding, but many others seemingly participated only because they wanted to be helpful.

I do have some questions about the concept of ethical blind spots. For those who did not personally benefit or only benefitted indirectly, I think this is possible. For Groves himself, I cannot excuse him from intent. The last sentence of Chapter Three, “And if we want to attack fraud, we have to understand that a lot of fraud is unintentional[,]” contradicts the definition of fraud, which involves intent to deceive.

Background

The Search Continues

Today is May 1, which is more than three months after my last entry. I was disappointed that I did not receive a job offer from the interview that I mentioned in my last post. I have had several additional telephone interviews and one more face-to-face.

I am completely ready to complete the move to Texas. Presently, I am returning to Nashville for several weeks at a time to work while I search.

Links

New York Times Opinion Piece on Groups vs. Working Individually

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I have not updated recently. My family is in the process of moving to Texas. My wife has a job and I have an interview!

I found an interesting (to me at least) New York Times opinion piece about different types of work environments and their effect on productivity and creativity. The title is “The Rise of the New Groupthink.” Here is a link.

Case

Lakewood Postscript

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The Nashville City Paper has reported that the City of Lakewood ended its operations with over $450,000 of traffic fines receivable. According to the story, once the city ceased to exist as a political entity, there was nobody to collect the unpaid fines. As a result, many of the drivers may currently be unknowingly driving on suspended licenses. Here is a link to the story. I do not know how long the City Paper keeps its links active.

In 2009, I investigated theft from traffic fines in Lakewood. Here is a link to the first part of the case study that I wrote about it.

Background, Case, Uncategorized

An Incredible Case Study: Memphis Property and Evidence Room

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When one studies accounting and auditing, one learns a lot of theoretical information about counting inventory. Personally, I had already managed a business (a restaurant) for a few years and had also earned extra money moonlighting with an inventory service before I enrolled at the University of Tennessee in the fall of 1998. None of that remotely prepared me for a BIG investigation that my office conducted during the fall of 2003.

The investigative audit report for this audit is available here.

The main legal-issues were well summarized in Director Dennis Dycus’s letter to the then-comptroller, John Morgan, which is an integral part of the report.

Our investigative audit revealed that 116.6 kilograms of cocaine, with a street value estimated at $2,332,408, and 559.8 pounds of marijuana, with a street value estimated at $447,876, could not be accounted for. Auditors were unable to locate or account for certain cash items totaling $147,218.26, and were unable to account for at least 66 firearms.

Yes, this was unlike any inventory assignment I had seen before!

Updates, Website

Resume Surgery

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As the importance of this search has increased, I have taken the time to reexamine the resume that I have been submitting. I realized that the version that I had been using would have been effective if I needed to qualify as an expert witness (which was my starting point), but did not really sell my brand. That is, what I am now trying to do and needing to do.

I reorganized the information, shortened some areas and added others. Here is the latest version.

Background, Case

In Rutherford County the Riverdale Coverage Entered its Second Week

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Last Friday, the Daily News Journal ran its second consecutive front page story about my office’s report on an investigative audit of the Riverdale High School Quarterback Club. The article, titled “Audit: Principal Failed to Monitor Finances,” is here (at least for the moment–the DNJ does not seem to leave its content up for very long).

Last Sunday, this was the DNJ’s editorial: Editorial: “Gill mustn’t fumble in discipline for QB Club.”

Today, the DNJ ran this story: “Audit fallout: Gill eyes policy change for booster clubs” on its front page.

Case

More Media Coverage

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Almost from my first day on the case, I had expected that the Riverdale report would be front page news in Murfreesboro. I was not surprised to see this on my doorstep this morning.

Top of Page 1, Daily News Journal 7/14/2011

Here is a link to the entire article.

I thought that it would probably be covered to some degree in Nashville too. However, I truly did not expect this:

Tennessean 7/14/2011″]Here is a link to the Tennessean article.

Here are two more broadcast stories. As of this writing, both have video available. WSMV’s story is here; WKRN’s is here.

I am hopeful that this will lead to positive changes throughout the state.

If anyone associated with a school support organization in Tennessee happens to find this post, and wants more information about which sources of money are reserved for the schools themselves, I would recommend referring to applicable sections of the Tennessee Code (Title 49, Chapter 2 in particular), to the Model Financial Policy for School Support Organizations (Procedures Manual), and to the Tennessee Internal School Uniform Accounting Policy Manual (effective July 1, 2011).

As always, please be aware that the content presented here does not necessarily represent the views of the Comptroller’s Office.