Los Angeles Accounting Fraud Defense Lawyer
Accounting fraud is very closely linked to securities fraud. In fact, most accounting fraud is committed in an effort to affect the performance of publicly traded corporations. The distinguishing characteristic that places a crime within the scope of accounting fraud is that the individual being charged with the crime is an accountant or agent for an accounting firm and acting within the scope of his or her employment. Most charges of accounting fraud involve complex methods for misusing or misdirecting funds, overstating revenues, understating expenses, overstating the value of corporate assets or under-reporting the existence of liabilities, sometimes with the cooperation of officials in other corporations or affiliates. The investigation into such fraud charges is led by the federal Securities and Exchange Commission which requires yearly financial reports from all public companies.
United States Code Section 1520 states that any accountant who conducts an audit of an issuer of securities, “must maintain all audit or review work papers for a period of 5 years from the end of the fiscal period in which the audit or review was concluded.” Furthermore it goes on to state that, “the Securities and Exchange Commission shall promulgate, such rules and regulations, as are reasonably necessary, relating to the retention of relevant records such as work papers, documents that form the basis of an audit or review, memorandum, correspondence, communications, other documents, and records (including electronic records) which are created, sent, or received in connection with an audit or review and contain conclusions, opinions, analyses, or financial data relating to such an audit or review, which is conducted by any accountant who conducts an audit of an issuer of securities.”
The punishment for a knowing of willful violation of section 1520 is a fine, imprisonment for not more than 10 years, or both. Due to the severe penalties associated with a federal crime conviction, contact a Los Angeles accounting fraud attorney at our firm for a free case evaluation. Call (877) 781-1570 or fill out online contact form.
Related Information: Investment Fraud | Wire Fraud