The First Forensic Accountant

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----------------------------------------------------------------------------------rst and most fearless High-Profile Forensic Accountant and how we used the same techniques today to bring down Enron

Tandy Shackelford-Pigott

CM107-11

The "Enron scandal" and the fall of Al Capone had similar characteristics The "Enron Scandal means more than just a tale of accounting manipulation. It surpassed all other accounting frauds, because it was not just a matter of hiding losses, Enron led the pack of white collar crimes committed out of pure greed. The same could be said for Al Capone.

In the 1930,s Frank J Wilson was the man who spearheaded the campaign to convict Al Capon of tax evasion. During prohibition Capone dominated the city of Chicago. He owned or controlled speakeasies, distilleries, brothels, gambling houses, nightclubs and horse and dog tracks. He eventually controlled politics throughout most of Illinois. It was Capon's greed for money and power that eventually brought him down just as it did Enron. A lot of the same techniques were used to achieve this. Attempts by local and federal law enforcement agencies to build a racketeering case against him went nowhere, mainly because he bribed investigators, fixed judges and juries and intimidated(or eliminated) witnesses. He was very clever at covering his tracks. Elliot Ness and his squad of “Untouchables” tried to destroy the Capone Crime Syndicate with brute force which did not work. J Edgar Hoover refused to participate in the investigation. Al Capon paid no income tax on his illegal income. Although Capone lived opulently and spent money lavishly, he never filed a tax return. To get Capone on income tax evasion, the government had to prove he had income in excess of 5,000 dollars,(the standard deduction at the time) federal tax agents estimated his annual income to be about 50 million.( Expert Witnessing In Forensic Accounting, CRC Press 2003) With Enron the flood of allegations of fraud,...
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