Unlike auditing which focuses on materiality and whether an organization’s books are records were prepared in accordance with Generally Accepted Accounting Standards, forensic accounting combines technical accounting skills and techniques with investigative processes. Allegations against an organization often include accounting fraud, overstated income, understated expenses, theft of inventory, intellectual property or fixed assets, embezzlement, expense fraud, kickback schemes and undisclosed conflicts of interest. Evidence of these and other types of financial crimes can be found when examining the company’s accounting, business and banking records. Forensic accounting is usually coupled with other investigative activities such as forensic data analysis, investigative due diligence of subjects, witness and admission seeking interviews and the acquisition and analysis of electronic evidence such as the contents of a computer and email systems. Forensic accounting is of particular importance when the allegations, if proven, could require a publicly traded company to restate their earnings.

Increasingly, business, accounting and banking records are maintained in digital format.Likewise, the primary mode of business communications is email but also includes instant messaging, text messages, chat and ephemeral communications. The majority of accounting records are maintained in software programs such SAP or Oracle. Advances in computer processing speed and storage capacity and the growing sophistication of artificial intelligence, machine learning and deep learning now make it possible to ingest and analyze terabytes of data and find patterns and anomalies that a manual review of data is far less likely to yield.

Counter party risk is among the most challenging.  Customers, intermediaries, vendors, acquisition targets and JV partners all have the potential to take actions that give rise to significant liability for the organizations with whom they are interacting.   One proven way to dampen those risks is using risk-appropriate investigative due diligence.  By examining media archives, criminal records, civil dockets, corporate registrations, related parties, bankruptcy proceedings, regulatory filings, professional licensing disciplinary records and other information sources, organizations can make much more informed decisions as to the suitability of potential customers and third-party business partners.  Performing due diligence investigations can unearth important red flags of prior behavior, undisclosed liabilities, criminal associations, or other issues that require close attention.  Armed with this information, clients can have candid and productive dialogues with their customers and business partners to better understand any issues arising from due diligence investigations.  And on occasion, put clients in a position to derisk before their history of problematic behavior becomes your legal liability. 

Investigations, Regulatory Compliance and Cyber Security are all processes that are highly dependent on enabling technologies.  And yet, there are so many providers that make similar claims. WCF stays current on which technologies are widely in use and have credibility with organizations such as the U.S. Department of Justice Fraud Section, the SEC or financial regulators.   Use of artificial intelligence to find hidden connections and anomalies in vast data sets. Robotic process automation to make routine, repetitive and resource intensive decisions such as false positive matching. And machine and deep learning to adjust algorithms based upon findings to make them more accurate and reliable, can all be part of what makes your investigative, compliance, AML and fraud detection and cyber security processes much more effective or not depending upon how rigorous your selection process is.  WCF and its network has a great deal of experience guiding clients on vendor selection and assisting clients to deploy best in class enabling technologies to assist them on their path to becoming resilient.

Failure to consider compliance, corruption, money laundering or fraud risk when performing a SWOT analysis, considering a transaction, customer relationship or strategic partner can lead to costly and time-consuming problems if not legal liability. Understanding counterparties to transactions from a reputational and historical performance perspective will help avoid costly mistakes. Identifying risks as a part of acquisition due diligence before successor liability attaches helps ensure that the goals of your acquisition strategy are met without inheriting pre-existing problems such as ongoing fraud or bribery schemes.  Operating ethically in a corrupt world requires a strategic approach to risk.  WCF provides practical, tangible advice as to the strategy and tactics needed to operate everywhere you need to operate without allowing “local business practices” to undermine your organizational ethos.

The world is fraught with physical dangers. And yet executives in global organizations must travel domestically and internationally in the furtherance of their responsibilities. Each country has its own dangers and business executives are sometimes targeted by criminal organizations.  Western organizations, particularly well-known brands, are sometimes targeted for what they represent, the goods and services they provide or taking a stand that puts them at odds with organizations engaged in violent protests or criminal activity. At home, at the office and traveling for business or vacation each present unique challenges and susceptibility to risk. WCF’s executive protection partners include former Secret Service, FBI, Diplomatic Protection, and military who are experts in assessing potential threats to high profile individuals and tailoring an executive protection approach that will significantly reduce vulnerability.

Most organizations do not have extensive investigative capabilities in-house. WCF advises boards of directors, senior leadership, in-house counsel, chief compliance officers, chief audit executives and outside counsel — from the outset of an investigation to its successful conclusion. Incident response, fact gathering, witness location, admission seeking interviews, liaison with law enforcement, remediation of internal controls, and applying the “lessons learned” to the satisfaction of law enforcement and regulators all combine to bring an investigation to a successful conclusion. WCF’s investigative experience runs the gamut from embezzlement and kickback schemes to accounting frauds leading to securities fraud charges and a restatement of earnings.

Ignoring a hotline allegation is not an option. Public companies have a fiduciary obligation to assess each allegation and determine whether it has merit. WCF recommends a pragmatic, two-step approach to whistleblower allegations. Assess the data and documentation relevant to the allegations and determine whether any of what has been alleged can be independently corroborated. When further investigation is unwarranted, we provide documentation to support that decision. If there is a need for further investigation, WCF provides valuable advice as to what further investigative steps are warranted and assists in their execution.

The ability to image and analyze devices, servers and email accounts is of critical importance to most investigations and many compliance regulatory projects.  Devices and email accounts often contain critically important information that must be examined in the course of the investigation and may need to be exchanged with legal adversaries in any ensuing litigation.  WCF works with a network of independent affiliates with the technical capabilities and professional credentials to properly perform sector-by-sector images of computers, servers, smartphones, tablets and external storage devices in adherence with the rules of evidence, extract evidence and recover deleted files for forensic and legal review.

Surveillance is sometimes the best way to gather evidence of wrongdoing.  Physical theft, proving relationships, establishing someone’s movements, determining the legitimacy and assessing activities and business locations, and locating individuals can at times be of critical importance to an investigation or a dispute.  WCF can deploy fixed and vehicular surveillance when and where it is needed to provide clients and their counsel with surveillance evidence in support of their investigative or litigation objectives.

State-sponsored industrial espionage, theft of intellectual property, interpersonal or legal disputes and stalking often involve the use of illegal listening devices and hidden cameras. Such equipment is widely available in stores and on the internet, is easy to install and difficult to detect. Technical Surveillance Countermeasures (TSCM) entails using specialized equipment designed to detect listening devices and surreptitious video recording equipment.  Listening devices and hidden cameras emit radio frequencies, disrupt the flow of electricity (non-linear junction detection) and give off heat signatures detectable through thermal imaging or other indicators that can be detected. WCF maintains a network of former law enforcement experts who perform painstaking physical inspections of homes, offices and vehicles examining each outlet, electrical appliance, light fixture and other items that draw power and “sweep” each area using highly specialized equipment that detects devices that are both in active mode and those that are powered off. Once detected, our TSCM experts remove all devices and safely restore the electrical connection to its original state.

Compliance and investigations are intertwined. Sometimes, investigations are of breaches of the compliance framework and other times investigations expose shortcomings in the compliance program itself. The DOJ and SEC and other organizations have published authoritative guidance on what an effective compliance program should look like. An effective compliance program is as essential as insurance or a secure network. Whether it is an overall examination of the ethics & compliance program, anti-bribery and corruption program remediation, anti-money laundering or efforts at bringing the company into alignment with the COSO Fraud Risk Management Guide, WCF has extensive experience designing, implementing, evaluating, remediating, and implementing industry-leading compliance programs and the controls underlying them.

Qualified and highly experienced compliance officers are in short supply and organizations frequently struggle to adhere to their own service level agreements for the timely handling of compliance issues such as hotline investigations, risk assessments, compliance audits, instructor-led training, root cause analyses, policy reviews and other day-to-day compliance program related activities. When a crisis emerges, compliance departments sometimes struggle to keep pace with their workstreams or implement and staff special projects related to internal investigations or regulatory actions. WCF maintains a worldwide database of highly qualified and experienced former compliance officers and compliance advisors who are available to work on a project basis to help organizations address their increased workload.

Monitors have been used for many years by law enforcement and regulatory agencies to “monitor” the compliance remediation activities of corporations, labor unions, government agencies and non-profit organizations. They are often an outgrowth of criminal prosecutions, litigation, regulatory actions, suspensions or debarments. The role of the monitor is to provide the overseeing body with an impartial assessment of the monitored organization’s compliance remediation activities and progress.
Sometimes, organizations engage a monitor voluntarily. This can be an effective way for the organization to demonstrate to law enforcement, regulators, boards, investors and other interested parties that the organization is committed to addressing the historical misconduct and elevating the ethics and compliance program, internal controls and ethical culture. WCF personnel are well-qualified to serve as independent monitors following settlements with regulators. We are equally well-qualified to assist organizations and counsel in their interactions with government-appointed compliance monitors; and serve as a forensic and compliance advisors to monitors.

Financial crimes such as embezzlement, kickback schemes or accounting frauds often result in significant financial losses. WCF has extensive government and private sector experience identifying and recovering criminally derived assets through the performance of a combination of intensive public record and human intelligence asset search investigations and financial analyses of banking, brokerage, real estate and business records.  Once identified, WCF works with outside counsel to devise a strategy to recover those assets through a coordinated investigative and litigation process.  In addition to recovering assets directly from responsible parties, insurance claims can be another avenue of financial recovery. Insurance policies such as Fidelity, Crime, Directors & Officers Liability, General Liability or Cyber Insurance can all potentially go a long way toward making victim organizations whole following a major incident.  WCF personnel have extensive experience assisting clients and their counsel in gathering and presenting evidence in support of insurance proofs of loss and successfully making claims against those insurance policies.

WCF personnel have extensive experience testifying in criminal and civil proceedings both as fact witnesses and presenting summary evidence outlining overall investigations, the evidence collected and the chronology of the investigation. In addition, WCF maintains a roster of independent testifying experts who are PhD economists, Certified Public Accountants, anti-money laundering, bribery and corruption, cyber-crime, fraud risk management and other experts who can present evidence on lost profits, technical accounting issues such as the proper accounting rules that should have been followed, quantify damages, explain money laundering, corruption or cyber-crime techniques or provide other types expert testimony in support of legal counsel.