Accounting fraud is a white-collar crime. This type of business fraud occurs when a company manipulates its accounting information and financial statements. The business committing the fraudulent acts wants to coerce an unwitting person.
Accounting fraud could be in the form of a company falsifying documents to give the appearance that the company is worth more than it is. The goal is to get potential investors to purchase the company’s stock using that false information.
Once the accurate value of the company is revealed, the investor gets defrauded. To be defrauded means losing money based on business decisions derived from fraudulent representation. Accounting fraud is punishable by prison, fines, or a combination of both.
If you feel you have been falsely accused, speak with an accounting fraud attorney in Florida right away. Our attorney Rahul Parikh is a battle-tested trial lawyer, who is dedicated to protecting your freedoms and reputation, so speak with Parikh Law right away for a free consultation.
Common Types of Accounting Fraud in Florida
Accounting fraud is committed in a variety of ways including:
- Deliberately not recording expenses such as payments of rent, salaries, or taxes.
- Intentionally overstating company profits.
- Employee fraud occurs when an employee steals a company’s assets like cash, or cash equivalents, and company data or intellectual property. This is known as embezzlement.
- Taking inventory out of a facility or using company assets for personal purposes without authorization.
- Misstating company assets, including equipment, inventory, business supplies, and investments and giving the impression that the company is making more profit than it is.
- Misstating the company’s liabilities, financial debts, or obligations. If the amount of company debt exceeds the number of company assets, the company is referred to as asset-deficient.
- Misrepresenting debts as smaller to make it seem like a company is profitable when it’s not.
- Reporting pending transactions as completed to misrepresent a business’ profits.
Accounting Fraud Proof
Investors who believe they’re victims of fraud may file a complaint with the federal Securities and Exchange Commission (SEC). The SEC will investigate if the complaint is valid, then they may file a civil or administrative proceeding against the potentially fraudulent company.
If you’re looking to prove accounting fraud, the victim needs to provide evidence that the company deliberately falsified financial records. It is the burden of the victim to demonstrate that they were misled and lost money because of this misrepresentation.
It is not easy to prove a company’s intent. To demonstrate intent, the victim will need to prove that an employee or accountant knew the correct facts and chose to misrepresent those facts. Speaking with an attorney who has dealt with fraudulent cases before can help you get the defense you need.
In 2002, a federal law known as the Sarbanes-Oxley Act was passed to prevent whistleblowers from being retaliated against for reporting accounting fraud. A whistleblower is an individual who informs the government that a company has engaged in fraudulent activity. If you need help with your accounting fraud case, speak with Parikh Law, PA right away.
Accounting Fraud Penalties
Accountants should follow Generally Accepted Accounting Principles (GAAP) when preparing financial statements. The law considers GAAP to be the authoritative and proper way to conduct accounting. The GAAP creates consistent practices that allow investors to evaluate a company’s financial worth properly.
Accounting fraud is a crime under state and federal laws. Anyone found guilty of fraud is subject to prison time or an action brought by the federal Department of Justice. The SEC can sue companies whose accounting fraud violates federal securities laws. If the SEC wins the lawsuit, the SEC can obtain civil money penalties, disgorgement, and monetary fines.
Florida Accounting Fraud Penalties
When accounting fraud violates state law, the victim may report the fraud to that state’s Attorney General. The Attorney General may file a lawsuit against the company on the victim’s behalf.
Accounting fraud falls under Florida’s general prohibition against schemes and ongoing conduct done with the intent to defraud another or otherwise obtain property by false pretenses, representations, or statements.
Florida defendants can be charged with two types of fraud in Florida. Organized fraud is fraud related to a continued scheme, and communications fraud is false statements made through the mail or other forms of communication intended to defraud.
If you feel you’re the victim of accounting fraud or have been falsely accused, speak with a fraud attorney in your Florida community today. Accounting fraud lawyers can help you evaluate your case, investigate the allegations, and use that information to clear your name.
Accounting Fraud Attorneys
If you believe you have been a victim of accounting fraud, or you work for a fraudulent company, then then you will want to contact a federal criminal defense lawyer. Accounting fraud is a serious accusation, and the strategies you employ will determine the outcome of your case and the life of the business.
If you or a loved one needs an accounting fraud attorney or criminal law firm that will protect your interests, be honest and upfront with you about your activities to keep you out of trouble, and go to bat for you when things get tough, call Parikh Law, P.A. at 321-558-2704 to speak to a qualified criminal law attorney.