Staffer who stole $250,000 from Bank gripped by ‘chronic gambling’

7 December 2012 By
Forensic Accountants Sydney Bank Fraud

Forensic Accountants commonly investigate frauds such as the one commiitted by an employee of a Sydney Bank.

A former Commonwealth Bank employee who stole almost $250,000 from customers’ accounts has been described by a magistrate as intelligent and resourceful but gripped by “chronic gambling”.

Karen Myhanh Chau, 40, stole almost $250,000 from wealthy clients, including author Thomas Keneally, and transferred the funds into a personal account.

She committed the crimes between October 2010 and January of this year.

Chau pleaded guilty in August to six counts of dishonestly obtaining financial advantage by deception and in October was sentenced to 18 months’ imprisonment with a non-parole period of one year.

In Downing Centre Local court on Wednesday, Deputy Chief Magistrate Jane Mottley ruled that Chau could serve out her sentence in home detention.

“She is clearly a resourceful and intelligent woman,” Ms Mottley told the court.

“She is likely to find it difficult to get employment in the financial industry as a result of this offence.”

Chau took the money from the clients in 72 separate transactions and put some funds back into some of the victim’s accounts to indicate interest was being earned.

The Commonwealth Bank has said it had refunded all the money to the clients.

Ms Mottley said Chau had endured tough personal circumstances in the early 2000s, including a miscarriage, and this had led to depression, contributing to her gambling addiction.

She said Chau was “gripped by a chronic gambling problem” and gambling had become a coping strategy for her.

“This offence is a clear manifestation of an unresolved addiction” she said.

Chau has no prior convictions and was described as a “model citizen” during sentence submissions in October.

The court heard she has been making excellent progress at gambling counselling sessions.

Her minimum home detention period expires in October next year.

(Source: AAP, 28 November 28 2012)

Further Information – Forensic Accountant

If you would like further information about using our forensic accounting services for a financial investigation or other expert witness matter, then please contact us for an obligation free discussion.

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Filed Under: Forensic Acccountant, Uncategorized Tagged With: ,

Alleged fraud involving more than $3m on business credit card

16 October 2012 By
Forensic Accountants commonly investigate expense reimbursement fraud

Forensic Accountants commonly investigate expense reimbursement fraud

A 40-year-old man has been charged with fraud after police allegedly seized $3 million worth of property – including wines, food, office supplies and cleaning products – they say he had stashed in warehouses across Sydney.

In January last year, police allegedly found a large amount of fraudulently obtained goods in a warehouse in Old Guildford in Sydney’s west and set up Strike Force Traver.

During the long investigation, millions of dollars worth of property were allegedly discovered at several warehouses across Sydney.

Police believe the items were bought illegally through a business using a credit card but never paid for between October 2010 and January 2011.

The man was arrested in Silverwater on Friday. He was charged with 27 counts of fraud, refused bail and will appear in Parramatta Local Court today.

Strike Force Traver, involving Fairfield local police, will continue their investigations.

Anyone with information should call Crime Stoppers on 1800 333 000.

(Source: Esther Han, SMH, 13 October 2012)

Filed Under: Forensic Acccountant, Fraud Investigation Tagged With: , ,

Magistrate flabbergasted at Baden-Clay delay

9 July 2012 By

Delay to forensic accounting report by the Queensland Police

It could take another five months for a forensic accountant employed by Queensland Police to analyse financial records belonging to accused murderer Gerard Baden-Clay, prosecutors say.

Mr Baden-Clay is accused of killing his wife and the mother of his three daughters, Allison, in their Brookfield home in April this year.

I can’t believe for any minute that it would take five months for an investigative accountant to look into the affairs of one defendant

Lawyers prosecuting the real estate agent briefly faced Brisbane Magistrates Court today to arrange the handing over of a “voluminous” brief of evidence to Mr Baden-Clay’s defence team.

Mr Baden-Clay was due to face the court via video-link from prison, but was instead represented by his solicitor Darren Mahony.

Prosector Danny Boyle told the court the Office of the Director of Public Prosecutions was ready to hand over 330 witness statements already contained in the brief of evidence, but said it could take up to five months for a forensic accountant with Queensland Police to provide her report on Mr Baden-Clay’s financial affairs.

Mr Bolye said police were also in the process of obtaining a further 50 to 100 witness statements.

Mr Boyle said police were also waiting on computer and phone examinations, as well as results from the post-mortem.

“The post-mortem tests are outstanding … the forensics pathologist was away last week and this week until Wednesday” he said.

Magistrate Chris Callaghan said he was “flabbergasted” to hear of the lengthy delay.

“I can’t believe for any minute that it would take five months for an investigative accountant to look into the affairs of one defendant” he said.

“The defence can’t be asked to make any decisions without the full brief.”

Mr Boyle argued the accountant’s statement was a “discreet matter” compared to other matters in the brief.

However, Mr Mahony also voiced concern at the delay.

“I don’t want there to be any delay in provision of other material, because we’re waiting on the statement of one accountant” he said.

Mr Callaghan ordered that the brief of evidence, excluding the statement from the forensic accountant, be handed to Mr Baden-Clay’s legal team by August 20.

He ordered that Mr Baden-Clay face court again on September 3.

Mrs Baden-Clay’s body was found on a Brisbane creek bank 10 days after her husband reported her missing on April 20.

Earlier this month, Mr Baden-Clay was arrested and charged his 43-year-old wife’s murder and interfering with her body by moving her to the location where she was found.

Court documents have previously revealed that Mr Baden-Clay’s debts totalled about $1 million. It is alleged he stood to gain about $960,000 from his wife’s life insurance and superannuation policies.

He was refused bail and remanded in custody.

(Source: Marissa Calligeros, Brisbane Times, July 9, 2012)

Further Information – Forensic Accountant

If you would like further information about using our forensic accounting services for a financial investigation or other expert witness matter, then please contact us for an obligation free discussion.

We provide services to corporations, law firms and individuals in Sydney, Brisbane, Melbourne, Adelaide, Perth and across Australia.

Filed Under: Forensic Acccountant, Investigation, Litigation Tagged With:

Facebook Flirting Causes One-in-Three Divorces

4 January 2012 By

Facebook flirting and comments contribute to an increasing number of divorces, underscoring how social media is affecting privacy and family interactions.

Facebook flirting and divorce

Facebook flirting and divorce

One-third of 2011 divorce cases in England implicated Facebook as a cause, according to a survey conducted by a U.K.-based divorce website. The 5,000 people polled cited three reasons for listing Facebook in divorce petitions, including sending inappropriate messages to the opposite sex, posting negative comments about exes on the social network, and friends disclosing a spouse’s behaviour.

The survey highlights how burgeoning social media use blurs the line between public and private. The nature of Facebook, Twitter, Google+ and other social media outlets encourages free-spirited commenting, posting and sharing of information.

However, what’s posted on social networking sites may not be as private as users think.

When marital problems or other difficulties arise, social media postings are subject to closer and wider scrutiny and take on a new life, often as evidence in custody battles and divorce cases. For example, a Connecticut judge ruled one couple must share social media passwords as part of their divorce agreement, leading to speculation about how and by whom the photos, comments and personal information people share can be used.

Legal experts assert as social media sites grow in popularity, people must be vigilant about what they post and refrain from making disparaging remarks or gossiping with friends about a spouse, children or other parties in a case.

“People need to be careful what they write on their walls, as the courts are seeing these posts being used in financial disputes and children cases as evidence” said Mark Keenan, a spokesman for Divorce-Online.

Divorce cases aren’t the only personal legal matters involving social media postings. Apple recently fired an employee who ranted about his job on Facebook, and termination procedures were launched against a New Jersey teacher who called her students “future criminals” on the social network.

Incidents like these could lead users to edit what they do and say on sites out of fear of future recrimination, or even pull away from them altogether, an unwelcome trend for companies like Facebook and Google.

In response, both Facebook and Google+ strengthened privacy controls in recent months to help users feel more secure. Facebook’s “smart lists” and Google+’s “circles” features allow users to more tightly control who can see and share their posts and comments.

Site-based privacy controls can help protect users during normal, day-to-day interactions, but during a personal upheaval like a divorce, a list of trusted “friends” may suddenly turn out not to be so trustworthy, highlighting a need for increased user responsibility alongside better privacy protections.

(Source: Forbes.com, 3/01/2012)

About Rushmore Forensic

Andrew Firth is a director of Rushmore Group. He has conducted numerous investigations, business valuations and other forensic accounting engagements in Australia, Singapore, the UK, Thailand, Hong Kong, Vanuatu, and the USA.

He specialises in assisting people going through divorce and provides other forensic accounting services for commercial disputes.  He is a member of the Institute of Chartered Accountants and has appeared as an Expert Witness in numerous jurisdictions. For more information or to arrange an appointment, please contact us or call now on (02) 8019 7262.

Filed Under: Family law, Forensic Acccountant Tagged With: ,

Laws hinder the search for missing millions

21 December 2011 By

HIS grandfather built the Sydney Harbour Bridge, but John Gordon Bradfield will probably be remembered less fondly – at least by about 100 of his former clients who were left out of pocket when the solicitor’s practice folded three years ago.

John Bradfield, former Dural Solicitor

The Dural solicitor is believed to have run a Ponzi-style investment scheme, which collapsed in late 2008 owing investors at least $24 million.

Three years on, his trustee in bankruptcy, Ian Struthers, is still trying to piece together the money trail.

But his attempts to find out where the money went hit a stumbling block after a court found that Jean Sayer, the receiver appointed to Mr Bradfield’s legal practice, was prevented by law from revealing information to the trustee.

Earlier this year the Federal Magistrates court ruled Ms Sayer did not have to hand over documents or give evidence in an examination after she argued she was prohibited by the Legal Profession Act from disclosing more than 13 volumes of information.

Mr Struthers had argued co-operation was in the public interest as it would prevent a waste of creditors’ funds. He also argued she had access to documents which were relevant to his task.

The court registrar ruled in Ms Sayer’s favour, finding that the Legal Profession Act prohibited her from disclosing information she had obtained in her capacity as receiver at the scheduled bankruptcy examination.

The registrar said the basis for the ruling was “a possibly technical” one.

”It is very unfortunate that in the interest of the creditors and investors the trustee could not have access to material about the business of the bankrupt…” the court said

Investors who gave money to Mr Bradfield before October 2005, may also be entitled to payments from the Law Society’s Fidelity Fund.

In October, Mr Struthers asked the head of the Law Society of NSW, Stuart Westgarth, to review the matter, but his letter also went unanswered.

Mr Westgarth yesterday told the Herald the receiver was independent to the society, but said she was under legal obligations not to disclose the material.

He said the Law Society believed the Bradfield case was ”extremely serious”.

Mr Westgarth said 80 per cent of claims on the fidelity fund had been finalised, but the receiver was waiting further documentation about the remaining claims.

The head of the NSW Police fraud squad, Col Dyson, said a police investigation was continuing. He said police had ”no issues with the cooperation received from the Law Society or any person acting on behalf of the Law Society”.

(Sourced from SMH, Geesche Jacobsen, 22/12/11)

Filed Under: Fidelity Fund, Finding Assets, Forensic Acccountant, Investigation, Litigation, NSW Law Society, Ponzi Investment Scheme Tagged With: , , , , ,

Queensland Government’s criminal history checks fail to pick up third public servant

16 December 2011 By

FRESH concerns have emerged over the State Government’s ability to vet staff after revelations that a third public servant with a criminal history has been discovered this year.

Criminal Background Check

Just days after revealing a man who allegedly embezzled $16 million from Queensland Health had a criminal history in New Zealand, The Courier-Mail has learnt that Corrective Services has hired a prison guard convicted of drug and weapon offences.

The guard was handed a job because a person ticked a wrong box during the check process.

Jennifer Dann was employed full-time by Queensland Corrective Services in July and worked at the Brisbane and Woodford correctional centres.

Dann was sacked three months later but only after concerns from an outsider were raised that a woman with her criminal history would be allowed to guard prisoners.

This follows a blunder in March when a Croatian man on Interpol’s most wanted list was discovered working as a state government security guard after 18 months patrolling the executive building and courts.

The Government does not undertake its own criminal checks, rather it sends names of applicants to the Queensland Police Service, which runs them through the national criminal database Crimtrac. The information is returned to the departments for their assessment.

According to court records, Dann has a conviction recorded at Caboolture Magistrates Court in 2000 for possession of a dangerous drug and weapon as well as secure storage of a weapon.

Acting Corrective Services Commissioner Marlene Morrison acknowledged the error and said the check did pick up her history and her job application was rejected. However, an administrative error resulted in Dann’s employment after she sought a review.

Ms Morrison said Dann worked full-time at Brisbane Correctional Centre and Woodfood Correctional Centre for three months but was sacked the day after they found out.

“A review of the criminal history checking established that an administration officer mistakenly ticked the incorrect box on a form” she said.

Ms Morrison said there was no evidence of impropriety during Dann’s tenure, but did not say if other people with criminal histories had been employed as prison guards.

In similar circumstances, the Department of Public Works only became aware of the past of security guard Marino Katalinic, 36, after he held his job for 18 months.

He was sacked on May 31 this year after he was found guilty of impersonating a police officer and The Courier-Mail revealed he was wanted by Croatian authorities over drug and theft convictions from 2004.

Responding to the Government’s failure to pick up on Morehu-Barlow’s criminal history, Police and Corrective Services Minister Neil Roberts this week acknowledged flaws with the system.

The three cases raise serious questions about the State Government’s handling of employees’ criminal checks.

The latest revelations come as three senior health managers were stood down on full pay by Queensland Health yesterday pending an investigation into the failure to detect the illegal transfer of millions of dollars.

But the decision sparked fresh calls for Health Minister Geoff Wilson to be sacked as the Opposition insisted the Bligh Government had a long record of blaming only bureaucrats.

Police have charged Brisbane socialite and Health purchasing officer Joel Morehu-Barlow with one count of defrauding the department of $11 million.

An investigation last year cleared him of any wrongdoing despite a detailed complaint, while payments of $4 million to a trading entity set up by Morehu-Barlow are outlined in the department’s annual reports.

(Courier Mail, Alison Sandy and Steven Wardill, 15/12/2011)

Filed Under: Discovering a Fraud, Forensic Acccountant Tagged With: , ,

Accused Queensland Health fraudster Joel Morehu-Barlow lived it up with $11m lifestyle

16 December 2011 By

WHILE accused fraudster Joel Morehu-Barlow sits in a solitary jail cell at Wacol prison an entertainment package worth nearly $100,000 is en route from Europe for him.

Accused Fraudster Queensland Health

Accused Fraudster Queensland Health

Only days before the accused fraudster became the state’s most-wanted man and was eventually charged with defrauding $11 million, he was having the time of his life, enjoying a lavish spending spree.

The 36-year-old purchased an opulent $5.65 million River House in the new Pietra development at Moray St, New Farm, and paid for it in full.

But the spending didn’t stop there – his extravagant lifestyle was just beginning.

Court documents reveal Morehu-Barlow went on to purchase items including a top-of-the-range 2.15m 3D TV described as one of “the most expensive sets ever produced”.

He purchased the TV and associated accessories for $95,070 from Bang and Olufsen’s Fortitude Valley store. But little did he know the exclusive entertainment package which was sent from Denmark was due to arrive in Australia when he would behind bars.

The goods will be seized once they arrive in Australia.

During his short-lived spree he also purchased a luxury Mercedes-Benz and two top-of-the-range jet skis.

He also bought an elaborate, grey, 2009 Mercedes-Benz C63 AMG sedan for $135,214.

He then went on to buy two Sea-Doo jet skis at Brisbane Jet Skis at Zillmere on Brisbane’s northside.

One was a luxury performance model and the other a sports model, together costing more $42,000.

But he had little time to use his new plush toys, he would be arrested by police only eight days after he bought them. Documents show the self-proclaimed Tahitian prince was known by various names including Hohepa Morehu-Barlow, Joel Barlow, Joseph Barlow and Joel Hikairo Morehu-Barlow.

In the documents it reveals he held eight bank accounts with more than $1.5 million in them and another account in his company’s name which had a healthy balance of $2.91 million.

He also owned another two luxury cars – a grey, 2009 Mercedes-Benz C63 AMG sedan and a 2004, silver BMW 530i sedan.

Morehu-Barlow was also interested in music and art and had a selection of paintings and a baby grand piano.

(The Courier-Mail, Sophie Elsworth, 16/12/2011)

Filed Under: Discovering a Fraud, Finding Assets, Forensic Acccountant, Fraud Analytics, Investigation, Preventing Fraud, Warning Signs Tagged With: , ,

Accountant in $45m Banking Fraud

15 December 2011 By

Rajina Subramaniam defrauded her employer of $45 million.

Castle Hill Accountant in $45m Fraud

THE diamonds and sapphires were stored under her desk and never worn, the four multimillion-dollar beachside apartments left unattended.

And when detectives finally came to arrest the Sydney mother Rijina Rita Subramaniam for defrauding her employer of $45 million, not one of the luxury items she had bought with the money was among her personal possessions.

In one of the largest cases of fraud by a woman in NSW history, Subramaniam repeatedly siphoned off tens of thousands of dollars from ING Australia, where she was an accountant for more than a decade.

The 41-year-old from Castle Hill spent the money on seven prestige properties – including four units on Bondi Beach’s exclusive Campbell Parade – 600 pieces of designer jewellery, and 200 perfume and make-up items. But then she never touched them.

Yesterday the Downing Centre District Court was told that Subramaniam was motivated, not by greed, but by a desire for revenge over the allegedly abusive sexual relationship she was having with a workmate, and an overwhelming need for positive affirmation.

Subramaniam’s sentencing hearing heard that she had extremely poor self-esteem, due in part to the sexual abuse she allegedly experienced as a child at the hands of her grandfather and two uncles.

After getting involved with a colleague at ING, she came to perceive the relationship as abusive but continued to see the man for years. This alleged abuse and the feeling that her supervisors were bullying her led to a desire for revenge and to ”get back at the system and others within the system”.

According to Dr Stephen Allnutt, who was called as a witness for the defence, the flip-side of these feelings was a powerful desire for recognition and empowerment, desires that were fulfilled by spending money.

Judge Michael Finnane said that Subramaniam appeared to gain satisfaction from ”being applauded by [shop] assistants [who said] ‘how wonderful you’ve come back to us again, a wealthy woman like you and a woman of such discrimination and taste … we’ll only show you the very good stuff because you’re someone very special”’.

So grateful was she for the warmth and attention, Subramaniam gave one shop assistant $1.3 million to buy a house.

Subramaniam’s lawyer, Tim Game, SC, said Subramaniam should not be jailed because she would not be able to get the psychological care she needed.

Judge Finnane will hand down his sentence in February.

Sourced from: www.smh.com.au/nsw/womans-quest-for-selfesteem-and-revenge-cost-boss-45m-20111215-1owya.html#ixzz1gfN8sApi, Paul Bibby Courts, 16/12/2011. Image courtesy of stuff.co.nz

Filed Under: Discovering a Fraud, Forensic Acccountant, Investigation, Warning Signs Tagged With: , ,

Capital Gains Tax (CGT) and Divorce

28 March 2011 By

CGT and Divorce

Where there is a breakdown in a personal relationship, and the ownership of an asset changes, there is a CGT relief measure that applies.

Q. I am in the process of a divorce settlement. Together with my former spouse we own two investment houses and a business. We have decided to split 50-50, with her taking the investment houses and I keep the business, which she has not being involved in. She is taking the CGT into account for the houses and I’m not sure of the legalities of the CGT for the business and rental houses. All were purchased after 1993.

A. It’s interesting when you do a search on capital gains tax and divorce there is very little listed as being produced by the ATO. One of the few things that the ATO does offer is a list of assets that are CGT exempt. These include:

  • an asset acquired before September 20, 1985
  • cars, motorcycles and similar vehicles
  • compensation received for personal injury
  • disposing of a main residence
  • a collectable – for example antiques or jewellery costing $500 or less
  • a personal use asset acquired for $10,000 or less – for example, items such as boats, furniture, electrical goods and household items used or kept mainly for personal use or enjoyment. Land and buildings are not personal use assets
  • disposing of an asset to which the small business 15-year exemption applies
  • the exchange of shares and units owned in a company or trust that is taken over, if certain conditions are met, and
  • shares in a company or interests in a trust where there has been a demerger and certain conditions have been met.

Although not strictly an exemption, there is capital gains tax relief that applies where the ownership of an asset changes as a result of divorce. The relief is in fact not optional and must be applied where a legally binding agreement has been entered into. This could be an agreement imposed by the family court or one mutually agreed between the parties to the divorce.

Under the rollover relief that must be applied in the case of a divorce agreement there are no capital gains tax implications for the person disposing of an asset. The person who receives the asset as a result of the divorce agreement takes over all of the CGT history related to the asset.

In relation to the divorce settlement with your wife this will mean the rental properties being transferred to her will be regarded as being purchased by her when you purchased them as a couple. There is no capital gains implication for you but she will pay CGT when she sells them if the net sale proceeds exceed the cost paid by you as a couple.

With regard to the business that you will be retaining, there is no capital gain payable by your wife. When the business is sold you may be able to take advantage of the various small business capital gains tax concessions. These include the 15 year asset exemption, the 50 per cent active asset exemption, and the retirement exemption. To be eligible for these concessions you must either have a turnover of less than $2 million or meet the other criteria.

(Source: CGT is as certain as death and taxes, Max Newnham, 28/3/11, SMH Money)

Further Information

If you would like further information about using our forensic accounting services for a divorce, litigation, asset search, or other forensic accounting matter, then please contact us for an obligation free discussion. We provide services to corporations, law firms and individuals in Sydney, Brisbane, Melbourne, Adelaide, Perth and across Australia. Call now on (02) 8019 7262.

 

Filed Under: Family law, Forensic Acccountant Tagged With: , , , ,