Bernard Madoff's accountant arrested on fraud
USA Today ran the story Friday about Bernie Madoff's auditor, David Friehling, being arrested and released on a $2.5 million bond. If you thought you knew the depths of the audit industry, you've got to track this story down. For another, deeper view on the matter, see this ABC story.
At the next AICPA annual convention, I'd love to host a breakout session called "How to audit clients like Bernie Madoff". During the breakout, I'd explore how a firm can:
- "perform anything remotely resembling an audit" - further the fraud - shield the client from scrutiny - invest in its client's business - tell the SEC and AICPA it doesn't do audits but still imply to investors they were
Yes, it would be a standing room only event. Only the breakout room with the Barclay's folks explaining how to structure muilti-billion dollar tax shelters would draw better. If you haven't been following that story, start here with fellow Enterprise Irregular Dennis Howlett's piece and keep clicking on all of the links (especially those of the Guardian and WikiLeaks).
Yes, these are heady days for service firms (and the lawyers who will no doubt be defending them).