• Accounting News Roundup: Liz Warren to Be Geithner’s Sidekick; Chicago Accountant Gets 23-Year Sentence for Ponzi Du Jour; Gibbs, Boehner Tweet Over Tax Cuts | 09.16.10

    By | September 16, 2010

    White House Taps Consumer Adviser [WSJ]
    “President Barack Obama this week will appoint Elizabeth Warren to a lead role setting up the new Bureau of Consumer Financial Protection, two Democratic officials said, a move that will allow the White House to avoid a messy Senate fight over her role.

    Ms. Warren, currently a professor at Harvard Law School, will be named an assistant to the president and special advisor to Treasury Secretary Timothy Geithner in charge of launching the new agency and setting its mission. She was a candidate to be the agency’s first director, a position that remains unfilled, but would likely have had trouble securing confirmation because of opposition in the Senate.”

    What is Accounting? [White Collar Fraud]
    It’s sort of like arithmetic but not really. Former Sam Antar nemesis, Howard Sirota, explains in a video over at WCF.

    Chicago-Area Man Is Sentenced to 23 Years for Running 22-Year Ponzi Scheme [Bloomberg]
    “Frank Castaldi, who ran a Chicago- area Ponzi scheme for 22 years that cost victims $31.6 million, was sentenced to 23 years in prison today in federal court.

    For 22 years, Castaldi, 57, of suburban Prospect Heights preyed upon elderly Italian immigrants, U.S. District Judge John Darrah said today before handing down the sentence.

    ‘This is an offense of huge magnitude,’ the judge said after hearing from victims of the scheme in a packed courtroom. ‘It involved hundreds of victims. It involved millions of dollars.’

    In an August 2009 plea agreement, Castaldi said he had raised more than $77 million from 473 groups and individuals. First charged in January of last year, he admitted to mail fraud and to trying to thwart a U.S. Internal Revenue Service probe.”

    Regulators to Target ‘Window Dressing’ [WSJ]
    “Federal regulators are poised to propose new disclosure rules targeting “window dressing,” a practice undertaken by some large banks to temporarily lower their debt levels before reporting finances to the public.

    The Securities and Exchange Commission is scheduled to take up the matter at a meeting Friday and is expected to issue proposals for public comment. The action follows a Wall Street Journal investigation into the practice, which isn’t illegal but masks banks’ true levels of borrowing and risk-taking.”


    Banks take over record number of homes in August [Reuters]
    “A record number of homeowners lost houses to their banks in August as lenders worked through the backlog of distressed mortgages, real estate data company RealtyTrac said on Thursday.

    New default notices decreased at the same time, suggesting that lenders managed the flow of troubled loans and foreclosed properties hitting the market to limit price declines, the company said.

    Root problems of high unemployment, wage cuts, negative home equity and restrictive lending practices persist, however, pointing to lingering housing market pain.”

    Jon Stewart: Robert Gibbs and John Boehner on the Bush Tax Cuts [TaxProf Blog]

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    • Guest

      Pretty much every large firm partner falls into those categories. How many times you think that dinner out with the CFO gets written-off even after getting reimbursed and charging the client for it?

      • sfsee

        Pretty aggressive claim…extremely doubtful that a lot of partners would fall into this category. Would a partner at (insert big-4 name here) have access to the tax group to assist with his/her return? If that is the case, it is pretty unlikely anyone (other partners, etc.) would let that fly…if nothing else it is too risky to the rest of the firm.

        • Guest

          Your head is in the sand if you think audit partners are letting someone other than themselves do their tax return. Show me an audit partner over the age of 50 that lets someone else touch their return.

          • sfsee

            I’d actually be really interested to know if there is some kind of requirement (legal or firm policy) that partners have to had some kind of oversight on their returns. By definition it seems that accounting firms are risk averse, so I don’t see any reason they’d let their staff be cowboys with their tax returns.

            My buddy works at one of the big 4 and when he got back from an overseas tour the firm basically required that a group within the tax service handle his returns (to avoid the troubles of international versus US tax codes I suppose). If they are worried about managers , I’d bet they worry about the more senior staff as well.

          • sfsee

            I’d actually be really interested to know if there is some kind of requirement (legal or firm policy) that partners have to had some kind of oversight on their returns. By definition it seems that accounting firms are risk averse, so I don’t see any reason they’d let their staff be cowboys with their tax returns.

            My buddy works at one of the big 4 and when he got back from an overseas tour the firm basically required that a group within the tax service handle his returns (to avoid the troubles of international versus US tax codes I suppose). If they are worried about managers , I’d bet they worry about the more senior staff as well.

      • Cachi Romero

        If you entertaining a client, a partner would have a corporate card that get’s charged to the company’s FS, which if they are coding it correctly would be subject to 50% TE exclusion reported on the partner’s k-1 as a non-deductible expense.

        • Guest

          You think partners are using corporate cards? Hell no – they’re using their own AmEx or Citi card and racking up their own miles on expenses. You people are lost.

    • Guest

      I love how I read these articles on CNN, among other publications, then I see them on GC where the article is “thrown to the wolves”. Keep it coming!