Categories: Asset Recovery

On behalf of a major global transportation company, White Collar Forensic performed an internal investigation of the suspected theft of equipment.  The investigation included in-depth background investigations of suspect employees, the acquisition and analysis of over 4 million emails and electronically stored evidence, imaging and analysis of computer hard drives, witness and admission-seeking interviews, forensic accounting and loss quantification analyses, and preparation of a detailed investigative report in support of a fidelity insurance proof of loss. The matter also entailed the making of a criminal referral to the U.S. Attorney's Office and Federal Bureau of Investigation and the joint performance of a root cause analysis together with an ad hoc team assembled by the chief compliance officer to identify internal control gaps for remediation. The investigation documented the theft of nearly $7 million of equipment, led to a successful criminal referral and an insurance claim which was paid at its maximum face value.

A non-US development bank retained WCF personnel through outside counsel to perform forensic accounting analyses, compliance reviews, background investigations, image and analyze over 100 devices and email accounts in connection with allegations that develop loans and investments were made improperly because of a corrupt relationship between one or more public officials and bank executives. The investigation provided vital evidence to outside counsel enabling them to successfully argue defend the bank in criminal and civil proceedings.

A WCF professional oversaw a private bank’s investigation of the embezzlement of $66 million from a bank customer who had corrupted and conspired with the private bank’s general manager. This customer ultimately was able to open numerous private banking accounts that included substantial lines of credit secured by fraudulent collateral, drew down all of the lines of credit to their maximum and then defaulted. The investigation included an extensive review and analysis of numerous private banking accounts, millions of dollars of foreign transfers to related parties and individuals, including public officials, background investigations of the beneficiaries of those transactions and surveillance of the general manager’s residences once it had been determined that he was attempting to flee the jurisdiction. The culmination of these forensic accounting analyses was a criminal referral to the FBI and a successful insurance claim against the bank’s fidelity policy enabling them to recover most of their losses.

On behalf of a medical equipment manufacturer and their counsel, a WCF executive oversaw a forensic accounting investigation of an elaborate fraudulent scheme in which two company executives based in Europe improperly entered into leasing agreements of medical equipment in which they provided 100% financing of medical facilities that were constructed to house the medical equipment and 2 different versions of the leasing agreement. The English language version submitted to corporate headquarters approval contained the company’s standard terms and conditions whereas the foreign language version of those agreements contained very generous terms that favored the customer leaving the company with little to no recourse or collateral in the event of a default. These fraudulent lease agreements caused the company to incur a huge amount of defaults and a loss of over $50 million. The resulting investigation and forensic analysis revealed that the two employees had entered into side agreements with these customers in which they received kickbacks with the understanding that the customers would receive the medical equipment and facility and then default knowing that the company had no recourse. The investigation included intensive data analytics and forensic accounting, dozens of data visualization charts and graphs showing improper relationship and money flows and enabled the company to recover $56 million of their $60 million loss in an insurance claim.

In connection with a Securities Investor Protection Corporation liquidation matter, a WCF executive oversaw the analysis and disposition of assets belonging to the broker dealer and its executives who were involved in insider trading and a series of pump and dump schemes. The team used data analytics to analyze over 10 million outbound phone calls in an effort to identify assets recoverable to the trustee who could then return assets to victims. The phone records analysis revealed that hundreds of calls were placed to banks, law and accounting firms located in several offshore, money laundering safe haven countries enabling the investigative team to identify financial institutions where some of the proceeds of the fraud had been transferred. This effort enabled the trustee to pursue the repatriation of those assets through Mutual Legal Assistance Treaty requests and letters rogatory procedures.

A development bank whose mission is the encourage commerce between the U.S. and Indonesia was defrauded by one of its customers in connection with a $5 million loan which was subsequently defaulted on. The borrower was involved in the importation and sale of a commodity which was then sold through U.S. based distributors. The investigation revealed that the founder and chief executive of the company in default had established an alter ego business in a neighboring state under a different name but had continued to sell to the same customers he had identified to the bank in his loan application. This finding enabled the bank to place liens against the receivables and inventory of this newly established venture and ultimately recover the full amount of them money judgement against the borrower.

A major private equity firm with a fund that included numerous parcels of commercial real estate in its investment portfolio was defrauded by its fund manager. The manager was charged with the operations and maintenance of the various properties including the receipt of rent, improvements, tax payments and maintenance. The employee mischaracterized several million dollars of personal expenses as business expenses instead using company funds to pay for his lavish lifestyle that included several homes, luxury travel and a collection of ultra-expensive luxury vehicles such as Lamborghinis and Ferraris. The investigation was able to separate the legitimate property management expenses from the personal living expenses that were being misidentified as business-related.