2nd Edition
Criminal Financial Investigations The Use of Forensic Accounting Techniques and Indirect Methods of Proof, Second Edition
Understanding the financial motivations behind white collar crime is often the key to the apprehension and successful prosecution of these individuals. Now in its second edition, Criminal Financial Investigations: The Use of Forensic Accounting Techniques and Indirect Methods of Proof provides direct instruction on the "how to" aspects of criminal financial investigations, taking readers through the different approaches used in gathering evidence and demonstrating how to present circumstantial evidence to a judge or jury in a simple and convincing manner. Simplifying how the financial pieces fit together, this text:
- Presents the logic and reasoning involved in constructing a financial criminal investigation
- Describes the requirements for legal acceptance of forensic accounting investigations
- Includes relevant examples of the step-by-step processes involved in financial investigations
- Explores the pitfalls—and how to avoid them—in financial investigating
- Contains two investigations with step-by-step procedures from initial inquiry to case completion—for use as term or topical assignments or to promote class discussion
New Chapters in the Second Edition:
Written by a former Special Agent with the Criminal Investigation Division of the U.S. Internal Revenue Service, this volume sets out a successful methodology enabling readers to identify, pursue, and successfully prosecute financial white collar crime.
Introduction
What Is Forensic Accounting?
Criminological Theories
Motive
Opportunity
Financial Crimes
Legal Requirements
The Financial Disciplines
General Business Operations
Providing Goods
Providing Services
Providing Ideas
Record Retention
Basic Accounting
Books and Records
Basic Tax Law
Regulatory Agencies
Characteristics of Financial Crimes
Spending
Saving
The Structure
Conspiracy
Fraud
Categories of Theft
Theft
Burglary
Larceny
Robbery
Embezzlement
Swindle
Schemes
The Paper Trail
What Is the "Paper Trail?"
What Does the Paper Trail Look Like?
Check Registers
Stocks and Bonds
Real Property
Vehicles
Other Assets
Jewelry
Furs and Clothing
Collectibles
Antiques
Philately
Numismatics
Artwork
Liabilities
Collecting and Preserving Evidence
Interviewing
Gathering Documentary Evidence
Documentation
Relevance
Materiality
Competency
Gathering Evidence through Observation
Observation
Surveillance
Moving Surveillance
Electronic Surveillance and Monitoring
Telephonic Intercepts
Undercover Operations and Body Wires
Search and Seizure
Reasonable or Unreasonable
Probable Cause
Oath or Affirmation
Particular Description
Preparing an Affidavit for a Search Warrant
The Affidavit
The Affiant
Probable Cause
Oath or Affirmation
Particular Description
Executing the Warrant
What Is a Financial Investigation?
The Theory behind Indirect Methods of Proof
Requirements for Indirect Methods of Proof
The Standard Methods of Proof
Specific Items
Bank Deposits and Cash Expenditures
Net Worth and Personal Expenditures
Hybrid Methods
Percentage Markup
The Cash-T
What Processes Are Common to All Indirect Methods of Proof?
Starting Point
Likely Source of Income
Identify All of the Players
Following All Available Leads
Mathematical Accuracy
Addressing Potential Defenses
The Cash Hoard
Personal Loans
Denial of True Ownership
The Specific Items Case
Case Summary
Evidence Developed
Other Information
The Bank Deposits and Cash Expenditures Case
Case Summary
The Net Worth and Personal Expenditures Case
Case Summary
Cash on Hand
Cash in Banks
House: Maple Street
New House
Donut Shop
Stocks and Bonds
Ford Taurus
Jeep Cherokee/Lincoln
Colorado Condominium
Indirect Methods in Tax Investigations
Types of Tax Crimes
Understating Income
Overstating Expenses
Other Tax Crimes
Tax-Related Crimes
False Returns
False Preparer Schemes
Tax Shelter Schemes
Unique Aspects of Criminal Tax Investigations
Additional Steps Needed in Tax Cases
The Case Report
Introduction
Recommended Charges
History of Subjects
Business History
Theory
Venue
Starting Point
Likely Source of Income
Evidence of Intent
Evidence
Defense of Subject
Conclusions and Recommendations
Preparation for Trial
Packaging the Evidence
Grand Jury Presentation
Pretrial Conferences
Pretrial Interviews
The Trial
Innovative Applications
Forfeiture
Money Laundering
Financial Investigating and Counterterrorism
Biography
Gregory A. Pasco is a professor of criminal justice at Colorado Technical University’s Sioux Falls, South Dakota campus. Pasco spent more than 28 years in federal law enforcement as a special agent with the Criminal Investigation Division of the Internal Revenue Service (IRS). During this time, he conducted more than 100 financial criminal investigations. He worked in the IRS Organized Crime Unit in Detroit, Michigan, and with the Narcotics Task Forces in New Mexico and Ohio, and completed his federal law enforcement career in South Dakota. During his career, Pasco became qualified as an expert witness in criminal tax computations and was accepted as such in federal district court. He was also called upon to provide electronic surveillance and monitoring assistance in other investigations, and was qualified and testified as an expert witness in this area in federal district court. He has also been qualified as an expert witness in the area of money laundering.
