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We are pleased to announce that the founding partners of Radius Investigations, Matthew Seifer and Sinai Megibow, will be speaking at the next meeting of the Attorneys/Accountants Committee of the Nassau County Bar Association.  Our topic will be:  How to Protect Your Business and Your Clients from Computer Fraud, and How to Recover Forensic Data from Computers and Devices.  The presentation will take place on Wednesday, November 2, 2016 at 12:30 p.m. in the South Dining Room at the Nassau County Bar Association in Mineola.  We look forward to an interesting discussion!

For more information, please contact Radius Investigations at 1-888-698-0077, or email us at m.seifer@RadiusInvestigations.com

PRESS RELEASE

SEPTEMBER 27, 2016

More than 21 months ago, the Village Board and Village Attorney received a report alleging that a Village employee had utilized two background‑search firms (Transunion/TLO and Lexis Nexis) with one of the firms’ extensive, law-enforcement databases accessed under the pretense of the employee being the Village’s “Chief of Police”. In the latter case, this enabled the employee to undertake the most invasive searches of individuals’ backgrounds. The searches that were made were not for a legitimate governmental purpose or work-related in any way. Additionally, families, friends and associates of certain individuals were also searched without any lawful or legitimate purpose, including certain Village-Board candidates, sitting Village Trustees and Village employees.

At that time, the Village’s investigation of the searches was taken over by the then-Village Attorney. Approximately two weeks later, the employee in question was separated from service.

Not receiving any further information concerning the extent of these searches and being concerned about the Village’s legal obligations to address these matters, in April 2015, when Mayor Maura P. Spery’s administration took over, the Board engaged the services of two forensic‑investigation companies, one of which focused on computer and IT‑related matters and the other on finance-related matters. The two finance-related reports were completed by Cramer CPA, P.C. in December 2015 and January 2016, and the results of each have been forwarded to appropriate external agencies, including the Suffolk County District Attorney’s Office and the New York State Comptroller’s Office. The determinations in these reports included a clear pattern of employees’ theft of services and other financial improprieties.

Due to the complexities of the IT-related information that was uncovered during the nearly 18-month inquiry, the IT-forensic report that was conducted by Radius Investigations was recently finalized. This latest report now enables the Village Board, with the advice and guidance of its attorney, to comply with both federal and state laws requiring the Village to notify in writing all individuals who may have been impacted by these illegal and impermissible searches.

Some of the targets of these illegal searches included elected Village officials, Village employees and Village residents. The former employee who conducted these searches did so using computers connected to both the Village of Mastic Beach and the Village of Northport. Consequently, the Village yesterday mailed out written notices to nearly 500 individuals in accord with the Village’s statutory obligations, including among others New York State Technology Law, Section 208 and New York State General Business Law, Section 899-aa.

Accordingly, the Mastic Beach Village Board, through its attorney, has turned over the IT-forensic investigation report and related information to various state agencies, including the Suffolk County District Attorney’s Office and the New York State Attorney General’s Office.

Mayor Maura P. Spery stated, “There have been loud cries over the past 18 months about the nature of the Village’s IT investigation and whether it was even needed. It has been labeled by detractors as merely a ‘witch hunt’. Certainly, the results of the reports the Village has received prove otherwise and make unequivocally clear the serious transgressions that occurred, including the digital violation of individual privacy and confidentiality.” Mayor Spery concluded, “The residents of Mastic Beach Village need to know my administration continues to take very seriously our obligations to provide transparency and accountability to our constituents.”

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MAYORAL STATEMENT

SEPTEMBER 27, 2016

With the release of the Village’s IT-forensic investigation findings, and after more than 21 months of public vitriol leveled against former Deputy Mayor Bruce Summa and me, we have been fully vindicated.

During the past 21 months, Mr. Summa and I have been publicly accused of seeking to destroy families, committing heinous crimes and abusing our governmental power. Nothing could be further from the truth.

Make no mistake, this is an extremely dark day in the Village of Mastic Beach. Mine and Mr. Summa’s commitment to transparency and accountability has come at a tremendous personal cost not just to us but to our families and friends, many of whom were the subjects of these illegal and invasive searches. Nonetheless, we undertook our elected positions with an unyielding commitment that no individual should ever be afraid of her/his government or fear retribution for expressing one’s fundamental Constitutional right of free expression, even if that expression opposes the current political majority’s viewpoint. I continue to have faith in our system of government and now look to our law-enforcement agencies to hold accountable those who shredded the Constitutional rights of the hundreds and hundreds of innocent victims whose backgrounds were illegally searched and the digital invasion they suffered. Justice demands nothing less.

To combat fraud effectively, you first must understand what it is and how it occurs. For our purposes, the definition of fraud from Wikipedia is sufficient:
In law, fraud is deliberate deception to secure unfair or unlawful gain. Fraud is both a civil wrong (i.e., a fraud victim may sue the fraud perpetrator to avoid the fraud and/or recover monetary compensation) and a criminal wrong (i.e., a fraud perpetrator may be prosecuted and imprisoned by governmental authorities).

https://en.wikipedia.org/wiki/Fraud

In other words, fraud requires the perpetrator to use trickery, deceit, or lies to obtain some form of benefit – often money directly, but it could be other benefits, such as health insurance, a job, merchandise, better stock value for the company, etc.

Now, there are as many different types of fraud as there are things to lie about. For now, I will focus on the types of fraud and related forms of theft that specifically target the business and the workplace. I’ll begin with the most common types of employee fraud: Asset misappropriation, embezzlement, and employee theft.

Asset Misappropriation, Embezzlement, and Employee Theft

Generally, these types of fraud/theft affect either the company’s cash or its inventory or physical assets. Frauds affecting the company’s cash or revenues include the following:

• Larceny: stealing from cash on-hand or deposits
• Skimming:
  • From Sales, by understating the value of goods sold, or not recording the sales of goods, and pocketing the cash
  • From Receivables, through write-off schemes, “lapping” schemes (pocketing payment from a customer, then using the next customer’s payment to cover the shortfall), etc.
  • From refunds
• Fraudulent Disbursements:
  • Billing schemes – charging the company for non-existent work performed by shell companies, inflating the bills from vendors and pocketing the difference, etc.
  • Payroll Schemes – “ghost” employees (pocketing paychecks for employees that don’t really exist), falsified commission schemes, fraudulent workers’ compensation claims, falsifying or inflating wages owed, falsified vacation time
  • Expense reimbursement schemes – mischaracterized/overstated expenses, fictitious expenses, multiple reimbursements, billing the company for personal and not business expenses
• Check Tampering
  • Forged maker
  • Forged Endorsements
  •  Altered Payee
  • Authorized maker
  • Concealed checks
• Register Disbursements
  • False voids
  • False refunds

Frauds affecting the company’s inventory include the following:

• Misuse – using the company’s equipment (vehicles, etc.) for unauthorized personal use.
• Larceny – Stealing the company’s inventory or equipment, through falsified sales and shipping documents, purchasing and receiving documents, or simply stealing.

In a future blog post, I’ll summarize fraud in the form of falsified financial and business statements and corruption.

For more information on fraud schemes and how you can protect yourself, contact Radius Investigations at 1-888-698-0077, or info@RadiusInvestigations.com.

If you own or run a business or organization, then you need to be concerned about fraud or internal theft. Fraud is a major problem that can, and has, affected organizations of all kinds, from businesses to non-profits, from small mom-and-pop stores to multi-national corporations.

Every year, the most respected anti-fraud organization in the world, the Association of Certified Fraud Examiners, releases its annual Report to the Nations. The Report is a comprehensive analysis of fraud – who is affected, how it occurs, and how much it costs. The 2016 Report revealed some frightening statistics:

• A typical victimized organization loses 5% of revenue in a given year due to fraud
• Median losses due to fraud are approximately $150,000
• 23% of cases caused losses of $1 million or more.
• For-profit organizations were targeted in two-thirds of reported cases, and had higher median losses.
• Median losses for small organizations (with less than 100 employees) were the same as those incurred by the largest organizations (with 10,000 or more employees) – but those losses have much greater impact on small entities.
• Most occupational fraudsters are first-time offenders – only 5.2% of reported offenders had previously been convicted, and only 8.3% had previously been fired for fraud-related conduct.

The bottom line, of course, is that the leaders of every organization need to take the risk of fraud seriously, learn how they may be vulnerable to fraud, and take steps to protect themselves.

In future blog posts, I will detail common fraud schemes, case studies of notable large and small frauds, and strategies for how you can fortify your organization against the threat of fraud or internal theft.

For more information, contact Radius Investigations at info@RadiusInvestigations.com or call us at 888-698-0077.

Reuters recently reported that the large pharmaceutical company, AstraZeneca, will pay $5.52 million to the U.S. Government to resolve a foreign bribery probe. The SEC and the DOJ investigated AstraZeneca for alleged improper payments made by its sales and marketing staff to state employees in China and Russia. The company denied any wrongdoing in the settlement.

AstraZeneca was investigated for violations of the Foreign Corrupt Practices Act (the FCPA), which basically prohibits companies that operate in the United States from bribing foreign government officials to gain access to those countries’ markets. As this settlement makes clear, the FCPA has sharp teeth. The payment of settlements, fines, sanctions, and the cost of conducting investigations and litigating FCPA violations can run well into the millions, even without any actual convictions or judgments.

So how can companies seeking to tap into lucrative foreign markets protect themselves from misconduct by their overseas employees or agents? Many companies hire local consulting firms or business agents to act as their representatives in foreign markets in order to keep their costs down. How can these companies be sure that their foreign representatives act in a way that complies with U.S.-based legal and ethical standards? And how can they do it in a cost-effective way?

As with many challenges, preparation is key. In this case, preparation involves conducting robust legal, practical, and reputational due diligence focusing on these prospective local agents and employees. For this type of due diligence investigation to be most effective, it must combine two parts. First, it must utilize local, “boots on the ground” resources that know the culture, systems, and policies of the country at issue. Second, it must have an objective, third-party perspective that blends the local know-how with an understanding of how those issues may affect U.S. companies’ risk exposure, liabilities, and reputation. The process is not a simple one, but a robust due diligence investigation, conducted by seasoned, objective professionals, can save businesses millions in legal fees, fines and penalties, and settlement costs – not to mention the potential damage to reputation and brand.

The article reporting AstraZeneca’s FCPA settlement can be found at:
https://www.channelnewsasia.com/news/business/astrazeneca-to-pay-us-5-5/3087376.html

For more information on conducting international due diligence and background investigations, contact Radius Investigations at 631-351-6473 or info@RadiusInvestigations.com

In general, the police are very careful and well equipped with the knowledge required to determine when to make an official arrest. But, unfortunately, there are always exceptions. A wrongful arrest can happen for any number of reasons--mistaken identity, being in the wrong place at the wrong time, an over zealous police officer, or even--rarely-- intentionally due to malice. In any case, being the victim of a wrongful arrest is always a traumatic experience.

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Investigations, by definition, involve the collection of information. Depending on the type of investigation being carried out, different methods may be used to collect such information.

All investigations involve the gathering of facts--usually this is done through overt interviews with witnesses and experts, review of documents or evidence, and the collection of information using reports and forms and the like. These methods often suffice in getting to the bottom of the matter at hand. However, when someone who is the subject of an investigation is trying to hide something, it might be necessary to employ more unorthodox techniques to find out what’s really going on. It is situations like this where covert surveillance can be a valuable tool.

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States require employers to provide workers’ compensation insurance to cover an employee’s lost wages due to an injury on the job.

It’s a sad fact that to some unethical workers, workers’ compensation claims look like a ticket to getting paid for not working. Whether it’s exaggerating the extent of an injury or outright faking it, it’s illegal and costly to employers, insurers and society as a whole. It raises insurance costs for all businesses.

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It’s a grim statistic, but infidelity investigations indicate that well over 50% of spouses or partners are unfaithful at some point in a marriage or relationship.

The first sign may not be anything tangible at all, but rather a “gut feeling.” But how can you tell if your gut feeling is justified, or if it’s just your imagination? Take a look at the five signs below and see if your spouse is exhibiting any of the behaviors described--if so, it might be worth hiring a private investigator that conducts infidelity investigations.

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As the use of social media explodes, so does its use in divorce proceeding investigations. Lawyers are increasingly using content from social media and other electronic communication as evidence in divorce cases. Therefore, it is important not only to protect yourself by limiting what you communicate on social media while you are going through a divorce, but also to ensure your lawyer exploits whatever information your ex-spouse is indiscreetly making available over their social media channels.

More and more it is possible to use such information to support allegations of hidden assets, substance abuse, illicit affairs and the like. These revelations can have serious impacts on decisions from everything from child custody to alimony payments and settlement amounts.

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Radius Investigations has helped many law firms involved in litigation. We excel at doing what is necessary for lawyers to succeed in court, including: finding witnesses, locating hidden assets, verifying injury claims, uncovering evidence to help criminal defendants, and more.

If you're an attorney involved in litigation and need of our help please contact us at (888) 698-0077.

Last month was one of great sadness for America, but a sadness which comes with a bitter sense of familiarity. With the world still reeling from news of the on air murders of a reporter and a cameraman in Virginia, people are once again asking themselves ‘How was this allowed to happen?’

In a country where gun crime is endemic, where few people want to give up the right to bear arms, is it still possible to protect ordinary people? What measures need to be put in place to make sure that people like WDBJ-TV reporter Alison Parker and cameraman Adam Ward do not get caught in the cross-hairs of somebody who should have been labeled a danger from the start?

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