ACFE Awards First Cliff Robertson Sentinel Award to Namesake

The respected actor is honored for standing up to the duplicitous Hollywood establishment and lends his name to an award that will honor other whistle-blowers "For Choosing Truth Over Self."

Whistle-blowers are not revered in our society. According to Joseph T. Wells, CFE, CPA, Chairman and founder of the ACFE, they often are labeled as bigmouths, busybodies, snitches, tattlers, and troublemakers. "And as CFEs, we wonder why employees don't come forward and tell us of the frauds they know about," he said shortly before he presented the ACFE's first Cliff Robertson Sentinel Award to its namesake at the 14th Annual Fraud Conference & Exhibition, Aug. 3-8.

"Cliff Robertson didn't come forward to get rich; he was already rich," Wells said. "And he certainly didn't tell the truth about (movie mogul) David Begelman to become famous; Cliff was already famous. He did the right thing for one and only one reason: because it was the right thing."

Wells said that Robertson is one of many brave persons to come forward. "If we are ever to turn the corner on fraud," Wells said, "we must have the help of these people society has tarred forever with being 'whistle-blowers.' And we certainly need to call these heroes by a different name. They are actually corporate sentinels - our front line of defense against wrongdoing. We must remember their heroic sacrifices."

The ACFE and Robertson have established the Sentinel Award to recognize annually the selfless act of coming forward for the sole purpose of righting a wrong. The award carries the inscription, "For Choosing Truth Over Self." ACFE members will be able to nominate future candidates for the Sentinel Award.

And for the second year, the ACFE presented its Outstanding Achievement Awards to members and chapters at the conference. The recipients all share the common criteria of 1) being an Association member or chapter in good standing; 2) contributing significantly to the prevention, detection, or investigation of fraud; and 3) contributing significantly to the discipline of fraud examination.

Following are the recipients: Chapter of the Year, Toronto Chapter; Certified Fraud Examiner of the Year, Robert DiPasquale, CFE, CPA; Associate Member of the Year, Jon McDowall; The Hubbard Award, Craig L. Greene, CFE, CPA; Newsletter of the Year, Vancouver Chapter; Outstanding Achievement in Anti-Fraud Education, W. Steve Albrecht, CFE, CPA, CIA; Outstanding Achievement in Commerce, Richard Lanza, CPA; Outstanding Achievement in Government, John Fisher Weber, CFE, CPP; Outstanding Achievement in Law Enforcement, Tyler A. Smith, CFE; Outstanding Achievement in Outreach/Community Service, Robert McCloud, CFE; and Outstanding International Member, Alfredo Ruben Popritken, CFE, CPA.

Joseph R. Dervaes, CFE, ACFE Fellow, CIA, after receiving the ACFE's Donald R. Cressey Award, said he preferred "to be known as a fraud educator" and he was destined to "educate and train other professionals about my life experiences in the fascinating and ever-changing world of fraud. ... Fraud education has become an imperative for me. It should be for you too. It's one thing to know about fraud concepts for yourself. But I've found that this just isn't good enough. To be truly satisfied, we must share what we know with others so that they don't have to duplicate our life experiences. ... If each one of us builds on the firm foundation of others, think what an enormous contribution we could make, collectively, in the fight against fraud."

Dervaes is the audit manager for special investigations for the Washington State Auditor's Office. He is a former chairman of the ACFE Board of Regents and a Fellow of the Association, received the Association's Distinguished Achievement Award, and is the author of the Fraud's Finer Points column in The White Paper.

Board of Regents chair Karen Tierney, CFE, encouraged attendees, especially Certified Fraud Examiners, to spread their knowledge among their peers and in their communities. "The CFE designation is not just letters attached to your name," she said. "As a CFE, you have the ability to promote a positive perception which serves as an effective means for an organization to incorporate change and lead executives to strive for improvements in the prevention, detection and deterrence of fraud," she said. "The local chapters are the backbone of the ACFE as they are comprised of members volunteering their time for a mission. I encourage you to join your local chapter and be an active participant," Tierney said.

During the Pre-Conference, Craig Greene, CPA, instructed a large group on the intricacies of vendor audits including identifying suspect vendors, conducting vendor fraud audits, and post audits. Many conferees stayed for the Post-Conference, the "Auditors/Investigators Fraud Seminar."

Main Conference participants attended 40 breakout sessions in 10 tracks ranging from Investigating by Computer to Fraud Prevention. They also heard from Thomas Golden, CFE, partner-in-charge of the Midwest region investigations practice for PricewaterhouseCoopers; Don Rabon, renowned instructor of interview techniques; and reformed fraudster Tim Sasak.

General Session Speakers Challenge and Instruct
Thomas Golden, CFE, CPA, in his General Session talk, "The Role of the CFE in Restoring Public Trust," said that the CFE's day has arrived. "In the face of all this lack of trust in our capital markets there is no better time to be a CFE," Golden said. "It is our time to take our rightful place in the corporate reporting chain in providing assurance to the capital markets that management's representations do in fact depict the true financial health of their companies."

In the aftermath of the recent corporate debacles, Golden said, the public has asked, "Where were the auditors?" Golden said the public is an impatient group of stakeholders. "Their trust is fragile indeed - easy to lose and hard to regain," Golden said. "But regain we must because our very existence as a free society depends on it." He said "trust but verify" should become the new credo of "all financial statement auditors as they perform their duties of assuring that the information disseminated by management does in fact accurately depict the true financial picture of the company being audited."

Golden contended, however, that auditors "have neither the training or experience to effectively detect financial fraud and without some severe intervention, that fact will not change in the near-term." Golden gave a number of ways to help "stem the tide of this fraudulent epidemic": 1) auditors should take ACFE courses and earn the CFE accreditation; 2) colleges should think about providing mandatory investigations course work; 3) the AICPA can put pressure on colleges to teach forensic accounting to all accounting students; and 4) audit committees and auditors must recognize that they are most at risk when indicia of fraud has surfaced; someone must review that evidence and make a determination as to what procedures to perform to resolve the issue. Golden said his Big Four accounting firm uses auditors as "smoke detectors" and fraud investigators as "firemen": the smoke detectors do not intrude on a crime scene but immediately call the firemen when they suspect fraud.

Don Rabon, in his General Session presentation, "Intuition and the Interview Process," said that intuition is much "more than just a feeling" but is a process that comes from several years of interviewing experience. He said intuition is "a mode of understanding, a knowing characterized as direct and immediate and occurring without conscious thought. It is a response to subtle cues and relationships apprehended implicitly, unconsciously." The cues include verbal, vocal, and nonverbal, he said.

Rabon said there are two types of memory: implicit and explicit. Explicit knowledge "knows that" but implicit knowledge "knows how," he said. An example of implicit memory, he said, is developing rapport with an interview subject. "Somehow or another, you've got to get on their level," he said. " 'Some-how or another' involves a set of specific evaluations - subtle verbal, vocal, and nonverbal cues - and reactive steps - responses - in to order to get - obtain a desired relationship - on their level or reality," he said. He showed a number of videotaped interviews in which the interviewers mirrored the body language of the subjects. Eventually the subjects mirrored the interviewers and the interviewers knew that they had the subjects' rapport.

"As interviewers we can discover how to tap into our intuitive resources," Rabon said. The components, he said, include expertise ("Chance favors only the prepared mind." - Louis Pasteur), imaginative thinking skills, venturesome personality, intrinsic motivation, and creative environment (establishing a system wherein those who interview as part of their profession are mentored, challenged, and encouraged by others).

Tim Sasak, former seller of fraudulent mortgage-backed securities products, gave a little background on how some good deals went bad. "I spent nine years and three months in prison," he said. "It was really rough. Physically and emotionally very tough," he said. "However that pales in comparison to all the suffering of the thousands of victims who had placed their trust in me."

In Sasak's Arizona scheme in the 1980s, he would organize investors to lend money to high-risk borrowers who put up property as collateral. Often the borrowers defaulted and Sasak and his partners would now possess valuable commercial real estate. With rising real estate prices, they were raking in the cash. Securities salesmen now wanted to sell his limited partnerships as investments. Under the name Avanti Mortgage, Sasak began more partnerships than most broker dealers in the U.S.

But then he found himself on a treadmill; he had to come up with product quickly. The pressure pushed him to engage in many questionable practices including parking securities. "The money's coming in so fast that we fully sell out one partnership," Sasak said. "And we've got checks already in before we've got the other partnership to the regulators," he said. "Then when we'd get that one ready to go, we'd just dump those checks into the next one."

Cliff Robertson Paid the Cost for Taking a Stand
One simple action in 1977, changed actor Cliff Robertson's life. In February of that year Robertson received an IRS 1099 form reporting $10,000 in earnings from Columbia Pictures. Knowing he had not received money from the company, Robertson turned the matter over to the authorities.

The Los Angeles police and the FBI found that Columbia Pictures president David Begelman forged a $10,000 check made out to Robertson. Columbia placed Begelman on paid leave and launched its own internal investigation. They found that Begelman's forgery was one of several "unauthorized financial transactions" on his part.

In December of 1977, Begelman was reinstated as Columbia's president, claiming that his embezzlement was prompted by "emotional problems" that "coupled with ongoing therapy, would not impair his continuing effectiveness as an executive."

Columbia Pictures put pressure on Robertson to remain silent. Speaking out against the Hollywood hierarchy is never the best career advancement strategy. But now, with Begelman's reinstatement, Robertson was frustrated and angry. "Cliff felt like a fool," according to the 1982 book, "Indecent Exposure," written by David McClintick in the wake of the scandal. "He had exposed a criminal. He had put the criminal's employer on notice, as well as four law enforcement agencies. Nothing had been done. No, that wasn't quite correct. Something had been done. The criminal's company had placed him on 'leave of absence,' and 'investigated.' Not only had the inquiry confirmed Cliff's original allegation. It had found other embezzlements as well. ... Begelman and the rest of the Columbia people must really be chortling at me, Cliff thought. He was enraged. Should he just drop the whole thing? Did he have any other recourse? ... In complete agreement with all of his thoughts and feelings, (his wife) Dina (Merrill) picked up the telephone and called longtime friend Katherine Graham, the chairman of the board and published of The Washington Post. 'Cliff has a story to tell your newspaper, Kay.' "1

He told the Post, "There is a spreading cancer of corruption in Hollywood, of which the Begelman incident is but one example." He told the Associated Press, "Wealth and power create a kind of atmosphere of fear. I think they begin to believe that they are above the law."

By early 1978, Hollywood gossip columnists Rona Barrett and Liz Smith exposed the story to a mass audience, with Smith coining the affair "Hollywoodgate." Producer Ray Stark called Robertson and told him that if he continued talking to the press Begelman would be driven to suicide. Robertson said that he would do "what a citizen should do in this situation."

Begelman received legal and industry slaps on the wrist for his embezzlements. Shortly after Hollywoodgate he was back in the executive suite, running United Artists for MGM. Robertson was blacklisted for four years after reporting David Begelman's forgery. Begelman eventually did commit suicide in 1995 after being implicated in other frauds.

ACFE Presents Outstanding Achievement Awards to Members and Chapters
The Association, in its effort to promote excellence in fraud examination in the private and public sectors, presented the second set of Outstanding Achievement Awards to members and chapters at the 14th Annual Fraud Conference & Exhibition.

Chapter of the Year
Toronto Chapter
The Chapter of the Year Award is presented to a chapter that is active and is in good standing with the Association and provides timely and high-quality fraud training and networking opportunities for its members and outreach programs for the local business community about fraud prevention and detection, and actively promotes fraud examination in its community.

The Toronto Chapter, one of the largest ACFE chapters in the world, is also one of the most active. It offers members access to a large library of fraud and legal books, holds an annual one-day conference, has partnered with professional groups to provide networking opportunities and training sessions, provides speakers for various groups, and gives advice to local colleges that teach fraud detection and prevention and job search assistance to new immigrants with fraud-fighting backgrounds. The chapter has also provided invaluable assistance to the ACFE at its annual Canadian fraud conferences. Chapter members have staffed the reception desk and identify speakers and topics. Steven Silverberg accepted the award for the Toronto Chapter.

Certified Fraud Examiner of the Year
Robert DiPasquale, CFE, CPA
The Certified Fraud Examiner of the Year Award is presented to a Certified Fraud Examiner who has demonstrated outstanding achievement in the field of fraud examination. As a CFE in good standing, this person must have played a significant role in the prevention, detection, or investigation of fraud or made a substantial recovery or savings due his or her role or made a significant contribution to the discipline of fraud examination.

Robert DiPasquale, CFE, CPA, is the director of the litigation services department for the New Jersey office of the Videre Group. He is a past chairman of the Board of Regents for the ACFE and served three terms as the president of ACFE's New Jersey Chapter. He was awarded the chapter's life achievement award for his outstanding and dedicated service. He also previously served on the ACFE's research committee and the Board of Review which recommends disciplinary action against fellow CFEs. In addition to his investigatory work which covers a wide variety of fraud examinations, he spends hundreds of hours annually educating professionals in the financial and legal communities, the media, and business owners on white-collar crime. He also finds time to author many articles for The White Paper, as well as for other notable periodicals.

Associate Member of the Year
Jon McDowall
The Associate Member of the Year Award is presented to an Associate member who has demonstrated outstanding achievement in the field of fraud examination. As an associate member in good standing, this person must have played a significant role in the prevention, detection, or investigation of fraud or made a substantial recovery or savings due his or her role or made a significant contribution to the discipline of fraud examination.

Jon McDowall has been a licensed private investigator for more than 16 years and the director of the Consulting and Investigations Group for Per Mar Security. He serves as the chair of personnel for the board of directors of Christian Friendliness and is a volunteer youth leader for a local Awana children's program. He has given many educational ID theft risk mitigation presentations for civic, not-for-profit, and private groups as well as for businesses. He has authored several articles for publication. In addition to the numerous ID theft-related investigations he works, he makes time every month to assist victims of identity theft in the recovery process on a pro-bono basis. He also educates individuals and businesses regarding the risks and potential liabilities of identity theft. He has provided expert witness testimony on ID theft and consulted with U.S. Congressional crime and finance sub-committee members regarding privacy legislation.

Hubbard Award
Craig L. Greene, CFE, CPA
The Hubbard Award is a new award this year for the ACFE. It is named after ACFE Regent Emeritus and professor of accountancy at the University of Nebraska, Dr. Thomas Hubbard, CFE. Hubbard has been a long-time and active member of the Association and helped the ACFE through its formative years. He was also an early pioneer of promoting the discipline of fraud examination in the world of academia.

This award is given to the author of an article published in The White Paper article during the past year. Unlike other awards that are determined by a committee, this award is decided by our members. Craig Greene, CFE, CPA, won the award for his article, "When Employees Count Too Much: Spotting Overstated Inventory" in the Nov./Dec. 2002 edition of The White Paper. Greene, a frequent ACFE instructor, is the partner in charge of financial investigation services for McGovern & Greene LLP, a forensic accounting and litigation services consulting firm based in Chicago, Ill.

Newsletter of the Year
Vancouver Chapter
The Newsletter of the Year Award is awarded to the chapter newsletter that is of highest quality, delivered to recipients on a regular and timely basis, and contains pertinent chapter information and a schedule of upcoming chapter training events. The Newsletter of the Year must also provide information received from ACFE headquarters and other relevant and timely anti-fraud information, articles of interest, or other information that would benefit the membership or community.

The Vancouver Chapter's newsletters, under the leadership of Leslie Davidge, are timely, informative, interesting, and professionally done. Davidge is an ethics investigator with CGA British Columbia.

Outstanding Achievement in Anti-Fraud Education W. Steve Albrecht, CFE, CPA, CIA
The Outstanding Achievement in Anti-Fraud Education Award is presented to a qualified Association member who has made an outstanding contribution in promoting education related to fraud prevention, detection, and investigation. Factors considered in selecting the recipient are anti-fraud curriculum development efforts, design or production of anti-fraud education materials, number of students or participants taught in anti-fraud education efforts, pedagogies developed to teach anti-fraud methodologies, and influence in encouraging anti-fraud education.

W. Steve Albrecht, CFE, CPA, CIA, is an associate dean of the Marriott School of Management and Andersen Alumni Professor at Brigham Young University. He was the first president of the ACFE and is a Regent Emeritus. Albrecht has done extensive research on white-collar crime and business fraud resulting in the publication of more than 80 articles in professional journals. He is the author or co-author of 18 books or monographs, three of which are on white-collar crime and fraud. Albrecht has won many awards including the BYU School of Management's Outstanding Faculty Award, the Maeser Outstanding Research Award, and the Maeser Distinguished Lecturer Award. Perhaps his most distinguished award for his efforts in fraud examination is the ACFE's own Cressey Award.

Outstanding Achievement in Commerce
Richard Lanza, CPA
The Outstanding Achievement in Commerce Award is awarded to a member who has made an outstanding contribution in commerce. As a member in good standing, this person must have been in charge of or participated in a significant investigation that resulted in a white-collar crime conviction in business or commerce, developed or implemented a system of internal controls intended to prevent or deter fraud in business or commerce, was instrumental in having new or revised fraud and/or white-collar crime procedures implemented in any area of business or commerce, or was instrumental in a large monetary recovery from the successful litigation of fraud or white-collar crime.

Richard Lanza, CPA, is an Associate member of the ACFE and a manager of internal audit at a Fortune 200 retailer where he focuses on using computer-assisted audit tools to improve business intelligence, increase efficiencies, and identify bottom-line savings. Lanza prepared a research paper through the Institute of Internal Auditors on "Proactively Detecting Occupational Fraud Using Computer Audit Reports," which helps auditors worldwide to fight fraud using computers. He has made this paper available to everyone free of charge. The document will assist auditors, fraud examiners, and management in implementing data analysis routines for improved fraud prevention and detection. It also provides a comprehensive checklist of data analysis reports that are associated with each type of fraud scheme and provides general guidance to help an audit team get started analyzing company data. Lanza is the founder of a non-profit Web site devoted to increasing the use of software in audit and investigative engagements. He also writes the new column "Fear Not the Software" in The White Paper.

Outstanding Achievement in Government
John Fisher Weber, CFE, CPP
The Outstanding Achievement in Government Award is presented to an Association member who is an employee of a local, state, or federal government entity and has demonstrated outstanding achievement in the field of fraud examination. As a member in good standing, this person must have played a significant role in the prevention, detection, or investigation of fraud, made a substantial recovery or savings due to his or her role or made a significant contribution to the discipline of fraud examination or was instrumental in having new or revised fraud and/or white-collar crime legislation enacted at any level of government.

John Fisher Weber, CFE, CPP, is the manager of the Special Investigation Unit of the Texas State Auditor's Office. He is also a Regent Emeritus of the ACFE and helps teach the Association's graduate fraud examination course at the University of Texas at Austin. He has worked with the senior staff of his agency to encourage the Texas legislature to take fraud prevention seriously and make fraud prevention training mandatory in all state agencies. After receiving a copy of the CD, "How Fraud Hurts You and Your Organization," which was developed by the ACFE and AICPA, he approached the ACFE about the possibility of doing a similar program for government employees. He is currently in the process of developing material for this new training program and is working to set up interviews of convicted government fraudsters. This program will be distributed free to all government agencies who request it.

Outstanding Achievement in Law Enforcement
Tyler A. Smith, CFE
The Outstanding Achievement in Law Enforcement Award is presented to a qualified Association member who is an employee of a local, state, or federal government entity with law enforcement responsibilities and has contributed significantly to the detection, deterrence, or the investigation and prosecution of fraud or white-collar crime cases.

Tyler A. Smith, CFE, is a special agent for the U.S. Department of Energy Inspector General in the Office of Attorney General. Whenever there is a complicated or sensitive fraud investigation, Smith uses his "pit-bullish" persistence to bring it to a successful resolution. His recent investigation of a national laboratory employee brought a rare guilty plea to federal bribery charges. He also volunteered to serve as a federal air marshall augmentee immediately after the September 11 terrorist attacks while simultaneously providing leadership in the U.S. Army Reserve Military Police Corps.

Outstanding Achievement in Outreach/Community Service
Robert McCloud, CFE
The ACFE believes strongly that members should be active members of their communities and committed to helping improve the quality of life where they live and work. We fulfill this commitment through volunteerism and community partnering. The recipient must demonstrate that he or she has been an active volunteer in community projects that have resulted in a recognized improvement of a community. This can be demonstrated by the commitment of time or donations to a charitable cause.

Robert McCloud, CFE, is a legislator auditor for the state of Tennessee. But when he is not busy with his job or ACFE chapter activities, he works to make his community a better place. McCloud helps guide youth through his church and the Boy Scouts and is an advocate for parents of troubled children, and a Junior Achievement volunteer. He recently helped build a community playground for children.

Outstanding International Member
Alfredo Ruben Popritkin, CFE, CPA
The award for the outstanding international member is given to a Certified Fraud Examiner or Associate member who has demonstrated outstanding achievement in the field of fraud examination. As a member in good standing, this person must have played a significant role in the prevention, detection, or investigation of fraud or made a substantial recovery or savings due his or her role or made a significant contribution to the discipline of fraud examination.

Alfredo Ruben Popritkin, CFE, CPA, works at the Corte Cuprema de Justicia de la Nacion for the Republica Argentina. He has acted as a forensic expert and fraud examiner in more than 1,700 crimes cases including money laundering, financial statement fraud, bank crimes, swindles and falsifications. He is a member of the ACFE's Argentina chapter and a professor for fraud examination courses in the Universidad de Buenos Aires. He has also lectured on fraud topics in Argentina as well as participated in many congresses on organized crime and money laundering.