Fraud Friday — CPA Pleads Guilty for Issuing Fake Audited Financial Statements

November 20, 2015

By Bob Coleman
Editor, Fraud Friday

courtroom2CPA Marc Wieselthier issued audited financial statements for a Florida-based cosmetics firm that was relied upon by two banks for an asset-based credit line.

The banks, and U.S. Attorney Preet Bharara, were shocked to learn Marc fraudulently inflated sales and accounts receivable.

Borrowing base certifications were also fraudulently inflated.

The company defaulted on the line last year with an outstanding balance of almost $5 million.

“As a part of the scheme, on an annual basis, Wieselthier knowingly issued unqualified audit reports known as ‘clean opinions’ falsely certifying that the Company’s financial statements fairly, and in all material respects, reflected the true financial condition of the Company and were in conformity with generally accepted accounting principles,” says the U.S. Attorney.

“At the time that Wieselthier issued those ‘clean opinions,’ Wieselthier knew that the Company’s financial statements falsely overstated the Company’s accounts receivable and understood that the Banks would rely upon those false financial statements in loaning money to the Company.

“Wieselthier hid his accounting work for the Company from his own partners and associates in an apparent effort to conceal the fraud.”

Emanuel Cohen, 71, of Boca Raton, Florida, the company’s former chief executive; and Thomas Thompson, 42, of Coral Springs, Florida, the company’s former sales manager have previously pled guilty to bank fraud.

Marc faces the obligatory 30 years in federal prison.