Background
Who was the CEO during the time of the fraud?
Dean Buntrock
Who replaced Buntrock as CEO of waste management and continued the fraud?
Rooney
What was the ultimate goal of the fraud?
To boost profits so that they could meet their sales targets, retain their jobs, and continue to earn generous bonuses
Why didn’t subordinates report management?
Risk of Retaliation
What is the most successful tool to catch fraud?
Whistleblower Hotlines
How was the fraud uncovered?
New CEO ordered internal review and found overstatement of profits
Who were the three top executives that drove the entire fraud and sold their company shares as the fraud was ongoing?
Buntrock, Rooney, Koenig
One of the fraudulent activities the company participated in was by improperly [blank] expenses
Capitalizing
What made this fraud especially difficult to catch?
The scale of collusion
Who now offers cash awards and certain non retaliation protections to whistleblowers?
The SEC
In which years did Waste Management commit the fraud?
1992 - 1997
Briefly explain how the fraud worked and who did what, not including the two men that were CEO.
Koenig ordered the destruction of damaging evidence, misled the Company's audit committee and internal accountants, and withheld information from the outside auditors
Hau was the "accounting whiz" cooked the books for Koenig. He devised many "one-off" accounting manipulations to deliver the targeted earnings and carefully crafted the deceptive disclosures.
Tobecksen joined the fraud 1994 to handle Hau's overflow because it was getting to be such a large process.
Getz blessed the Company's fraudulent disclosures.
How did the company manipulate depreciation expense?
Increased useful life and salvage values of assets
What did Waste Management do to sort of trick Andersen into performing “special work”?
Capped billable hours/the audit budget
What are some desirable traits of the Audit Committee Chairman?
Inquisitive
Frequent communication with the auditor