Unethical Behaviors Involved
Madoff accountant Paul Konigsberg was charged for helping Benerd Madoff, a convicted swindler to deceive thousands of customers in the Ponzi scheme. Konigsberg role included defrauding customers by falsifying records and participating in conspiracy. Thus, he failed in his duties as accountants and favored backdating clients accounts statements. He did this to curb losses of millions of dollars, factious trades and conjured profits. Konigsberg is the 15th person to be charged with the Bernard L. Madoff Investment Securities LLC. fraud. Together with Frank DiPascali, Konigsberg assisted Madoff to manipulate trades and backdating of documents. This aided Bernard L. Madoff Investment Securities LLC. to deceive customers by making them appear to be getting steady investment returns which was not the case. Konigsberg is also alleged to have conspired with Madoff to arrange for a job for his relative. In this arrangement, the supposed relative earned more than 320 000 dollars without showing for work between 1992 and 2008. Konigsberg also used his non-voting shares in a London based operation to help Madoff launder money from the operation.
The Injured Parties
The injured parties in the Bernard L. Madoff Investment Securities LLC. fraud were mostly the deceived investors. They were cheated that they will get steady returns on investments which was not the case. For instance, in 2008, Madoff recouped 1.6 million dollars from a customer by backdating losing trades. In addition, Bernard L. Madoff Investment Securities LLC also lost money due to the employees’ conspiracy. Indeed, the conspiracy between Madoff, the firm’s founder and the accountant, Konigbergs to employ the latter’s relative between 1992 and 2008, resulted in a loss of 320 000 dollars. The fraud also tarnished the public image of the Bernard L. Madoff Investment Securities LLC. firm. Besides, Konigsberg conspiracy with Madoff led to money launder in a London based operation. Ultimately, the public image of the Konigsberg Wolf and Co where Paul Konigsberg was a senior tax partner and accountant was also tarnished.
Impacts on the Organization, Individual and the Society
Solution
Solving unethical behavior of fraud through falsifying documents and conspiracy calls for high level of professionalism. Individuals must practice high degree of accountability and integrity which can only happen when they value professionalism. In addition, firms should continually carry out financial and operation audits. The audits can help to detect frauds early on. Additionally, the firms should undertake both external and internal audits so as to ensure consistency in the audit reports. The accountants should also be provided with opportunities for on job training to stop the fraud.
Reference
Stempel, J., and Vaughan, B. (2013). Madoff Accountant Charged with Aiding Pnzi Scheme. New York Times. Retrieved on 09/10/2013 from http://www.nytimes.com/reuters/2013/09/26/business/26reuters-madoff-konigsberg.html?ref=rajrajaratnam&_r=0
