The Fraud Examiner

Message from the President

Pacific Northwest Chapter of the ACFE

Congratulations to the ACFE Foundation for a second successful year managing the Silent Auction held in conjunction with the ACFE’s 20th Annual Fraud Conference and Exhibition in Las Vegas, NV. The 2009 event raised $20,666 ($9,500 in cash do-nations, and $11,166 in auction revenue). This money funds the annual Ritchie-Jennings Memorial Scholarship Program which awards 30 scholarships (U.S. and In-ternational categories) of $1,000 each to deserving students planning to pursue a future in the fraud examination career field. And, congratulations to the three students who won ACFE scholarship awards this year and to the two students who won Chapter scholarship awards this year (see page 9 of the newsletter for additional details. One of these students sent an e-mail and letter to the Chapter to thank us for the scholarship award (see page 8 of the newsletter for additional details). This was a nice touch. All of these students repre-sent their colleges and universities and our profession very well. The Chapter Board of Officers is very proud of them. Congratulations once again to all! Our biggest anti-fraud training events of the year will be occurring in the near future. The first event is a two-day fraud class the Chapter jointly sponsors with the ACFE on October 26-27, 2009, at the DoubleTree Inn Hotel in SeaTac. The second event is a one-day fraud conference the Chapter jointly sponsors with the WSCPA on De-cember 7, 2009, at the Meydenbauer Center in downtown Bellevue (see page 2 of the newsletter for additional details). Your support of these anti-fraud training events helps to financially benefit our Chapter and allows us the opportunity to pro-vide services to the membership as we currently do. See you there! Over the past year, a number of Chapter members have approached me about par-ticipating in positions of leadership on our committees and boards. Right now, seven members serve in these leadership positions with our Board of Officers performing three functions—the overall Chapter direction, the educational committee, and the scholarship committee. But, that will most likely change with the upcoming June 2010 Chapter elections as we seek to get more members involved in this important work. I know that it may seem like the date is far away in the distance. However, you would be surprised how quickly our elections will be upon us. Please take some time to think about your availability for a position of leadership in the Chapter, and then contact me to discuss it further. Thanks. Joe Dervaes President

September/October 2009 Issue Inside this issue:

PNW Chapter Training

2

Chapter Members in the News

3

Electronic Discovery

3

Spokane Chapter / ACFE Fraud Conference

3

The Tidbit 4

John Reid and As-sociates Article

5

Pictures from 2009 ACFE Fraud Con-ference

6-7

ACFE Challenge 8

Scholarship Winner Letter

8

Report from Chap-ter Representatives

8

ACFE and Chapter Scholarship Award Winners

9

Other Training 12

Chapter Board of Officers

12

International Fraud Awareness Week

10

News From the Trenches

11

Calgary Chapter / ACFE Fraud Conference

10

Page 2 The Fraud Examiner

October 26-27, 2009 (Monday-Tuesday) are the dates of the next Fraud Class our Chapter jointly sponsors with the ACFE. The topic is “Financial Statement Fraud”. The ACFE speaker is Robin Taylor, The location of this fraud class will be the SeaTac DoubleTree Inn Hotel across the street from SeaTac International Airport. This two-day fraud class in-cludes the following segments:

(1) Introduction to Financial Statement Fraud; (2) Manage-ment’s and auditor’s responsi-bilities; (3) Improper revenue recognition, treatment of sales, asset valuation, deferral of costs and expenses, and re-cording of liabilities; (4) A video presentation about real world financial statement schemes; (5) Inadequate disclosures; and, (6) Detecting financial statement fraud. The ACFE will provide all re-

freshments and a continental breakfast on both days of the class. It will also provide lunch for all attendees on day one only. The Chapter will provide lunch for Chapter members only on day two of this class. Contact the ACFE directly at www.ACFE..com to register for this Class. The Chapter Board of Officers will perform registration duties at the hotel.

each for a total of 8 hours of CPE). And, registration begins at 7:30 a.m. Session #1: Julie Bollerud, Hagen, Streiff, Newton, & Oshiro, Accountants, PC; and Brett Shavers, Computer Tech-nology Investigators Network.. Topic: “Digital Forensics—Another Tool in Your Investi-gative Toolbox”. Session #2: Jan So, Washing-ton State Department of Finan-cial Institutions. Topic: “The Barry Hammer Ponzi Scheme—A Case Study”. Session #3—Linda Saunders,

December 7, 2009 (Monday) is the date of the next Annual Fraud Conference our Chapter jointly sponsors with the WSCPA. The location of this Confer-ence is new again this year. The Conference will be held at the Meydenbauer Center in downtown Bellevue. The Con-ference registration fee for WSCPA and Chapter Members is $220, and $295 for Non-Members. There is also a park-ing garage available for a fee. The Conference has four ses-sions of approximately 2 hours

Forensic Accounting Consult-ing; and Tiffany Couch, Acuity Group PLLC. Topic: “Cooking the Books with Quickbooks”. Session #4: Detective David Dunn, Seattle Police Depart-ment and U.S. Secret Service Electronic Crimes Task Force. Topic: “Current Trends in Electronic Crimes”. Contact the WSCPA directly at www.wscpa.org to register for this Conference. The Chapter arranged for all of the speakers, and the WSCPA will handle all of the administrative duties at the Conference.

October 26-27, 2009 Joint ACFE/Chapter Fraud Class

Overview of December 7, 2009 Annual Fraud Conference

Highlights of August 2009 Bi-Monthly Fraud Seminar

risks in real property transac-tions. The speakers covered subjects such as foreclosure rescue scams, leasebacks, loan workout/or forbearance scams, predatory lending, and estate planning issues. A video on an actual foreclosure scam in pro-gress was most interesting.

These topics were definitely of great interest to the attendees. Attendees learned more about the latest developments related to these topics and how they will invariably affect us all in our daily lives and/or in our anti-fraud practices.

The speakers were Jim Sugarman and Jake Bernstein, Assistant Attorney Generals in the Consumer Protection Divi-sion of the Washington State Attorney General’s Office in Seattle, WA. The seminar dealt with fraud

Upcoming Training Type: Annual Fraud Class Jointly Sponsored by ACFE and the Chapter. Date: October 26-27, 2009 (Monday-Tuesday). Time: 8:00 a.m.– 4:30 p.m. Topic: Financial Statement Fraud. Speaker: Robin Taylor Where: DoubleTree Inn Hotel, SeaTac. Price: The seminar fee is $695 for Chapter members and $845 for non-members. There is an early registration discount of $95.

Page 3 September/October 2009 Issue

New Chapter Members Please welcome new members during the period August-September 2009: CFE’s Lynn Sharp Associates Alan Rosenthal Dennis

Thompson Students <None>

New CFE’s <None> We have several Chapter members who are currently studying for the CFE Examination. So, we expect to see their names listed in this section of the newsletter in the near future. Let’s all wish them success in this most important professional matter.

Electronic Discovery Certificate Program

might be a good course to take. It will deal with both the technology and the legal aspects of managing digital evidence. Class information can be obtained at: “http://www.extension.washington.edu/ext/certificates/edm/

edm_gen.asp”. The class will meet in downtown Seattle at Puget Sound Plaza, 4th Ave-nue and Union (1325 Fourth Avenue).

The University of Washington Law School has announced a new certificate program start-ing in Fall 2009 on “Electronic Discovery Management”. For those fraud examiners that want/need to manage large scale computer discovery, this

Chapter Members in the News

of Forensic and Investigative Accounting”. He already serves on the Editorial Boards of the “Journal of Forensic Accounting” and “Fraud Magazine”. In addition to reviewing the work of other authors, he also writes a column in “Fraud Magazine”

called “Taking Back the ID”. Congratulations on these achievements in our Commu-nity Outreach Program.

Chapter Member Dr. Robert Holtfreter, CFE and Distin-guished Professor of Ac-counting and Research at Central Washington Univer-sity (Ellensburg Campus), was recently selected to serve on the Editorial Board of a new fraud journal called “Journal

IRS. (2) Obtaining a Confession

101: Craig Brenden, Spokane Police Depart-ment.

(3) Bankruptcy Fraud; Celeste Miller, U.S. At-torney’s Office.

(4) Fraud and the Auditor: Pat McDowell, Vice-President, Vancouver B.C. Chapter/ACFE.

(5) When to Suspect Who You Would Never Sus-pect: Mark Mays, Attor-ney and Professor at Gonzaga University.

(6) Detecting and Preventing Fraud in a Troubled Economy: Peter Miller, Director of Technology, ACL.

The Spokane Chapter hosts its annual Fraud Conference on November 19-20, 2009, at Spokane Community College (Lair Building), 1810 North Green Street, Spokane. The Conference registration is $295 for both days and $200 for one day. Contact the Spo-kane Chapter directly to ob-tain a copy of the Conference flyer, to register for this event, and/or to obtain additional information (www.spokanefraud.org). Topics and speakers are: (1) Investigating Fraud in Our

Backyard: Lisa Jangaard, FBI; and, Michael Payne,

(7) Mortgage Fraud, iden-tity Theft, and Organ-ized Crime: Colin Parcher, President Vancouver B.C. Chap-ter/ACFE.

(8) Claims Fraud in the Healthcare Industry: Katherine Jones, Presi-dent, Boise Chapter/ACFE.

(9) Forensic Document Analysis: Brett Bishop, WSP Crime Labora-tory (Seattle).

Annual Fraud Conference—Spokane Chapter/ACFE

Page 4 The Fraud Examiner

not to mention my good name. For what it’s worth...I have no intention of losing.” Don’t fall victim to the scammers.! (2) Name Change Fraud Against Banks Gets Man Seven Years. The following information was paraphrased from the February 14, 2009, issue of The news Tribune (Tacoma): A Tacoma man who frequently changed his name so he could commit bank fraud over and over again was sentenced to seven years in federal prison the U.S. Attorney’s Office re-ported. The 54-year old individual pre-viously pleaded guilty in U.S. District Court in Tacoma. Federal prosecutors contend the man would open an ac-count at a local bank, deposit bad checks to pump up the balance, and then withdraw cash or write checks on the accounts before the banks caught on. He’d then legally change his name so he could do it again according to prosecutors. The man opened more than 40 accounts over the past decade and netted more than $212,000 in cash and merchandise from more than 100 merchants ac-cording to prosecutors. The man, who previously spent time in prison for forgery, was arrested in the bank fraud scheme last year. (3) Check Fraud Losses on the Rise According to latest research, check fraud losses are increasing, even though slightly fewer organizations

(1) Mortgage Foreclosure Scam. The following information was paraphrased from the May 8, 2009, issue of The News Trib-une (Tacoma). A Tacoma man must pay more than $3.2 million to victims of a foreclosure scam, the state Attorney General’s Office an-nounced. The individual ran a “notorious” foreclosure rescue scam, entering into transactions with more than 300 homeown-ers. He would talk to home-owners facing foreclosure and offer to have his business take over ownership of the prop-erty. None of these property owners has ever successfully regained their homes from the man. He also wrote several books that describe tactics for making money from real estate deals involving distressed properties. The individual is a cunning real estate investor who made his living by claiming to help people facing tax foreclosure—then taking their homes, land and money. A trial in King County Superior Count ended in January. The judge ruled that the man and his businesses are banned from participating in any transactions involving foreclosure. This individual is the first fore-closure “rescuer” to be tried by the state Attorney General’s Consumer Protection Division. The man has posted on a per-sonal web-site that he has not done anything illegal. He said: “I’m battling the (Attorney General) for my very existence,

are being targeted by check fraudsters. The good news: Due to the growing use of anti-fraud services such as Positive Pay, only 37% of organizations that were targets of payments fraud (including check, ACH, credit/debit card and wire transfer fraud) actually lost money to these crimes. This was unchanged from 2007. Details: Nearly all organiza-tions are targets of payments fraud—91% in 2008, compared with 94% the year before. Of these, 71% were targets of check fraud in 2008, which was unchanged from the year before. In addition, of the companies that were targeted by check fraudsters, 47% suffered losses due to the fraud attempts. The bad news—which all or-ganizations must respond to with tougher anti-fraud meas-ures—is the increasing amount of loss per successful payments fraud attempt. Details: Losses due to all major forms of payment fraud (of which check fraud losses make up 60%) were up by 9% in $15,200 in 2008 from a five-year low of $13,900 in 2007 which repre-sented a 50% decline from $26,600 in 2004. Source: White-Collar Crime Fighter, Volume 11 No. 6,June 2009

The Tidbit—Three Items for Your Reading Pleasure

According to latest research, check fraud losses are increasing, even though slightly fewer organizations are being targeted by check fraudsters. Losses due to all major forms of payment fraud (of which check fraud losses make up 60%) were up by 9% in $15,200 in 2008 from a five-year low of $13,900 in 2007 which represented a 50% decline from $26,600 in 2004.

Page 5 September/October 2009 Issue

John Reid and Associates — Investigator Web Tip (July/August 2009)

be tried as an adult and face life in prison, he recanted his confession and explained that it was his father who actually shot the guest. A polygraph confirmed the boy’s statement, the father was interrogated and con-fessed. We have also experienced the opposite situation, where a parent has confessed to protect a son or daughter who was involved in criminal activity. Low Intelligence / Youthful Offenders. In the previous New Year’s eve killing, the boy’s father told him that because he was a teenager he would not go to prison. It has been suggested that suspects who are young or have a low IQ may fail to understand the severity of consequences they face through their decision to confess…. Coercion. Many innocent people will confess to a crime if they are subjected to sufficient pain or threats of harm (coercion)…. For a confession to be admissible as evidence, it must be ob-tained without inflicting or threatening to inflict any physical harm to the sus-pect. While coercion specifically re-lates to the suspect’s physical well being, there is a related psychological circumstance which may have an even greater impact on false confessions…. Duress. The average innocent suspect can answer questions and fend off persuasive interrogation techniques for many hours without being tempted, in any way, to confess. However, when the sessions become too lengthy, in-tense or unbearable, the innocent suspect may confess to terminate the conditions. Duress describes lengthy questioning, as well as deprivation of biological needs such as sleep, warmth or food…. When evaluating the trust-worthiness of a confession, it is impor-tant to recognize that some suspects are more susceptible to persuasive interrogation techniques. Mental Illness. Following a heinous crime, it is not uncommon for inno-cent individuals suffering from mental

illness to come forward and con-fess. Some of them are delusional and receive “messages” to confess. Others have lost touch with reality and believe they committed the crime. Some con-fess to seek attention or recognition….. Faulty Memory. Finally, an innocent person may be persuaded to confess if he has no recollection of his activities at the time of the crime but is convinced, after learning of evidence of his guilt, that he must have committed the crime. This is termed a coerced inter-nalized false confession…. Conclusion. Just because there are many possible motivations for innocent people to confess does not mean that most confessions are false. To the contrary, the average criminal suspect is more than capable of resisting standard interrogation tactics and a great deal of effort is required to persuade these individuals to tell the truth. But experi-ence and scientific evidence proves that innocent suspects have con-fessed. Furthermore, each of these false confessions satisfied a particular motivation. Awareness of these moti-vations should assist investigators in selecting appropriate interrogation techniques for particular suspects and should also assist prosecutors and judges to identify confessions that may not be true…. This article was prepared by John Reid and Associates, Inc. For additional information, contact them at: www.reid.com or 1-800-255-5747.

To obtain a full copy of this article, contact President Joe Dervaes at: joeandpeggydervaes@centurytel.net or at (253) 884-9303.

Motives for False Confessions To date, the innocence project has freed in excess of 200 individuals from prison based on DNA evidence. These innocent defendants were found guilty of serious felonies such as murder and rape. Fur-thermore, about twenty percent of them confessed to committing the crime either to the police during an interrogation, or to a judge as a result of a plea bargain with the prosecutor. What causes inno-cent people to confess to crimes they did not commit? The simple answer is that, at the time of the confession, many of these suspects believed that it was in their best interest to confess, e.g., escape a death sentence, keep children out of a foster home, etc. However, when evaluating individual cases, a number of specific mo-tivations can be identified. When evaluat-ing the trustworthiness of a confession, the investigator, prosecutor and judge should consider the following motivations for false confessions. This John Reid and Associates article is too long to print in its entirety in our Chapter newsletter. However, it is sum-marized as follows. Tangible Gains. ….Examples of tangible gains that may lead to a false confession include seeking shelter, food, medical care, and protection (being hunted by drug lords). These suspects may come forward and confess without any interro-gation (the so-called voluntary false con-fession), or confess after a relatively short and mild interrogation. Once their need has been satisfied, they recant the confes-sion but find that it is much easier to be charged with a crime than having the charges dropped. Protecting a Loved One. During a new year’s eve party, a guest was shot in the host’s back yard. When the police ar-rived, the host’s teenage son came for-ward and explained that the guest was arguing with his father so the boy ran into the house, retrieved a shotgun and killed the guest. The boy was charged with first degree murder and obtained an attor-ney. Once the boy learned that he would

Page 6 The Fraud Examiner

Welcoming Reception—Sunday Evening

Pictured are:

(1) New ACFE 20 Year Member Pin.

(2) Tag attached to Cham-pagne Glass for ACFE’s 20th Anniversary Toast.

(3) New ACFE Challenge Pin (see accompanying article on page 8).

Additional

20th Annual

Fraud

Conference

and Exhibition

pictures from

Las Vegas, NV

may be found

at: http://

www.fraudcon

ference.com.

Pictured are (left to right): Vicki Murphy, ACFE Foundation Scholarship Committee Mem-ber, Montana Chapter. A.T. “Chief” Schwyzer, ACFE Professional Standards Commit-tee, Arizona Chapter. Dr. Norm Gierlasinski, ACFE Foundation Scholarship Com-mittee Member, Pacific North-west Chapter. Sheila Bowman, New Mexico Chapter (back to camera).

Pictured are (left to right): Lisa Handy, Gary Pelcak, Mike Han-sen, Chief Schwyzer, Chrissie Powers, Stacy Shiflet, Kathy Rupert, Peter Tobin (Pacific Northwest Chap-ter), Sherry Hull, Sheila Bowman, and Vickie Murphy.

Page 7 September/October 2009 Issue

Pictured are (left to right): Award Recipient: Colin Parcher, President, Vancouver B.C., Canada Chapter/ACFE. Award Presenter: Bruce Dorris, Program Director, ACFE .

2009 ACFE Award—Chapter Newsletter of the Year

Award Recipient Pictured: Joe Dervaes, ACFE Foundation Board of Directors, and Presi-dent, Pacific Northwest Chapter/ACFE.. Other Award Recipients were: (1) Jim Ratley, President, ACFE. (2) Nancy Bradford, Chair, ACFE Foundation Board of Direc-tors. And, (3) A.T. “Chief” Schwyzer, Arizona Chapter/ACFE.

2009 ACFE Superior Service Award— Attended 20 Fraud Conferences

Pictured are (left to right): Award Recipient: Stacey Carr, Member, Spokane Chapter/ACFE.. Award Presenter: Peter Callaway, Chair, ACFE. Board of Regents.

2009 ACFE Award—Outstanding Achievement for Outreach/Community Service

2009 ACFE Awards

Page 8 The Fraud Examiner

ACFE—The Association That Generated A Movement

could not produce a coin—the most popular required the coinless soldier to buy a round of drinks. That prac-tice continues to be popular today. The ACFE Challenge Coin (pictured in Conference photographs on page 6) represents the commitment and sacrifice of fraud examiners world-wide who are dedicated to the fight against fraud. The fraud examiner must be persistent, thorough, inquisi-tive, detail-oriented, and ethical be-

yond reproach. This Challenge Coin serves as a reminder of the signifi-cance of your efforts and the impor-tance of your role as an anti-fraud professional. President Joe Dervaes displayed the new ACFE Challenge Coin to all those attending the Chapter’s August 26, 2009, fraud seminar in our downtown

Seattle location.

All attendees at the ACFE’s 20th Annual Fraud Conference and Exhibition in Las Vegas, NV received the new ACFE Chal-lenge Coin. Challenge Coins surfaced during the World War II era. The practice of carry-ing a coin designed specifically for a unit was popular with the Army Special Forces. Carrying the coin at all times and presenting it when “challenged” to prove affiliation with that unit resulted in a number of consequences for those who

“I received your e-mail and letter in-forming me that I am a recipient of a Pacific Northwest Chapter of Certified Fraud Examiners 2009 Student Scholar-ship. I am very grateful for this award and want you to know that I appreciate so much the funds to continue my education. I am especially appreciative that you requested my scholarship application from the Association of Certified Fraud Examiners and submit-ted it to the Pacific Northwest Chapter for consideration. Had you not done this, I would not have been eligible for this award.

(1) Jill Kershaw, Saint Martins College e-mailed the Chapter as follows:

“Thank you so much for your e-mail informing me that I am a scholarship recipient. I really appreciate the support of the Pacific Northwest Chapter/ACFE regarding my completion of my bache-lors degree. After many years of being a stay-at-home mom, I am excited to com-plete this phase of my education and start on my second career. Again, many thanks from a very grateful student.” (2) Jill Kershaw also wrote the follow-

ing letter to the Chapter:

“After having been a stay-at-home mom for many years, my dream of completing my bachelor’s degree is about to come true. I am excited to finish this phase of my education and begin my second career. It is my goal to become a CPA and work as a fraud examiner. “Thank you so much for the schol-arship and for your work on my behalf. This award will indeed help me achieve my educational goals.”

E-Mail Message and Letter from Scholarship Award Winner

Report from Chapter Representative Meeting—July 12, 2009

chapter representatives attended the meeting which started with an intro-duction by Jeff Kubiszyn, ACFE Chap-ter Development Manager, and a dis-cussion and update on major Chapter issues. Jeff Kubiszyn then introduced a panel of four speakers. They were: Todd Randolph, Knoxville Chapter; Hal Huffer, Los Angeles Chapter; Lois Folk, Arizona Chapter; and Bob Ce-

dane, Middle Tennessee Chapter. The panel discussed the following top-ics: (1) Training issues and finding speakers. (2) Overcoming objections in recruiting new volunteers. (3) Chapter scholar-ships. (4) Enhancing the CFE credential. (5) The CFE and the economy. And, (6) ACFE branding .

Vice-President Dr. Norm Gierlasinski was our Chapter’s representative at the ACFE’s Annual Chapter Representative Meeting held in conjunction with the 20th Annual Fraud Conference and Exhibition at the Bellagio Hotel in Las Vegas, NV. He provided the following report on the content of the meeting: A meeting of ACFE Chapter representa-tives was held on Sunday, July 12, 2009, from 3:00—6:00 p.m. Seventy – six

Page 9 September/October 2009 Issue

senior and graduates in Decem-ber 2009. She serves as a transfer student coordinator at college and is a member of Beta Alpha Psi. She recently partici-pated in the Northwest Re-gional Best Practice competi-tion and received 2nd place for her efforts. She also prepares meals for her local church and organizes donations for the homeless in the area. Tessa applied for the ACFE scholarship through our Chap-ter and was one of the students we sponsored in the competi-tion. Binh Nguyen, Central Washington University (Lynnwood Campus), Viet-nam, $1,000. Binh has a 3.92 cumulative grade point average and is majoring in accounting. He volunteered for the Wel-come Orientation Week while at college. His goal is to be-come a CPA. He is currently active in the Society of Student Accountants and the student accounting club at college. Binh applied for the scholarship directly to the ACFE Founda-tion this year. (2) Pacific Northwest Chapter/ACFE’s Scholar-ship Program. Each year the Chapter awards $500 in scholarships to a maxi-mum of two students majoring in accounting or criminal justice programs at colleges and uni-versities in the great Pacific Northwest. This years winners from the great Pacific North-west included the following two students:

(1) ACFE Foundation’s Ritchie-Jennings Scholar-ship Program. Each year the ACFE Foundation awards $1,000 in scholarships to a maximum of 30 students majoring in accounting or crimi-nal justice programs at colleges and universities in two catego-ries: (1) United States; and, (2) International. This years win-ners from the great Pacific Northwest included the follow-ing three students: Joshua Pitzlin, Seattle Pa-cific University, $1,000. Joshua has a 3.66 cumulative grade point average and is ma-joring in accounting. He is a junior and plans to take the CPA examination after gradua-tion (June 2010). He is a mem-ber of Beta Alpha Psi, partici-pated in several intramural sports, and helped establish a new church in Issaquah. He has had part-time jobs while at-tending school. But, most nota-bly he is working as an intern at the Seattle FBI Office in its White Collar Crime Squad, where he was selected to par-ticipate in the FBI’s Honors internship Program in Washing-ton D.C. this Summer. He also works other part-time jobs while attending school. Joshua applied for the ACFE scholarship through our Chap-ter and was one of the students we sponsored in the competi-tion. Tsatsral (Tessa) Tseren-purer, Seattle, University, Mongolia, $1,000. Tessa has a 3.56 cumulative grade point average and is majoring in ac-counting and finance. She is a

Patrick Chen, Central Washington University (Ellensburg Campus), $500. Patrick has a 3.70 cumulative grade point average and is ma-joring in accounting with an economics minor and a supply chain management certificate. He is a junior and graduates in Summer 2010. He will be pur-suing the Master of Professional Accountancy Program after graduation. He is active in the Society of Student Accountants, was in the National Honor Society where he received the President’s Volunteer Service Award, and participated in computer clubs where he re-paired computers for schools. Patrick applied for the scholar-ship directly to the ACFE Foun-dation this year. However, he later contacted the Chapter and was one of the students we sponsored in the competition. Jill Kershaw, Saint Martins University, $500. Jill has a 3.92 cumulative grade point average and is majoring in ac-counting. She is a senior and plans to graduate in December 2009. She previously attended Centralia Community College where she was instrumental in arranging for President Joe Dervaes to speak to students in her accounting class. She has been pursuing an anti-fraud career almost all of her college years. Jill is also a Student member of our Chapter. Jill applied for the scholarship directly to the ACFE Founda-tion this year. However, she later contacted the Chapter and was one of the students we sponsored in the competition.

2009 Student Scholarship Program Awards

All of these individuals are outstanding students at their respective college or university, are active in extra-curricular activities on campus, and most often are employed part-time while attending school. They are all most deserving of these scholarship awards. The Chapter Board of Officers has sent congratulatory letters to each student scholarship winner. Please add your congratulations to them as well!

Page 10 The Fraud Examiner

Intense financial pressures during the economic crisis have led to an increase of fraud according to a survey of fraud experts conducted by the Association of Certified Fraud Examiners (ACFE). It is against this backdrop that the ACFE urges organizations world-wide to participate in International Fraud Awareness Week, Novem-ber 8-14, 2009, to help cast a spotlight on this urgent problem.

This weeklong campaign encour-ages business leaders and employ-ees to proactively take steps to minimize the impact of fraud by promoting anti-fraud awareness and education.

You and your organization can help make a positive impact in the

fight against fraud by taking the following steps today:

Become an Official Supporter. There’s no charge to become an official supporter of International Fraud Awareness Week.. You will receive downloadable anti-fraud resources, as well as a logo to post on your company or organi-zation’s web site. You will also be provided with a customizable press release to send to local me-dia announcing your involvement in this important movement.

Influence Future Professionals. Speak to local university students enrolled in business, management and accounting courses about the importance of being trained in the detection and prevention of fraud.

Reduce Risk. Send an email to

clients outlining the risks and cost of fraud. Encourage them to re-duce their fraud risk.

Spread the Word. Encourage other colleagues and students to become involved with the ACFE in the fight against fraud.

Host an Anti-Fraud Seminar. Hold a free fraud prevention semi-nar in your community. Download anti-fraud resources or contact info@acfe.com for more information.

To find out more about Interna-tional Fraud Awareness Week, contact: http://www.fraudweek.com/.

International Fraud Awareness Week: November 8-14, 2009

The Calgary Chapter/ACFE will be hosting a two-day fraud seminar on October 21-22, 2009, by a re-nowned authority on the topic of interviewing skills. The topic is "Verbal Skills in the Interviewing Dynamic". This hands-on seminar will practice techniques taught and develop proficiency in questioning and detecting deception in every-day, job responsibility related situations. The session will ad-dress the knowledge, skill, and abilities to communicate in a way that will cause others to respond

and ascertain if the interview is truthful. The speaker is Don Rabon, a much sought-after speaker who was named by ACFE as the "Speaker of the Year" in 2008. He retired as Deputy Di-rectory Western Campus, North Carolina Justice Academy and is an author/co-author of four books on the subject of interviewing. Over a period of 30 years, his instruction and investigative assis-tance has been provided to 14 countries. Participants in his courses have included the Behav-

ioral Science Unit of the FBI, the CIA, the US Secret Service and the SEC. Registration is $425 for Members and $495 for non-Members. This training qualifies for 15 hours of continuing profes-sional credit. Please contact Joanne Butz at: Joanne.butz@tsxventure.com for additional information about this training opportunity.

Annual Fraud Conference—Calgary Chapter / ACFE

Page 11 September/October 2009 Issue

Email Delinquent Account Scam Kicks It Up a Notch Solo attorneys have been tar-geted by email offering lucrative collection business for foreign manufacturers. The fraud goes like this: 1) establish an attorney client relationship with the attor-ney to act as collector; 2) claim an account has been settled and money will be sent to the attor-ney’s trust account; 3) send a forged foreign cashier’s check to the attorney (e.g. $50,000); 4) instruct the attorney to take his fees (e.g. 25%) and wire the bal-ance to the client; and 5) after the bank takes two weeks to determine the check is bogus, the attorney finds out the money wired has been lost. Although many have been vic-timized by the scheme, it was easy to detect. How could you believe that this offer would be made to you several times a month by manufacturers all over the world in emails addressed “Dear Sir or Madam”? If your inbox overflows with offers too good to be true and not person-ally addressed to you, ignore them. Also it helps if you do not wire money until you know the check is collected. Now, the fraudsters have be-come more creative and will use these new strategies to reach out to other industries. A recent example shows the direction

these frauds will be going. The attorney is now addressed by name by a woman in Japan who claims that her ex-husband owes her $450,000 in child sup-port and marital property. The fraud proceeded in small steps in a string of email. Eventually a fee agreement was requested. Then an address for the husband’s checks to be sent was requested. When asked for the husband’s name for a conflict check, the fraudster provided a fake name and address for the ex-husband. When asked for a copy of the divorce degree, the fraudster claimed it was a private agree-ment. Only asking for a retainer prevented this fraud from pro-ceeding. Maybe next time, the fraudster will send a small re-tainer? Fraudulent Conveyance – Wife Put Briefly on Title for Financing At trial, the court inexplicably held there must be a lien before a creditor can invoke the Uni-form Fraudulent Conveyance Act (UFTA) even though there is no such provision in the Act. The trial court reasoned that a judgment creditor was entitled only to recover the amount it would have received but for the fraudulent conveyance of the property. Since the creditors had not recorded their lien with the county auditor as required by statute, they could not collect

upon the judgment and were thus not injured by the wife’s conveyance to her husband. The wife had embezzled $500,000 and the couple filed for bankruptcy protection. The hus-band was exonerated of the crime. After the bankruptcy, a house was purchased by the hus-band and briefly put in wife’s name to obtain refinancing. Wife’s interest was then trans-ferred back to husband without consideration. The Court of Appeals reversed, pointing to the language of the statute in RCW 19.40.041, which states that a transfer may be fraudulent “whether the creditor's claim arose before or after the transfer was made or the obligation was incurred”. Douglas v. Hill, 148 Wash. App. 760, 199 P.3d 493 (Div. 1, 2009). John J. Tollefsen is the founder of Tollefsen law PLLC, an attor-ney, Certified Fraud Examiner, and Certified Controls Specialist. He may be contacted at: john@tollefsenlaw.com.

News From the Trenches—September 2009 By: John J. Tollefsen

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The Chapter Board of Officers

President Joe Dervaes

253-884-9303 joeandpeggydervaes@centurytel.net Vice-President Norm Gierlasinski

206-439-3800x3825 normang@cwu.edu Secretary-Treasurer Roger Gulliver

253-735-2392 rbg1@mindspring.com

Directors at Large Bernadette McBride 360-791-8824 bmcbride@dfi.wa.gov

Robert Goehring 253-856-5262 rgoehring@ci.kent.wa.us

Do you have ideas for our next newsletter? Want to write the review for the last fraud training you attended? We would love your feedback! Contact Joe Dervaes at joeandpeggydervaes@centurytel.net

Links to ACFE Chapters Pacific NW Chapter www.fraud-examiners.org Oregon Chapter www.oregon-acfe.org Spokane Chapter www.spokanefraud.org

Boise Chapter www.boiseacfe.org

Big Sky Chapter (Montana) kathy.arata-ward@josepheve.com

Vancouver, B.C. www.cfevancouver.com

Edmonton Chapter www.acfe-edmonton.com Calgary Chapter www.acfecalgary.com International ACFE Headquarters www.acfe.org

Financial Institution Fraud, Houston, TX, October 5-6, 2009. Money Laundering: Tracing Illicit Funds, Los Angeles, CA, October 19-20, 2009. Legal Elements of a Fraud Examination, New York City, NY, October 21, 2009. Financial Statement Fraud, SeaTac, WA, October 26-27, 2009. CFE Examination Review Course, Austin, TX, November 2-5, 2009. 2009 Pacific Rim Fraud Conference, November 15-17, 2009. Computer-Aided Investigations, Vancouver, B.C., Canada, November 16-17,

2009. Principles of Fraud Examination, Austin, TX, December 7-10, 2009. The ACFE contact point for all course offerings is Dianne Lloyd, Marketing Specialist, Events, by phone at 1-800-245-3321, or at the web-site www.ACFE.com. Contact her for more information and actual registration procedures.

Other ACFE Fraud Training Opportunities

Annual Fraud Conference, Calgary Chapter, October 20, 2009. Annual Fraud Conference, Boise Chapter, November 13, 2009. Annual Fraud Conference, Spokane Chapter, November 19-20, 2009. Joint Annual Fraud Conference, Pacific Northwest Chapter and Washington So-

ciety of CPAs, December 7, 2009. To register for our Chapter’s Annual Fraud Conference, contact the WSCPA's Education Operations Manager, Rachel In-galls, by phone at 1-800-272-8273, or register on-line at the WSCPA's web-site at www.WSCPA.org.

Other ACFE Chapter Annual Fraud Conferences