Accuracy uncovers fraud at a large IT manufacturer

Business case

Accuracy uncovers fraud at a large IT manufacturer

Context

Our client is one of the largest manufacturers of personal notebooks. In Italy, the group operated primarily through two subsidiaries on which we focused our engagement. A handful of employees had created unlawful sophisticated mechanisms, which were extremely difficult to reconstruct, to manage the group’s advertising expenses, damaging several group and non-group businesses in the process.

Key Takeaway

This engagement was complicated due to a lack of information and the level of sophistication of the scheme, which the defendant developed to cheat their employer out of millions of euros. Our added value in this engagement was the skill with which we handled a significant amount of data (both on paper and in Excel), which was misleading, incomplete and even various languages. In addition, our team was able to translate the fraud scheme into a simple format so that it could be easily understood by both the judge in the court case and our client.

Accuracy Role

An overall view of the mechanism was obtained by reconciling (i) the purchases of processors/operating systems, (ii) marketing expenses incurred and (iii) funds made available to the company, as well as by discovering the total overcharge performed on each subsidiary. Our work was structured in four phases: Phase 1 – reconstruction of events and identification of the entire unlawful mechanism and damages quantification. Phase 2 – performance of forensic due diligence on three subsidiaries for four financial years to assess the fraud arising from the mismanagement of the supply chain. The fraudulent activities were wilfully designed by the top executive and his complicit team to obtain personal benefits. Phase 3 – support for the Italian tax authorities in further analyses through new evidence arising from investigations requested by the judge. Phase 4 – support for the criminal lawyers in preparing a criminal complaint.