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Confirmation.com in the News

Latest Confirmation.com News

Confirmation.com Assists Auditors in Uncovering Fraud at China MediaExpress
Confirmation.com helped auditors uncover the fraudulent activity of China MediaExpress, a China-based company that traded on a U.S. stock exchange.  When one of the banks switched from paper confirmations to Confirmation.com, the company’s CEO could no longer misdirect the auditor’s bank confirmation requests and even resisted authorizing the bank to directly provide the auditor with copies of the company’s bank statements.  After the auditor formally resigned from the engagement, a forensic accounting firm was brought in and was able to obtain bank statements directly from each of the banks, which showed massive discrepancies. Read Confirmation.com's press announcement.

Confirmation.com Uncovers Another Multi-Million-Dollar Financial Fraud
In less than nine months after uncovering the $215 million Peregrine Financial Group (PFG) fraud, Confirmation.com was used to uncover financial fraud by an investment fund owner and operator in North Carolina. The company's owner pled guilty to stealing millions of dollars from more than 100 investors over a seven-year period. Read Confirmation.com's press announcement. Read the FBI's press release.

Accounting Today TV
New Trends in Financial Reporting Fraud
http://www.accountingtoday.com/video/?id=65792&page=1
In an interview with Daniel Hood, Editor-in-Chief of Accounting Today, Brian Fox, Founder of Confirmation.com discusses the latest trends in financial statement fraud.  In this segment, Brian talks about the one thing many of the recent frauds had in common that allowed them to go undetected for so long.

Accounting Today TV
The Future of Auditing
http://www.accountingtoday.com/video/?id=65791
In another interview with Daniel Hood, Editor-in-Chief of Accounting Today, Brian Fox discusses the future of technology in auditing.

Inc. Magazine
Unexpected Key to This Start-up’s Success
http://www.inc.com/jeff-haden/how-we-made-southwest-our-corporate-jet.html
Confirmation.com was featured in Jeff Haden’s Inc. Magazine column regarding our using Southwest Airlines as a growth tool for our company.

CNBC.com
Hackers Doing No Favors for China’s Image
Katie Holliday, a reporter for CNBC.com covering Asia business news, interviews Brian Fox in her recent article detailing the collateral effects of Chinese hacking on China/U.S. business relations. Read the entire article here.​


Peregrine Financial Group Fraud

Confirmation.com played a significant role in exposing the Peregrine Financial Group (PFGBest) multi-year $215 million fraud. Below are several articles that recently appeared in the U.S. national media illustrating how it was the switch from paper audit confirmations to Confirmation.com that uncovered the PFGBest fraud.  The articles detail how Peregrine’s founder and Chairman Russell Wasendorf, Sr. defrauded clients by easily circumventing the auditor’s paper confirmation process for many years, that he adamantly resisted the switch to electronic confirmations through Confirmation.com, and how his fraud was revealed within 24 hours of using Confirmation.com.  

Cover Article in the Wall Street Journalhttp://online.wsj.com/article/SB10001424052702303740704577524873909864282.html 
Mr. Wasendorf's alleged fraud was exposed after the National Futures Association, Peregrine's front-line regulator, dispatched an audit team in recent weeks to Cedar Falls to review the firm's books and pressure the executive to sign on to a new, online system for verifying accounts. The system, called Confirmation.com, likely would have rendered the fraud unsustainable. Mr. Wasendorf resisted signing the necessary form for several days, prompting the NFA to threaten stronger action against Peregrine, according to a person familiar with regulators' investigation. Mr. Wasendorf relented and signed on Sunday, the person said.  

Forbes:
http://www.forbes.com/sites/walterpavlo/2012/07/13/pfgbests-wasendorf-arrested-the-audit-confirmation-that-caught-him/ 
Brian Fox, Founder and Chief Marketing Officer of Confirmation.com,has been lecturing for years on the frauds that could be perpetrated through audit confirmations. In addition to lecturing, he decided to do something to prevent it and on Monday, Confirmation.com played a big part in catching a big fish; Russell Wasendorf, Sr., Chairman of PFGBest. 

New York Post
http://www.nypost.com/p/news/business/final_days_of_peregrine_financial_UtT9op6RRWYispreDTl7KK
On Sunday afternoon, Wasendorf granted regulators permission to access the firm’s financial records via a new electronic system, The Post has learned. The change meant that the National Futures Association could directly retrieve the firm’s financial records, making it difficult — if not impossible — for Wasendorf to continue mailing allegedly phony paper documents. The following morning, the same day the NFA was initiating its first electronic confirmation of Peregrine’s bank accounts, Wasendorf was discovered unconscious in his car after running a hose to the tailpipe. The NFA had begun rolling out the electronic system, Confirmation.com, in March, around the same time of Peregrine’s annual audit last year. 

New York Times:
http://dealbook.nytimes.com/2012/07/12/at-peregrine-financial-signs-of-trouble-seemingly-missed-for-years/?ref=business
The N.F.A. was in the middle of changing part of its audit process to an online platform, where bank statement information would feed directly to the regulator. This month, Peregrine was facing its first audit under the new system, called confirmation.com, and Mr. Wasendorf was opposed to the system, according to people with knowledge of the matter.  He fought the directive for several days, the person said, until relenting on Sunday. The N.F.A. started getting confirmations through the system Monday morning.  

Forbes:
 http://www.forbes.com/sites/walterpavlo/2012/07/13/pfgbests-bad-week/
On Sunday, July 8th, PFGBest, a commodities trading firm, had allowed the National Futures Association (NFA) to conduct 3rd party confirmation of its banking records through the automated system provided by Capital Confirmation. The move was something that PFGBest Chairman, Russell Wasendorf, Sr. had put off for some time because, apparently, he was providing false financial information purported to be from his firm’s bank that showed over $200 million in the bank when in reality there was under $10 million.  

New York Post:
http://www.nypost.com/p/news/business/hot_on_his_trail_LZ0ah6AoVILmHZPi35qcYL
Sources close to the matter told The Post the regulator started putting pressure on Wasendorf in March — pushing PFG and all commodity brokerages to shift to an electronic reporting system for annual audits.  A spokesman for NFA yesterday confirmed that the agency started moving all brokers to the audit program, Confirmation.com. The regulator aims to have all brokers on board with the new system by the end of the current audit schedule, said spokesman Larry Dyekman, who declined to comment about Peregrine specifically.

New York Observer:
http://observer.com/2012/07/now-you-too-can-commit-financial-fraud-a-la-pfg-founder-wasendorf/
Now You Too Can Commit Financial Fraud a la PFG Founder Wasendorf.  Mr. Fox is the founder and chief marketing officer at Confirmation.com, the company whose system for electronic confirmation the National Futures Association was in the process of adopting when it stumbled upon Mr. Wasendorf’s fraud. Mr. Fox said his company’s clearinghouse made auditing more efficient, and was a step on the path towards “constant transparency.” For the moment we wanted to share with you a presentation Mr. Fox made last year, in which he teaches a room full of auditors to create a phony stand-in for the website of their favorite lender. Paper, after all, is dying, and as Mr. Fox told us, “If a fraudster can’t go one way, he goes the other.”

Fortune:
http://management.fortune.cnn.com/2012/08/16/preventing-a-peregrine-repeat-for-less-than-a-dollar-a-day/?section=magazines_fortune
Preventing a Peregrine repeat for less than a dollar a day. In contrast to a paper-based process, electronic confirmations use additional security mechanisms to ensure that whoever confirms an account balance during an audit has the appropriate credentials to do so.  According to Fordham accounting professor Barbara Porco, who has worked on a research project with Confirmation.com, "A fraudster may be able to create false verification; however, the electronic process makes it more challenging."

 

Questions? Please contact Jackie Lucas for more information.