You've got to wonder what he was thinking

http://fw.to/OTestVB

Sure, it looks like a garden-variety theft story at first:  guy with some authority embezzles money from his company.  Except that his company is a Christian high school, and he's the CTO.  I guess a high school can give its workers whatever title they want.

Apparently, he robbed and closed out the school's PayPal account in what amounts to the least subtle and clever form of theft possible.  And what exactly is the school doing with a PayPal account anyway?  Bidding for used Bibles on eBay?

Finally, an odd point about this case:  He wasn't charged with money laundering.  Given how common the charge is these days, this suggests either the prosecutors have been living in a cave for the past decade or the guy didn't actually try to do anything to launder the money. In white-collar prisons, is it considered a badge of shame to be so stupid you aren't charged with money-laundering?  It should be.

Enforcement Actions: Larry Crawford

Reading my posts is bound to be faster than reading the legal pages, even though they're not usually very long.  Plus, it's a way for me to keep up on enforcement actions.

Date:  September 21, 2011
Who:  Larry Crawford, CPA
What he did:  Failed to disclose relationship between Escala (sub) and parent company, and represented sale of stamps as being based on objective third-party prices when it was actually determined by a related third party controlled by the former Escala CEO.
Punishment:  3 year suspension on practicing before the Commission, and under $43,495 disgorgement
$21,089.75 interest
$100,000 civil fine

$164,584 total

Perhaps it's worthwhile to note that for five years, Crawford was the CFO and Executive VP of Escala, and before that he has CFO positions extending back to 1987.  Additionally, what's Crawford doing now?  He's CFO at Arkados Group, a company that makes semiconductors.  So I guess the $164K is a minor sting for someone who's probably a multimillionaire.  I guess price-fixing pays off. 
Securities and Exchange Commission v. Escala Group, Inc., et al.

Overregulation

It's hardly a surprise that pro-business FOX news thinks business regulations are a bad idea, or at the very least overdone.  And they do have something of a point:  complying with regulations often comes with a cost, sometimes substantial.  Somehow, though, this regulation and concurrent cost is never considered "job-creating".  The Bureau of Labor Statistics forecasts a 31% increase in private sector compliance jobs from 2008 to 2018.  Rather than being lauded for promoting measures to protect consumers, create jobs, and preserve the environment, Obama is castigated as being unfriendly to business.

One of the primary targets for regulation is the financial industry.  This regulation tends to be complex, largely because of the variety of instruments and techniques available in the suite of business and business models inherent in the industry.  For larger organizations, the cost increases considerably -- so keep in mind that when you look at "average" compliance costs for firms, what you're seeing is a combination of a lot of small firms with comparatively low costs and much larger firms with very high costs, not a standard Gaussian distribution.

The problem with compliance regulations isn't primarily that there are too many of them, but that they're not very effective.  Sometimes regulatory agencies make what should be relatively simple compliance more expensive than needed, and other times agencies focus on nits that really don't do anything to protect consumers, the industry, or anything else.

This blog will focus on regulations within the financial industry, their effects and efficacy, and related issues.  Honestly, I'm not sure I won't drift a little to other areas of law, but I'll try to keep it fairly focused and update at least every couple of days.