The Phar-Mor Fraud Case

This is primarily a case of gluttony and self-indulgence. Phar-Mor received a bill for inventory that was not received from Tamco, its sister company. To make matters worse, when it came to properly recording inventory that was received from its sister company, Phar-Mor dropped the ball drastically and failed. With the unsound bookkeeping it made it difficult to separate the products received. Michael J. “Mickey” Monus, the then Vice President, took over 15 million dollars and transferred to the World Basketball League (WBL) in order to offset their loss. Monus owned 60% of the ten teams that were a part of the WBL and was financially responsible for each team’s losses. In order to cover up a case this huge it took meticulous planning and a great deal of communication between upper management. The understanding at which came from how to conduct audit procedures and how to allocate them was great. The Fraud Team, which consisted of: Mickey Monus, President, Patrick Finn, CFO, Jeff Walley, Vice President of Finance, Stanley Cherelstein, Controller, and John Anderson, Accounting manager, all were auditors at the company Coopers and Lybrand. With the fraud team being former auditors, it makes it extremely easy to cover up the fraud at hand. THE

Waste Management extended the life span for the Plant, Property, and Equipment accounts. The Securities and Exchange Commission websites stated the charges brought against the company were due to purposely manipulating the financial documents to boost the company’s earnings because the revenue was not meeting the target that which they had set forth. Buntrock, Rooney, Koenig, Hau, Tobecksen, and Gertz primarily eliminated and deferred current period expense in hopes to increase earnings. They bypassed many laws to accomplish this