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False Accounting Could Mean Prison for Lawyer

Falsifying any accounting records - including expense reports - can be a serio

It's not just CFOs who need to worry about being accurate in their accounting.

The Financial Times reports that a well-known lawyer in London, Christopher Grierson, was accused of giving his former employer false travel invoices. He was charged with four counts of supplying false information to law firm Hogan Lovells, and in four years allegedly sent 57 invoices totaling £1.27 million, the newspaper said.

Although he paid the money back to the firm before being arrested in June 2011, Grierson could receive a prison sentence of up to seven years, the maximum penalty for false accounting, according to the source.

"Christopher Grierson used his status as a partner within a high-profile law firm to defraud the people he had worked alongside for the past 30 years," said the City of London Police, as quoted by the FT. "His betrayal of their trust initially left him better off but ultimately it has destroyed a professional reputation that has taken a lifetime to build."

In an interview with The Lawyer, Sue Patten of the CPS central fraud group said that the message from the Grierson proceedings was that any case of fraud is a serious matter, especially if it involves abusing trust.

Comments

Topic Expert
Regis Quirin
Title: Director of Finance
Company: Gibney Anthony & Flaherty LLP
LinkedIn Profile
(Director of Finance, Gibney Anthony & Flaherty LLP) |

Going down a different path. This situation is quite common when you do not require Manager approval for the submitting of expenses. If your policies protect the company against fraud, you have a higher likelihood (not 100%) of it never occurring. But without proper controls, you are accepting a certain element of Risk.

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

As well as what types of expenses are acceptable, how many company personnel can be involved, etc., etc.

T&E can wreak havoc on working capital with little or no positive effect. Unscrupulous employees can use all manner of fake invoices/vendors for embezzlement. But this is preaching to the choir...

Topic Expert
Barrett Peterson
Title: Senior Manager, Actg Stnds & Analysis
Company: TTX
(Senior Manager, Actg Stnds & Analysis, TTX) |

This is theft by fraud, with a variable punishment, but a crime everywhere in the US asa well. Lawyers can also get in trouble with securities laws violations involving corporate accounting violations if they participate or facilitate.