The city of Dixon, Illinois
announced on September 25, 2013 it would receive a $40 million settlement from
CliftonLarsonAllen, Fifth Third Bank, and Janis Card and Associates for the
fraud Rita Crundwell committed and was not detected by the CPA firms or the
bank.
I followed up with the
Illinois Department of Financial and Professional Regulation to determine if
the Department had considered investigating or had taken disciplinary action
against the Certified Public Accountants involved in the audits of
Dixon, Illinois.
According to
the Department's web page:
“The Department’s mission is to protect and promote the
lives of Illinois consumers.
We regulate most of the professionals and financial
institutions that Illinois families depend on everyday - from banks to
veterinarians and almost everything in between. We also work with the licensed
professionals, members of the General Assembly, law enforcement officers,
consumer groups and concerned public citizens to make sure that unscrupulous
businesses and incompetent professionals can't take advantage of their
customers and clients.”
According to the Department’s web site, no disciplinary
action has been taken against any of the major participants in the Dixon,
Illinois audits.
In responding to my Freedom of Information
Request, they simply said, “Pursuant to the Act [Illinois Freedom of
Information Act], your request does not seek to produce a particular public
record.”
Two of the people I inquired about have active
licenses, one has an inactive license and one has not renewed his license.
Interestingly, Ronald J. Blaine, one of the
partners doing the audits was previously disciplined on February 28, 2000. The
reason for the disciplinary action: “[Mr. Blaine] [a]llegedly authorized the
issuance of an unqualified opinion on financial statements that may have failed
to fully disclose the financial conditions of one company.”
That sounds very similar to what occurred in
Dixon, Illinois. The Department though would not tell me the name of the
company the partner was auditing for which he was reprimanded.
Another partner, while not disciplined, has
allowed his CPA license to become “inactive.” A search on the Internet though
shows he continues to use the CPA designation. Here’s one of his web sites:
“For tax preparation in Sterling, Illinois, you can count
on Samuel S. Card, CPA at Samuel S. Card, CPA P.C. Samuel S. Card, CPA assists
taxpayers and small businesses with taxes in Sterling, Illinois and the
surrounding communities. Whether you are an individual or a local business in
or around Sterling, Illinois, Samuel S. Card, CPA has years of valuable
experience as an IRS registered tax preparer.
Contact Samuel S. Card, CPA, tax filing specialist in
Sterling, Illinois, for help with your taxes.”
I called Mr. Card’s office to see if he was
still working. A woman answered the phone. When I questioned her if Mr. Card
was practicing as a CPA, she indicated he was not. She said he was working as
an accountant.
I’m not sure how the Illinois Department of Financial and Professional Regulation can, “make
sure that unscrupulous businesses and incompetent professionals can't take
advantage of their customers and clients” if there is no “particular public
record” available about an investigation into this incredible failure to find a
$53 million fraud that occurred over a 22-year period.
Dave,
ReplyDeleteYour provide a great service to us all through your attention to the details -- right through the end of the story. It's so disappointing that these oversight professionals failed to act. How much more clear does the need for swift and decisive action to protect the public need to be before the Illinois regulators demonstrate the courage to do their job? Congratulations on your work. Keep swinging, my friend.
John Hall (John@JohnHallSpeaker.com)