Case Study : ' Catch Me If You Can ' And Show How Fraud Was Committed By Floating Checks And

803 Words Sep 8th, 2016 4 Pages
Ahi Tuna Kiting There have been several stories about people circumventing the check cashing system for over one hundred years and several people were incarcerated for numerous years while committing related crimes including fraud. One notable example is Frank Abagnale Jr. who is portrayed in the movie “Catch Me If You Can” and shows how fraud was committed by floating checks and forgery. An employee of Ahi Corporation has suggested a scheme to utilize the postal system for receiving interest income while the check is in the mail. The plan is an attempt to increase the time to mail to the Internal Revenue Service (IRS) and for them to receive and cash the check. The focus of the research is on the accountant’s recommendation concerning the scheme including the potential ethics concerns and how the AICPA and SSTS codes and standards govern the actions of the accounting professional. Recommendations to the company is not following the scheme because it is unethical to intentionally and knowingly extend the time to reap the unearned benefits of interest income from the bank. However, the use of the float by the corporation is the same as the float that is used by the banking industries. For instance, Levmore (1981) states that banks will utilize the ‘lag period float’ to gain income during the time the bank held the check to allow it time to clear the Federal Reserve system (p. 820). This is not an illegal transaction, however, this is check floating or check kiting…

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