Again, if an investment firm was planned and created to perpetuate a Ponzi scheme, one can only take the blue print from BMIS and make improvements to it.
However, since this question is asking for a more comprehensive answer, we need not just look at the firms’ organizational controls but we should look at other agencies and or auditing firms as well.
First, the most important organizational control to implement in a case such as this one is a whistleblower program. However, one might argue; if the top is corrupt and did not formed an independent audit committee to oversee the organizational structure and controls there is not much one can do from the inside. Since the article inferred that collusion was rampant throughout the firm. The program should also include extending this information to other parties such as SEC, Federal Bureau of Investigations, as well as one could also inform reputable news agencies of this type of …show more content…
Since that would be almost impossible to implement and inforce, we need to look to the auditors for putting into action and scrutinizing practices of companies as well as governing auditing bodies to lobby government for legislative changes. Therefore a compliance audit is required here. An annual compliance audit from a firm that is independent from BMIS in fact and appearance would have been crucial in finding and reporting fraud. This would have determined whether BMIS was complying with external criteria such as specific laws i.e. order flow which was mentioned. The policies and procedures that Peter Madoff the Chief Compliance Officer (CCO) had created but did not adhere to would have been discovered. What is more a compliance audit of the firm would have found that internal controls were not
However, since this question is asking for a more comprehensive answer, we need not just look at the firms’ organizational controls but we should look at other agencies and or auditing firms as well.
First, the most important organizational control to implement in a case such as this one is a whistleblower program. However, one might argue; if the top is corrupt and did not formed an independent audit committee to oversee the organizational structure and controls there is not much one can do from the inside. Since the article inferred that collusion was rampant throughout the firm. The program should also include extending this information to other parties such as SEC, Federal Bureau of Investigations, as well as one could also inform reputable news agencies of this type of …show more content…
Since that would be almost impossible to implement and inforce, we need to look to the auditors for putting into action and scrutinizing practices of companies as well as governing auditing bodies to lobby government for legislative changes. Therefore a compliance audit is required here. An annual compliance audit from a firm that is independent from BMIS in fact and appearance would have been crucial in finding and reporting fraud. This would have determined whether BMIS was complying with external criteria such as specific laws i.e. order flow which was mentioned. The policies and procedures that Peter Madoff the Chief Compliance Officer (CCO) had created but did not adhere to would have been discovered. What is more a compliance audit of the firm would have found that internal controls were not