Tyco International Case Study

Decent Essays
Tyco International had two top executives that were indicted on charges of misappropriation of assets. Dennis Kozlowski was named Tyco’s Chief Executive Officer in 1992 were he was credited for his mergers and acquisitions from start of working with Tyco in 1975. Kozlowski shared this indictment with Mark H. Swartz, Chief Financial Officer. Swartz received 38 felony charge count and misappropriated over $170 million from Tyco International and $430 million through fraudulent sales of stock. Between the two they used monies to pay for items ranging from an apartment on Park Avenue, homes in Boca Raton, FL to jewelry from Tiffany’s. On one occasion Kozlowski had Tyco International pay the bill for a multimillion dollar 40th birthday party …show more content…
Even when you have internal controls are being broken, if fraud is being conducted at top level of management others may feel that actions of this sort may be acceptable at some point. They may feel it isn’t their place to question top executives, because they can very well state I work harder for the corporation therefore, I’m due additional reimbursement. Anti-fraud activities can be defensive and/or investigative in character. Defensive controls are meant to lessen the precise fraud risk and discourage future fraud, whereas detective controls activities are meant to recognize fraud when it happens. Detective controls can also be used as a screening activity to evaluate current antifraud controls. It can show additional inefficiencies in the internal controls. Utilizing IT systems to control activities that are currently present can purposely address the fraud risks (IIA, 2016). I purpose that controls be put in place that supersede the controls of administration. Listed are some controls that transact with an organization that require …show more content…
The materials that are found for fraud is normally bound by administration and staff members and those accountable for corporate governance. It is vital that corporate governance be included in the fraud risk assessment. It is also vital that fraud risk assessment be included in an owner’s business course of action. There are many fraud risk factors that don’t signify deception but, can be present in conditions that break fraud, such as (Taub, 2002):
 Attitudes/Rationalizations the procedures by which a person commend a scam legitimizes or justified the offense is explained
 Pressures can be actual or professed but the pressure is typically shaped by conditions the perpetrator perceives himself to be
 Opportunities if internal controls are insufficient monetary reporting or consternating assets may be easier to execute proof transactions or

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