The ripple effects of the 2008/2009 financial crisis still echoes throughout most US industries today. Fraudulent acts of certain “bad actors” – both individuals and firms in the financial industries during this time – are also still being discovered today. Take for example the now-defunct international law firm Dewey & LeBoeuf, who according to a March 6, 2014 press release issued by the Securities and Exchange Commission (“SEC”), has been charged with creating a $150 million fraudulent private bond offering. According to the release, this offering misled investors on the financial health of the law firm, which was struggling as a result of the recession, “steep costs from a merger”, and surmounting fear of severed credit lines from bank lenders.

Accounting fraud lies at the center of the scheme, with five (5) high-level executives and financial personnel – from the chairman and executive director, to the CFO, financial director and controller – participating in manipulative accounting-related actions which “artificially inflated income” by $36 million (15 percent) in 2008 and $23 million in 2009, and “distorted financial performance” to create “blatantly falsified financial results”. These results were then reported to investors in order to sell bonds, giving the illusion that Dewey & LeBoeuf was “a prestigious law firm that had weathered the financial crisis and was poised for growth.” The culture of accounting fraud at the firm was so rampant, the SEC alleges, that email correspondence evidence showed admissions of bonuses and misdealings throughout upper management – and even a $7.5 million line item deduction labeled “Accounting Tricks.” Though many suffered major financial losses during the Great Recession, the executives and finance professionals associated with the now non-existent Dewey & LeBoeuf will likely experience a wealth of regulatory woes in the post-financial-crisis age of 2014.

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