Although this story surfaced in September of 2009 in the Financial Times, I thought it was noteworthy enough to list here under Cases of Fraud & Errors linked to the uncontrolled use of spreadsheets. In many cases, personal motivation, lack of adequate controls, and the autonomy granted to users to make unauthorized (or fraudulent) changes to key spreadsheets has led to cases of errors and fraud. The Madoff case is no different, but in this scenario it was perhaps the source of data (and not the actual spreadsheet) that was fraudulent.
The story summaries the inner workings of the Madoff operation and how spreadsheets were updated through queries into an old AS/400 main frame system which tracked false trades, each resulting in a 1 cent profit. Using a simple spreadsheet, his client’s accounts were all magically updated - unbelievable!
Read the Full Story.
Eric Perry
0 Responses to “Spreadsheet Fraud Linked to Madoff Case”