Latest
My Latest Forbes Magazine Article: “The Madoff of Munis”
Taxpayers are getting killed. I think municipal bondholders are next.
The Big 4 And Globalization
How Deloitte US May Be Held Liable For ChinaCast Fraud»What’s different about this Chinese fraud lawsuit is that it names a US Big Four firm as a defendant. Not only has that not been done before but the US firms have traditionally been able to insulate themselves fairly successfully from frauds that happen abroad. It’s that global network “thang”.
Unaudited! Not Just A China Problem So How Do We Address It?»
It’s sexier for the media to focus on audit failures by inscrutable China-based Big Four audit firms than the general failure of auditors all over the world to protect investors from fraud.
Auditors Diss US Regulators Regarding China»
I’ve been watching the developments for a while now between the global audit firms, their clients, the regulators on both sides, and investors – especially the shorts – who have been raising the issues of Chinese frauds. I’ve written quite a bit about these issue. If you’re playing catch up, this list of posts is a good place to start.
Where I've Been
Speaking Engagements/Conferences»Here’s where I’ll be and where I’ve been. I’ve added a link to the text from my speech at Texas Tech this past week and a link to an interview in March with Broc Romanek at TheCorporateCounsel.net blog on aduit industry developments.
McKenna Speaks to Market Technicians Association Chicago»
On February 19, 2013, I spoke to the Chicago Chapter of the Market Technicians Association. The topic was, “Risk 2013: Protecting Your Trading Accounts From Fraud”.
McKenna Appears On “Chicago Tonight” Talking About Business Ethics»
I appeared July 17 on Chicago Tonight, a nightly news program produced by WTTW, Channel 11, the public television station in Chicago. The show is hosted by Phil Ponce, a very interesting guy who was really good at wrangling the three cats on this panel. I was joined by John Lothian and Professor Laura Pincus-Hartman of [...]
The Case Against The Auditors
Who Is The PwC Partner Responsible For MF Global? Someone With A Lot of Baggage»It’s important for the integrity of the capital markets to assign individual responsibility for audit failures. We need to see the key partners’ names and their career histories because recidivist partners are hiding behind the firms which are very good at dodging general liability.
Scott London Subverted Sarbanes-Oxley: Big Four Mock Audit Partner Rotation»
I noticed a small little thing in one of the first stories about Scott London. As I tried to research and write about it, I waited for someone else to pick up on it. (No one else did.) Scott London seems to have subverted the intent of Sarbanes-Oxley Section 203 that requires lead engagement partner rotation off engagements to promote objectivity, independence and professional skepticism.
Early Returns: Scott London, KPMG and Another Partner Trading On Inside Information»
This is the fourth big insider trading case in the least few years against a senior tenured partner that betrayed the public’s trust. In none of the cases did the firm’s “extensive” and “comprehensive” independence compliance programs spot the behavior or the illegal actions. Stay tuned. There will be much more to this story, I guarantee.
Your Career
Blogging – My Religion»So, if you’ve ever wanted to put your stuff out there, tell your story, be judged on what you know, not what box you may have found yourself in…
Just do it. It’s not hard. It’s pretty forgiving. It’s neat.
“Wait! I Was Just Getting Started…”»
“If we are always arriving and departing, it is also true that we are eternally anchored. One’s destination is never a place but rather a new way of looking at things.” Henry Miller
Madoff, MLK, Buddha And Elusive Nature of Self-Interest»
Your first obligation as a professional is to your client, not your firm, your partners, or even your family.
The Big 4 And Consulting
A Summary of Writing on the “Independent” Foreclosure Reviews and the AG Mortgage Settlement»Here’s a compilation – updated – with links for the columns/posts I’ve written about the mortgage servicer foreclosure reviews mandated by the April 2011 SEC/Fed consent orders, the April 2012 Attorneys General mortgage settlement and the intersection of the two regulatory actions.
Foreclosure Settlement Shuts Down Reviews: Banks Will Continue Business As Usual»
It’s easy to forget, with all the propaganda being published by major media, why these Fed/OCC consent decrees were issued in the first place. The fact that a borrower may be in default does not negate the overwhelming evidence that court cases have provided that banks proceeded fraudulently and illegally in some foreclosures and looted those borrowers and institutional investors in mortgage securities by charging fraudulent and illegal fees in the process.
PwC and Thomson Reuters: Too Close For Comfort»
Here’s the thing…The perception of auditor independence is as important, or maybe even more important, than the fact of auditor independence. This is not new.
Writing for Others
Writing For University of Chicago Booth Capital Ideas»I’m writing for the University of Chicago’s Booth Graduate School of Business Capital Ideas Magazine and blog now, too. The purpose is to highlight faculty research.
McKenna Finalist For UCLA’s Loeb Awards For Business Journalism»
I have been named a finalist for UCLA’s Gerald Loeb Awards for my work in Forbes magazine last year. I’m a “professional who writes” but also a professional writer and a journalist. You’ve been warned.
Jeff Connaughton’s “The Payoff: Why Wall Street Always Wins” – A Book Review»
Jeff Connaughton’s new book, “The Payoff: Why Wall Street Always Wins”, is a must read during the Presidential election season.
You Can Quote Me On That
Berkshire Hathaway and Swiss Re: It Wasn’t Really A Win-Win»Like a lot of things Buffett and Berkshire, there’s more to the Swiss Re dispute resolution story than the snappy repartee tells you.
How KPMG Explains Scott London To The Accounting Professors»
Here’s how KPMG Chairman John Veihmeyer explained Scott London’s inside trading and the firm’s response to accounting professors, an important stop in the audit industry supply chain.
E&Y, Their Audit Client Wal-Mart, and Value Pricing»
This post about Ernst & Young’s aggressive tax advice to audit client Wal-Mart was originally posted October 29, 2007. It’s worth everyone – I’m talking to you SEC and PCAOB – taking another look at this given Wal-Mart’s new Mexican bribery problems and the SEC investigation of Ernst & Young for tax lobbying to audit clients. (Ernst & Young has been silent and left out of most media discussion about Wal-Mart’s FCPA problems in Mexico and elsewhere.)
Food for Thought
An Interview For The Society of Professional Journalists Region 1 Conference»David Levitt of the Society of Professional Journalists Region 1 in New Jersey
asked me back in April to answer a few questions for a conference panel I, unfortunately, could not attend live.
McKenna Writes For Accountancy On Offshore Profit Shifting By Multinationals»
Multinationals are under increasing scrutiny for income shifting and offshoring profits. I reported on the issues and U.S. legislative status in December in Accountancy, a magazine for the profession in the UK.
McKenna Writes For “Investor Advocate” From Law Firm Bernstein Litowitz Berger & Grossman»
BLBG publishes the Advocate for Institutional Investors, a quarterly newsletter which contains reporting and analysis of the latest securities and corporate law issues. The Advocate often features articles by the management and general counsel of some of the largest public pension funds in the country, as well as some of the nation’s premier securities litigators. This Spring the magazine also features my writing on the subject of private litigation against audit firms.
Francine McKenna (@retheauditors) has more than twenty-five years of experience in consulting and professional services including tenure at two Big 4 firms, both in the US and abroad. Look for my column, 
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