When bread and conscience are weighed against each other, in time of calamity, it is not to be wondered, at the former, will preponderate. Custom and the fashion of the World will not always stifle the voice of conscience. The United States Attorney’s Office remains committed to uncovering and prosecuting fraud and abuse. Originally hired to oversee corporate conduct—from preventing theft of company time, to endangering the environment, to selling corporate secrets, many ethics officers are there to guard the corporation and manage the employees.

Recent government legislation designed to punish corporate wrongdoings is another factor influencing ethical behavior. There is an independent regulator board with investigative and enforcement powers to oversee the accounting industry and punish corporate auditors. It also required corporate executives to certify their companies’ financial statements and set new penalties for securities fraud and document shredding.

The following cases were investigated and prosecuted in coordination with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.

With more than 20 federal agencies, 94 U.S. Attorneys’ Offices and State and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to battle fraud. Fraud is the intentional misrepresentation of the truth in order to induce another person to part with something of value or surrender a legal right.

Financial fraud became a major concern after Tyco, a sprawling conglomerate, with annual revenue of $36,000,000,000.00, Chief Executive Officer L. Dennis Kozlowski and former Tyco Chief Financial Officer, Mark H. Swartz and former chief legal officer Mark A. Belnick, were charged with having stolen more than $170,000,000.00 from the company and with defrauding investors by illegally reaping $430,000,000.00 from company stock sales, and entered into other secret transactions with the company.

L. Dennis Kozlowski and Mark H. Swartz allegedly authorized the forgiveness of $49,000,000.00, in loans, to dozens of Tyco executives to keep them loyal, all while investors felt the sudden wrenching away of the ground beneath their feet.

L. Dennis Kozlowski allegedly siphoned company assets for lavish expenditures, including a $16,800,000.00 apartment in Manhattan, New York and $14,000,000.00 in real estate renovations and furnishings, a $72,000.00 yacht, and a $6,000.00 shower curtain and a $10 million home in Park City, Utah —just to name a few of the more modest purchases. The clatter of cutlery grated on my nerves.

Fraudulent stock trading, sending delusion and hope and longing, all tumbling one after the other like a falling line of dominoes, L. Dennis Kozlowski, Mark Swartz and Mark Belnick also sold their shares of Tyco stock valued at millions of dollars while their self-dealing remained undisclosed, it was after all, a path well worn.

A decade of mourning leaves its footprints on the heart of the economic system, due to such complex cases of fraud—crippling, overpowering investors leading to the dreaded recession of 2008; a suggestion of old values and time unchanging for generations, coexisting with the demands of the twentieth century.

With hindsight, I see that all these emotions assaulted me simultaneously from Adelphia, WorldCom, and Enron. The sun falls early in those high valleys and the shadows were already deep.Such thoughts, getting even more heated, went around in my mind.

In more recent news, after several years of diligent investigative work, the United States Federal Bureau of Investigation discovered Julie Dianne Farmer, age 46, of Bakersfield, California USA, and was Crisp & Cole Real Estate’s (CCRE) Chief Operations Officer and managed CCRE’s Business Operations and Business Accounts. She violated her fiduciary responsibilities. It was uncovered that Julie Framer was involved in an extensive mortgage fraud scheme, which ran from January 2004 to September 2007, United States Attorney Benjamin B. Wagner reported.

Together with co-defendants, David Crisp and Carl Cole, Julie Farmer administered and supervised a cold and calculated conspiracy, to swindle residential lenders, who were looking to invest in a house. Julie Farmer, David Crisp, and Carl Cole used straw purchasers, to acquire properties at inflated real estate prices, with funds borrowed from lenders, often using 100 percent financing and based on false and fraudulent loan applications. Straw buying is sometimes used in large purchases, such as buying homes and automobiles, where the real buyer has poor credit and is unable to obtain financing.

The real buyer promises to make all the payments and may compensate the straw buyer for the use of his or her credit. Banks dislike the use of straw buyers because the arrangement increases the risk of default on the loan without the bank’s prior knowledge of that risk. The activity is also risky for straw buyers, who may be held legally responsible for the debt they incurred on behalf of others. Julie Farmer, David Crisp, and Carl Cole–the conspirators, frequently resold the properties, from one straw buyer to another, each time at an inflated price, in order to extract the unsubstantiated gains in equity, from the property, for their benefit.

Eventually, after the defendants failed to make the mortgage payments on time, most of the properties were foreclosed upon. Real estate in California is already so expensive that many new home owners are artificially priced out of buying homes, in their own communities, because investors are snatching up the properties and then renting them out or flipping them, to make more money. Such crimes are not victimless.

The fraud committed at Crisp & Cole Real Estate (CCRE) and by other professionals, prosecuted in our district, made a bad financial environment even worse for our loving communities and hardworking citizens. Many inadvertently think that financial crimes are victimless crimes. However, crimes are not victimless.

The conspirators’ greed ultimately caused irreparable damage to the Sacramento community that sentences or restitution cannot fully repair. Codes of ethics are so important to the Federal Sentencing Guide, a company found to be violating federal law might not by prosecuted if it has the proper ethics policies and procedures.

If you have an active ethics program, in place ahead of time, then bad things should not happen. However, if something does not go as planned, in your corporation, and your have an ethical business, it will not hurt as badly because ethical behavior starts at the top.

The CEO and the other senior managers must set the tone for the people throughout the company. The conspirators’ greed ultimately caused irreparable damage to the Bakersfield community, and the California economy. Julie Farmer was the only defendant who took her case to trial.

On 22 April 2014, a federal jury found Julie Farmer guilty of conspiracy to two counts to commit mail fraud, and two counts to commit wire fraud and bank fraud. Judge O’Neill ordered Julie Farmer to pay $2,914,331.00 in restitution and to forfeit $15,000,000.00 and that punishments or restitution cannot fully repair the damages done as the money may never be paid back.

Judge O’Neill also found that Julie Farmer obstructed justice, by testifying lies at trial, and that she supervised other participants in the conspiracy. Her co-defendants, Carl Cole and David Crisp, pleaded guilty, for their roles, in the scheme, and are both facing 17 months behind bars in a government institution. Other employees, who were found to be involved in the fraud: Caleb Cole was sentenced to five months in prison, and Jennifer Crisp was sentenced to five years’ probation. Jayson Peter Costa was sentenced to six and a half years in prison.

Michael Angelo Munoz received a sentence of two years in prison, and Jeriel Salinas received a 19-month sentence. Sneha Mohammadi is scheduled to be sentenced 14 November 2014. And Robinson Nguyen has already completed his 27-month sentence. Five related cases were brought in 2009 and 2010, against five defendants, also who pleaded guilty to charges relating to this scheme. Jerald Allen Teixeira is scheduled to be sentenced on 9 February 2015. The phnishments for the other defendants are as follows: Megan Balod—36 months’ probation; Christopher Lance Stovall—one year in prison; Kevin Patrick Sluga—20 months in prison; and Leslie Sluga—three years’ probation. A good heart will sometime betray the best head in the World.

Actions speak louder than codes. Once you write a code of ethics and establish an ethics hotline, you have to build trust and encourage employees to be ethical. Nearly 30 percent of all employers reported that they sometimes ignored ethics and even deliberately broke the law. Only 46 percent of employees believe that leaders take responsibility for their actions, most of them blame an intern, new employee, or someone near retirement. Just 45 percent of employees believe that leaders act with fairness, and only 40 percent believe that their employers keep promises. Just to highlight what is going on, take a look at these information, 81 percent of top managers believe that they use ethics in day-to-day decision making, whereas 43 percent of employees believe managers routinely are unethical.

When leaders clearly show profits winning out over trust and ethics, employees become skeptical and mistrustful; these are attitudes that lead to unethical behavior and often times illegal behavior. For example, if you harass a client, for years on end, and then threaten that client, you have broken the law and can be sued and face time in prison. To avoid the lip service trap, support your ethics programs with a dose of reality. Inspire correctly, tell employees how they are personally benefiting from participating in ethics initiatives.

People respond better to personal benefits than company benefits. Acknowledge reality, admit errors, and discuss what went wrong. Solicit employee opinion: what do you think? What is your view? And act on those opinions. Incorporate reality into your solutions: use practical strategies that can be accomplished in the time available. Obtain real feedback by asking employees to name three realities the company is not facing, three reasons the company will not meet its goals, and three competitive weaknesses the company exhibits in the market place.

Be honest; tell employees what you know as well as what you do not. Talk openly about real results, not about what you would like them to be. Accept criticism—and listen to it. Make personal benefits, company errors, and tactical solutions more concrete by being straightforward and specific.

By acknowledging the realities, in every situation, you turn your words into action and build trust with your employees, and senior managers. Questions for employees and employers to consider: How does building trust encourage employees to be more ethical? Some companies ask job candidates to take pre-employment tests such as drug test or lie detector tests. Does such testing build trust with potential employees? Explain.

Determining what is right, in any given situation can be difficult. One approach is to measure each act against certain absolute standards. In the United States, these standards are often grounded in the doctrines, such as Do NOT Lie, Do NOT Steal. Another place to look for ethical guidance is the law. If saying, writing, or doing something is clearly illegal, you have no decision to make; you obey the law.

Golden Rule: Do unto other as you would have them do unto you. Or you might examine your motives: If your intent is honest, the decision is ethical; however, if your intent is to mislead or manipulate, your decision is unethical. You might consider asking yourself a series of questions: Is the decision legal? (Does it break any laws?) Is it balanced? (Is it fair to all concerned?) Can you live with it? (Does it make you feel good about yourself?) Is it feasible? (Will it actually work in the real World?) When you need to determine the ethics of any situation, these questions will get you started.

You may also want to consider the needs of stakeholders, and you may want to investigate one or more philosophical approaches such as those we have discussed. And do at least pretend to be enjoying yourself, even if you are not. Think about the past, when you laughed and someone brought you presents and transformed an ordinary day into something special. As it stands, some people just seem to be fossilized, comforting haze of the morphine and snow falling on London, as if they are in a private hospital or a sanatorium.

The World, much like when Spring comes and the Mistle thrush outside your window begins a fluty song, will slowly come back into focus. An hour a day, walking up and down, in the airing court accompanied by two starched journalist, then only one. These days, I can relate where the antipathy originated—life went on at a steady pace. The shadow casts by the impending economic disaster made the economy grow weaker.

All those months and years of financial murkiness sliding by, one much like the other. And still, despair at the break of another dawn. Each morning, as light gave back shape to the futile World, a star reminder of how much everyone had lost was always being projected through the media, newspapers, TV, magazines, friends, and investors. Again, it is possible to confuse one moment with another.

That it is only with hindsight that our thawing emotions are evident. Or that, having stepped back from the edge the previous term, we can see there has been some significant change in the World. Remember, we rose from the death bed of the recession with certain energy. Outside, you can hear a girl singing a ballot, and the simplicity of the melody has healed your heart and mind. Fling open the shutters of your eyes, and experience the snap of cold air on your arms, and feel, if not precisely happy, then at least not unhappy.