Forensic Accountants Nail Philadelphia's Fumo: A True Case of Forensic Accounting

• In Event: Forensic and Investigative Accounting

Abstract

Recently, Pennsylvania State Senator Vincent Fumo, who represented a district in Philadelphia and was one of the most powerful politicians in the state, was convicted of a $4 million fraud. Senator Fumo was a fixture in Philadelphia, living there all his life and representing South Philadelphia’s 1st Senatorial District for 30 years. It took forensic accountants from the FBI over five years to investigate the fraud and build evidence for the court case. The forensic accountants had to wade through credit card bills, store receipts, toll slips, canceled checks, invoices, etc. Databases had to be constructed to organize the records of thousands of fraudulent purchases. Numerous uncooperative parties had to be interviewed.
Fraud has become an extremely important topic in recent years due to high profile accounting scandals and the passage of the Sarbanes-Oxley Act. Frauds typically increase during recessions, so in our current economy, it is more important now than ever before to educate current and future accountants on fraud prevention, detection, and prosecution. This case traces an actual fraud from beginning to end and details how it occurred and why it went undetected for so long, as well as how it was eventually detected. The case should be of interest to both academics and practitioners.

Authors

• Barbara Vinciguerra, Moravian College

• Maria H Sanchez, Rider University