Professor Elam

You Only Go Round Once in Life, Grab for All the Guston you Can

Monday 12/30/2024

Fraud Has Many Faces - Romance Scams

Friday 12/27/2024

Woman loses life savings in romance scam.

Gee another  entry in the how foolish can you be contest!

Nosferatu Is Your Holdiay Ticket to Fear and Trembling

Friday 12/27/2024

Nosferatu is a re make of a 1922 German silent horror film concerning vampires.

Think Dracula.

The link is to an interview with the male and female talent in the film.  Interestingly the male describes this as a holiday film, really a vampire movie?

Indeed it opened in theaters Christmas Day, what next Santa  as a vampire?"

By the way the vampire hunter is Wlliam Dafoe one of my favorites I have not seen in some time.

Socionomic theory holds that negative mood identifies with horror and gangster films. This has its roots in the original Frankenstein and Dracula films of the  1930s.

Public Enemy was a popular gangster film of that era. Horror returns in 11973 with the Exorcist. Gangster films with  Godfather I and II at the same time.

the 1970s were so generally awful it saw the creation of the disaster movie like Poseidon Adventure, the Towering Inferno, and Earthquake.

I have been calling for a market top and considerable sell off, if so Nosferatu is coming in right no time.

Creating Over the Rainbow

12/27/2024

Today's encore selection -- from Listening for America by Rob Kapilow. Arlen and Harburg and Somewhere Over the Rainbow:

"Harold Arlen would collaborate with Yip Harburg on one of the most successful Holly­wood films of all time. A film that by its very nature would fit smoothly into the world of the Hays Code. The quintessential family film: MGM's The Wizard of Oz.

"By the time Arlen and Harburg became part of the Wizard of Oz team, they both had considerable experience with Hollywood, and none of that experi­ence had been particularly unusual or rewarding. Busby Berkeley's extraor­dinary 1933 trifecta of hits -- 42nd Street, Footlight Parade, and Golddiggers of 1933 -- had revived interest in the film musical, and Arlen was one of the many composers hired to fill the renewed demand. For his first picture, Let's Fall in Love (1933), Arlen wrote five songs: two were discarded, two remained in the film, and one was turned into background music. This was a much better result than most. When Rodgers and Hart's musical On Your Toes was turned into a film in 1939, all that survived from the original score were a few songs that had become underscoring.

"The Wizard of Oz, however, was one of the few film musicals of the 1930s in which the music, lyrics, dances, and book were fully integrated into the final film. Though ten screenwriters wrote multiple versions of the script and four directors at different times worked on portions of the film, all of the songs and lyrics were Arlen's and Harburg's. The two were involved with the production from the outset thanks to the influence of Arthur Freed. Though technically only an assistant to producer Mervyn Leroy, Freed made most of the musical decisions for the film, and it was Freed who hired Arlen and Harburg in May 1938 on a fourteen-week con­tract for $25,000. At the time, the script was still in its earliest stages, and the only hired actor was the sixteen-year-old Judy Garland. Film musicals were normally star-driven, and the composer's job was to tailor the songs to fit each star's particular personality and talents. But The Wizard of Oz offered Arlen and Harburg the rare opportunity to write music and shape the story before stars even entered the picture.

"They began with what they called 'the lemon-drop songs' -- the lighter material like 'Ding Dong! The Witch Is Dead' and 'We're Off to See the Wizard ' -- but though these songs came relatively quickly, they struggled with the ballad that would define Dorothy's character and become the film's signature song. 'I felt we needed something with a sweep, a melody with a broad, long line,' Arlen said. 'Time was getting short, I was getting anxious. My feeling was that picture songs need to be lush, and picture songs are hard to write.' Though stories about the inspiration for famous songs tend to be polished over years and years of retellings, according to Arlen, the song came to him out of the blue while he was driving with his wife to a movie at Grauman's Chinese Theater. He immediately stopped the car across from Schwab's drugstore and jotted down the melody. 'It was as if the Lord said, "Well, here it is, now stop worrying about it!"'

"But the song almost didn't make it past Harburg. When he first heard Arlen play it, Harburg thought the song was too old and symphonic for Dorothy's character. Ira Gershwin, however, liked it so much he helped con­vince Harburg, and the song became part of the score. Or so they thought. The studio executives, unfortunately, didn't want it. They thought it slowed down the opening of the picture, was too difficult to sing, and wouldn't sell sheet music or get played on the radio. After the first sneak preview, the studio head, Louis B. Mayer, cut the song for the next preview, at which point an enraged Arthur Freed essentially said, 'Either the song stays or I go.' 'Over the Rainbow' was inserted back into the film, the audience loved it, and the rest, as they say, is history. But what is it that makes this iconic song so great?

"In an interview for Aljean Harmetz's book The Making of the Wizard of Oz, Harburg described his creative process for the opening of the song:

The book had said Kansas was an arid place where not even flowers grew. The only colorful thing Dorothy saw, occasionally, would be the rainbow. I thought that the rainbow could be a bridge from one place to another. A rainbow gave us a visual reason for going to a new land and a reason for changing to color. 'Over the Rainbow Is Where I Want To Be' was my title, the title I gave Harold. A title has to ring a bell, has to blow a couple of Roman candles off. But he gave me a tune with those first two notes. I tried I'll go over the rainbow, Someday over the rainbow. I had difficulty coming to the idea of Somewhere. For a while I thought I would just leave those first two notes out. It was a long time before I came to Somewhere over the rainbow.

"Interestingly enough, the 'bridge from one place to another' that Harburg refers to is already set up beautifully before the song even begins. After Dorothy tries to tell her aunt and uncle about the unfortunate incident between the town spinster Miss Gulch and Dorothy's dog Toto, an annoyed Aunt Em tells Dorothy to 'find yourself a place where you won't get into any trouble.' Though Aunt Em is simply referring to an actual, physical place on the farm where Dorothy won't get into trouble, as Dorothy reflects on this, she turns the real into the metaphorical, saying to Toto, 'Some place where there isn't any trouble. Do you suppose there is such a place, Toto? There must be. It's not a place you can get to by a boat, or a train. It's far, far away. Behind the moon, beyond the rain.' This little scene elegantly creates a 'bridge from one place to another' from the reality of Dorothy's Kansas farm to the world of her imagination, a world that comes to life with the first two notes of 'Over the Rainbow.'

"In a musical language utterly different from the through-composed, non­repetitive style of 'Stormy Weather,' 'Over the Rainbow' has only two melodic ideas in its famous opening. The first I will call 'leap,' and the sec­ond 'circle-and-yearn.' The full-octave leap on 'somewhere' is enormous for the opening of a popular song. It's a leap between two different parts of the voice -- and between two different worlds. The first note is low, almost in chest voice. It's Dorothy's troubled reality -- Kansas, aridity, no flowers, the black and white of the opening of the film. The second note is higher, lighter, and more ethereal. It's 'over the rainbow,' Oz, the place she wants to escape to. The other melodic idea occurs in the second measure, on 'over the rainbow.' It begins on a B, circles back to a B, and then yearns upward to a C. These gestures -- leap and circle and yearn -- are the two key musical ideas of the song."

Prof Dennis Elam on Where Accountants Go

12/25/2024

 

Mark Goldman was the CEO of MGR Accounting Recruiters. He either found a seasoned CPA a new position or he found a CPA for a firm. He began this podcast to

further identify himself with the profession and feature CPAs in Texas and elsewhere.

 

Mark has been a guest on our campus more than once.

His second interview out of  244 was with yours truly.

Click here to listen as Mark interviews the Professor

Joe Biden Pardons Rita Crundwell, Why?

12/15/2024

Biden Pardons Rita Crundwell

The former comptroller of Dixon, Illinois, convicted of embezzling over $53 million from city coffers, was among nearly 1,500 people who had their sentences commuted by President Joe Biden on Thursday.

Rita Crundwell, 71, served a little over eight years in federal prison for the largest municipal theft in U.S. history and was released on Aug. 4, 2021.

Crundwell has been in a halfway house since her release and had a projected release date of Oct. 20, 2029.

More:Sonya Massey's father speaks out on possible release of Grayson: 'This makes absolutely no sense'

It was the largest single-day act of clemency in modern history. The president also issued 39 pardons on Thursday.

Crundwell, who pleaded guilty, was sentenced in 2013 in federal court in Rockford to 19 years and seven months in prison for defrauding taxpayers out of $53.7 million

Crundwell used the funds to secure a lavish lifestyle that included owning champion horses, an 88-acre ranch and a Florida vacation home

Crundwell funneled city funds into a private account over more than two decades.

Dixon is a city of about 14,000 an hour southwest of Rockford.

Dixon City Manager Danny Langloss Jr. said the decision to commute Crundwell's sentence was "a complete travesty of justice and a slap in the face for our entire community."

Bond Denied For INvestment Adviser Willy

12/14/2024

A federal judge has ordered San Antonio investment adviser and financial radio show host Brooklynn Chandler Willy to remain locked up while she’s under indictment for obstruction of justice.

During a Friday court hearing, U.S. Magistrate Judge Elizabeth “Betsy” Chestney said “there was too significant a risk” to release Willy on bond as her lawyer had requested.

Chestney’s ruling drew rousing applause from some of Willy’s clients who have been trying to get back money they’ve invested with her.

Willy, jailed since Tuesday when FBI and IRS agents arrested her at her Stone Oak office following a three-count indictment by a federal grand jury last week, appeared glum after Chestney granted prosecutors’ motion for the investment manager to remain detained. Willy, a 45-year-old Boerne resident, was in shackles and dressed in navy blue prison garb with a white long-sleeve shirt underneath. 

READ MORE: Federal agents arrest San Antonio investment adviser, radio host Brooklynn Chandler Willy at Stone Oak office

Roy Barrera Jr., a San Antonio attorney who represents Willy, expressed disappointment over the judge’s decision.

“Very disappointed for my client,” Barrera said after the hearing. “Very disappointed for my client’s family. We were not expecting this result. We hope to rectify it through our continued negotiations with the government.”

Willy’s husband, parents and two sisters attended the hearing.

Assistant U.S. Attorney Joseph Blackwell had argued for Willy’s detainment because she posed “a danger to the community.”

“This defendant, we know, is a risk to obstruct … a very serious ongoing investigation,” Blackwell told the judge. Willy created a document and falsified clients’ signatures “to try to stymie an investigation into fraud of those very clients,” he said.

“We know that she is a danger to obstruct justice because she has done it,” Blackwell added. “She did it deliberately, she did it multiple times and with multiple victims.”  

SA INC.: Get the week’s top local business stories in your inbox

Chestney said she’s open to revisiting her detention decision after the government takes steps to secure “the evidence, the witnesses, the documents.” She encouraged the lawyers to discuss what a reasonable timeframe for that might be.

Willy was indicted on obstruction and attempt to obstruct a criminal investigation by allegedly producing false documents in response to a federal grand jury subpoena. She’s also been charged with making a false statement and aggravated identity theft.

She owns Queen B Advisors LLC, which does business as Texas Financial Advisory, an asset management and financial planning firm. In August, Texas Financial Advisory reported managing more than $117 million in assets on behalf of about 620 clients.

She has hosted a radio program on Saturday evenings and Sunday mornings on WOAI-AM and Sunday afternoons on KTSA-AM and KTSA-FM. WOAI, however, removed the show from its online program schedule following Willy’s arrest. WOAI and KTSA officials didn’t respond to an email inquiring if they will continue to air her show. Neither news station has anything about her arrest on their websites.

Meanwhile, Willy is a defendant in at least three lawsuits — including one involving 71 plaintiffs who allege she committed fraud and violated state securities laws by selling unregistered securities. She has disputed the allegations.

In November 2023, the FBI and IRS launched a criminal investigation into an investor fraud scheme allegedly involving Willy and a Lubbock investment company, identified in the indictment as “Company 1.” 

During the hearing, Rebecca Jones, an IRS special agent in criminal investigation, testified the company is Lubbock-based Ferrum Capital LLC. The FBI and IRS’ investigation involves a “much larger investment fraud scheme” with at least 400 victims, she said.

“Losses are in the tens of millions,” Jones said. 

Clients were sold Ferrum investment products that included distressed debt, life settlements and European bonds, she said. Willy put about 200 of her clients into those products, Jones added. 

 

The investigation has two prongs. The first involves “fraud in the inducement of the investment,” such as lies told to clients about the risk and security of the products, Jones said. The second prong involves “money that was just flat-out stolen from victims.” That included money that went to other investors, making it a Ponzi scheme, she said.

San Antonio couple

Jones testified about an elderly San Antonio couple who agreed to invest $500,000 with Ferrum using Willy’s Chandler Capital Holdings as the agent to execute and deliver the contract. The two, who made the investment in 2021, are identified in the indictment as “Victim 1” and “Victim 2.”

Willy deposited the couple’s check with Chandler Capital but never sent any of the money to Ferrum, Jones said.

Willy used the money to pay her American Express bills, to pay herself, to pay one of her other businesses and to pay back other clients, Jones said. 

 

On June 11, the couple agreed to have a “monitored” phone call with Willy. Blackwell played the entire 18-minute call for the judge.

“Just to put you on the spot, you didn’t take any of our money?” the husband is heard saying to Willy.

“No, I did not,” she answered.

“Well, I’m just in a tough spot here because this represents 17 years of savings,” he said. 

The ‘loan’

Willy produced for investigators a revolving line of credit agreement and promissory note reflecting that the couple’s company had loaned $500,000 to Willy, Jones said. That would explain Willy’s personal use of the money, the agent added.

However, the couple told investigators they had never seen the document or signed it. Nevertheless, it appeared to have their signatures, Jones said. The couple also said they never would have agreed to such a loan, she added.

Jones testified the couple’s original investment agreement was executed in May 2021, but the creation date of the credit agreement and promissory note in electronic form was Sept. 18, 2024 — “the due date of the subpoena.”

The couple’s signatures on the agreement and note appeared identical to their signatures on a 2018 document, Jones said. They were sent to an FBI lab for analysis. 

The lab determined they were “duplicate signatures,” Jones said. “They were completely identical.”

Jones later said, “Mrs. Willy has a lot of power over her clients’ life savings. We’re concerned that Mrs. Willy may use this power to influence, intimidate or lie to clients to get  them to not cooperate with our investigation.”

If convicted, she could face up to 20 years in prison on the obstruction charge. Making a false statement carries a prison sentence of up to five years, while identity theft is a minimum of two years in prison — to run consecutively with any other sentence. Each charge also carries a maximum penalty of $250,000.

 

 

 

 

 

Dec 13, 2024

Chris OPettit Owes $106.3 M in Restitution

12/13/20224

 

 

Jailed ex-San Antonio lawyer Chris Pettit will owe $106.3 million in restitution to nearly 100 victims under a court order U.S. District Judge Orlando Garcia is expected to sign next week.

At a court hearing Thursday, Garcia said he would adopt federal prosecutors’ recommendation that Pettit pay back 98 former clients who, in some cases, lost their life savings as a result of the massive fraud orchestrated through his law firm for years. The restitution amount each victim is owed is filed under seal with the court.

The judge agreed to the amount despite an objection from Pettit’s court-appointed public defender, Alfredo Villarreal, who argued prosecutors’ calculation of what should be owed “lacks accuracy, certainty (and) precisioness.”

“We object to the court ordering restitution in this matter on the specific grounds that the government has failed to meet its burden to prove that each and every dollar of the restitution award … is justified under the Mandatory Victims Restitution Act,” Villarreal said. Garcia overruled the objection.

Pettit, 57, attended the hearing dressed in prison garb and restrained in shackles but did not speak.

READ MORE: Chis Pettit and his defunct law firm’s bankruptcies wind down as assets are sold, litigation unfolds

He was a longtime probate, estate planning and personal injury lawyer who pleaded guilty to three counts each of wire fraud and money laundering related to the theft of millions of dollars from his clients. 

In February, Garcia sentenced Pettit to 50 years in federal prison — about twice the time recommended by sentencing guidelines.

ettit has filed an appeal of his conviction and sentence but it’s been on hold pending the outcome of the restitution hearing. In an August filing, a lawyer for Pettit said she anticipated he would also appeal the restitution amount.

As part of his plea agreement, Pettit admitted the loss amount was in the range of $20 million to $65 million.

Garcia’s decision to award restitution, though, is largely symbolic. His victims don’t expect Pettit will ever pay any of what he stole.

Attorney David McQuade Leibowitz, who represents about 130 victims suing banks that did business with Pettit, called “truly tragic.”

“My clients have an ice cube’s chance in hell of ever receiving any restitution money,” he said before the hearing.

 

PETTIT TIMELINE: From ‘friend’ and ‘family confidant’ to jailed fraudster, the case of ex-attorney Chris Pettit

Assistant U.S. Attorney Kelly Stephenson said as much during the hearing.

“I sincerely wish that there was a pot of money hidden somewhere,” he told the judge. “We have no reason to believe there is a pot of money hidden anywhere. Obviously, that is the type of thing we look for in our investigation.”

The lack of funds prompted a question from Garcia.

“Where does one go out and spend $106 million?” he asked the prosecutor.

 

Stephenson reminded the judge that prosecutors had provided details during the punishment phase of the sentencing of Pettit’s lavish spending, including millions of dollars on real estate. Pettit also collected “very expensive, very fine things” to decorate his house, including a life-size Storm Trooper figure from the “Star Wars” films.

“He was spending money in lavish, kind of over-the-top ridiculous ways,” Stephenson said.

He defended prosecutors’ efforts to accurately calculate victims’ losses, work that included going through bank records for accounts controlled by Pettit or his firm.

After his schemes were exposed in the spring of 2022, Pettit surrendered his law license, shuttered his firm and filed bankruptcy for himself and the firm. His victims have recovered little through bankruptcy proceedings and many now are pinning their hopes of some recovery through litigation with the banks.

 

Earlier this year, Chief U.S. Bankruptcy Judge Craig Gargotta cautioned Pettit’s victims that even though they were pursuing three different tracks to recover their money — restitution, bankruptcy and litigation — they can only get “one recovery.”

 

 

 

 

 

Dec 12, 2024

SA FInancial Advisor Arrested

Friday Dec 13, 2024

Embattled San Antonio investment adviser and financial radio show host Brooklynn Chandler Willy remained behind bars Wednesday after being arrested by IRS agents at her Stone Oak office.

The arrest Tuesday came six days after a federal grand jury indicted her on three charges including obstruction of justice and aggravated identity theft. It’s the latest in a string of legal and regulatory trouble she’s faced in recent years.

Willy, restrained in shackles, made an initial court appearance Tuesday afternoon. U.S. Magistrate Judge Elizabeth “Betsy” Chestney set a detention hearing for Friday to determine whether Willy, 45, can be released on bond. 

Chestney said prosecutors asked that she remain in custody because she poses a “substantial risk for obstructing justice.”

San Antonio attorney Roy Barrera Jr., who represents Willy, declined to address the charges against her other than to say they would be dealt with in court at the appropriate time.

“This is obviously an extreme shock to her (and) her family and we’re going to do everything we can to represent her to the best of our ability,” he said after the hearing. “We’re hoping for the best.”

READ MORE: Fraud claims mount against San Antonio investment adviser Brooklynn Willy, her firm and others

According to the indictment, which was unsealed late Tuesday afternoon, the FBI and IRS began a criminal investigation in November 2023 into an investor fraud scheme involving Willy. A federal grand jury has issued subpoenas as part of the investigation, which is ongoing. The investigation started less than 10 days after the San Antonio Express-News reported on multiple lawsuits against her.

 

Willy, owner of Queen B Advisors LLC, which does business as Texas Financial Advisory, is charged with impeding the federal grand jury proceeding by providing a false revolving line of credit agreement in response to a subpoena.

She told federal agents that a revolving line of agreement to her for $500,000 had been signed by two individuals identified as “Victim 1” and “Victim 2”, the indictment says. The two never entered into the agreement, the charging document says. Willy is charged with forging their signatures on the credit agreement and promissory note.

If convicted, she could face up to 20 years in prison on the obstruction charge. Making a false statement carries a prison sentence of up to five years, while identity theft is a minimum of two years in prison — to run consecutively with any other sentence. Each charge also carries a maximum penalty of $250,000.

Willy already is facing at least three civil lawsuits by former clients who accuse her of various wrongdoing. In one of the suits, 71 plaintiffs have alleged she violated state securities laws, breached her fiduciary duties and committed fraud.

A lawyer representing her in that ligation previously said the allegations were “unfair” and would be fought.

 

Willy appears on the radio Saturday evenings and Sunday mornings on WOAI-AM and Sunday afternoons on KTSA-AM and KTSA-FM offering financial advice to listeners.

Four years ago, she landed in the crosshairs of the Texas State Securities Board for engaging in the sale of “alternative investments” without being registered as a securities dealer or an agent of a dealer. That activity cost her her job. 

As part of the state’s disciplinary order, she agreed to a one-year suspension of her license as an investment adviser and to pay back almost $2.8 million in commissions she received from the sale of the alternative investments.

She forged many clients’ signatures on a document purportedly “waiving” their right to receive a commission refund as ordered by the state, according to the lawsuit filed by 71 plaintiffs.

She also is is accused in the suit of pitching “risky, unregistered investment contracts” by various businesses, including Lubbock-based Ferrum Capital LLC. Some of the investors’ money was used to fund loans to Austin debt collection agency Collins Asset Group LLC to buy distressed accounts receivable, also known as bad debt, the suit says.

 

Willy assured clients their investments were “safe” and profits “guaranteed,” the suit says. In reality, Ferrum was a “Ponzi scheme” and it’s unlikely investors will get their money back.

“There are $20 million worth of Willy customers who very much want to know why they sold them Ferrum notes,” said Shari Pulman, an attorney who represents the 71 plaintiffs.

 

 

 

 

 

 

 

KPMG CEO Speaks Out On CPA Deficit

Wed 12/11/2024

According to a United Nations estimate, 230 languages went extinct between 1950 and 2010. If my profession doesn’t act, the language of business—accounting—could vanish too.

The number of students who took the exam to become certified public accountants in 2022 hit a 17-year low. From 2020 to 2022, bachelor’s degrees in accounting dropped 7.8% after steady declines since 2018.

While the shortage isn’t yet an issue for the country’s largest firms, it’s beginning to affect our economy and capital markets. In the first half of 2024, nearly 600 U.S.-listed companies reported material weaknesses related to personnel. S&P Global analysts last year warned that many municipalities were at risk of having their credit ratings downgraded or withdrawn due to delayed financial disclosures.

Our profession must remove hurdles to learning the accounting language while preserving quality. In October, KPMG became the first large accounting firm to advocate developing alternate paths to CPA licensing. We want pathways that emphasize experience, not academic credits, after college.

Most people today must earn 30 credits after their bachelor’s degrees—the so-called 150-hour rule—work under a licensed CPA for a year, and pass the CPA exam to become licensed. Research by the Center for Audit Quality finds that the 150-hour rule is among the top reasons people don’t pursue CPA licensure. A December 2023 study found that the requirement causes a 26% drop in interest among minorities.

There is a consensus for change, but we can’t waste time. Many state CPA societies are working on legislation to create an alternative path to licensure. State boards of accountancy should replace the extra academic requirement with more on-the-job experience. A person who is licensed in one state should be able to practice in another even if reforms create different licensing requirements.

Yet reforms alone won’t solve the workforce shortage. Our profession also needs to address at least three misconceptions:

First, many prospective accountants worry that their pay will be insufficient. That isn’t our experience, especially amid labor shortages, when salaries tend to rise. At KPMG, starting salaries have increased at nearly double the rate of inflation over the past three years. Our competitors are also raising salaries, creating a bidding war for talent.

Second, some believe accounting is boring. My 40-year career as a CPA has been anything but. No profession goes deeper into understanding the nature, risks and opportunities of an industry than public accounting. Accountants have a courtside seat, with behind-the-scenes access, to a business landscape constantly changing thanks to globalization, artificial intelligence, climate change, cyber security, and more.

Finally, many don’t appreciate that the profession can open doors to a variety of careers. CPAs aren’t stuck at their desks. There’s a reason Phil Knight hired so many accountants in Nike’s early days and the Federal Bureau of Investigation recruits them as financial investigators. Their skills place them at the intersection of strategy and execution across top issues facing the C-Suite.

Our profession must ensure that the next generation considers accounting a rewarding career. If we don’t, the language of business may meet an untimely end.

Mr. Knopp is CEO of KPMG US.