Criminal Forensic Accounting
Accounting and financial examination of facts under investigation in criminal and administrative sanctioning proceedings, for those who accuse and those who defend.
Overview
The evidence of financial crime lies in the records. It has to be read in full.
In crimes with financial consequences, proof of the offence and the extent of the loss depend on accounting records, bank statements and fund flows. SGEx reconstructs these facts with a verifiable method and works on both sides: for those who investigate or prosecute and for those under investigation or accused.
Two lines of work
Fraud victims, assistant prosecutors and entities that need to prove the facts and the loss.
- Tracing the source and destination of diverted funds.
- Quantifying the loss for restitution purposes.
- Technical support for criminal complaints and for asset freezing and seizure requests.
- Expert questions and technical support in the official examination.
Defence teams that need to test the prosecution’s technical evidence.
- Critical review of official expert reports and financial intelligence reports.
- Showing the source of funds and the operational reason for transactions.
- Recalculating amounts attributed as loss, diversion or evaded tax.
- Expert questions, technical opinion and support at hearings.
The same method, whichever side. Brazil’s Code of Criminal Procedure lets the prosecution, the victim and the defendant submit expert questions and appoint a technical expert (art. 159, §§ 3–5).
Crimes with financial consequences
- Money laundering (Law 9,613/1998). Layers of concealment, front companies and assets inconsistent with income.
- Fraud and swindling (Criminal Code, art. 171). Reconstructing transactions, identifying beneficiaries and quantifying the loss.
- Diversion of capital and misappropriation (Criminal Code, art. 168). Comparing inflows and outflows with the proper use of funds.
- Embezzlement of public funds (Criminal Code, art. 312). Performance of contracts, agreements and transfers and where the funds went.
- Overpricing and procurement fraud (Criminal Code, arts. 337-E to 337-P). Prices, quantities and measurements checked against the contract and the market.
- Bribery and improper payments (Criminal Code, arts. 317 and 333). Payments without consideration, intermediaries and disguised entries.
- Tax crimes (Law 8,137/1990). Determining the tax allegedly evaded and the assessed base.
- Fraudulent management and currency evasion (Law 7,492/1986). Transactions of financial institutions, remittances abroad and off-book records.
- Bankruptcy crimes (Law 11,101/2005). Fraud against creditors, asset diversion and off-book accounting before and during insolvency.
- Capital markets crimes (Law 6,385/1976). Market manipulation and insider trading.
- Pyramid schemes (Law 1,521/1951). Funds raised and paid out, source of returns and destination of contributions.
- Falsified accounting records (Criminal Code, arts. 297–299). Consistency of documents, entries and financial statements with the actual operations.
Proceedings in which SGEx works
At the investigative stage, in court and before administrative bodies.
- Police inquiries (State and Federal Police)
- Public Prosecutor investigations
- Criminal prosecutions, at trial and on appeal
- Asset seizure, attachment and freezing
- Non-prosecution and cooperation agreements
- Sanctioning proceedings (Central Bank, CVM)
- Corporate liability (Law 12,846/2013)
- Tax referrals for criminal purposes
- Audit Courts and special accountability reviews
- Disciplinary proceedings and internal investigations
What We Solve
- Were funds diverted? How much? Quantifying amounts diverted, misappropriated or evaded, period by period.
- Where did the money come from and go? Tracing flows between accounts, companies and related persons.
- Are assets consistent with income? Comparing asset growth, declared income and financial transactions.
- Is there an operational explanation? Comparing the records with the actual activity of the company or individual.
- Does the official report hold up? Reviewing the assumptions, data, calculations and conclusions of the official examination.
- What is the amount of the loss? Determining the loss for restitution, agreements and asset freezing measures.
How We Approach It
Case file and scope
Reading the indictment, the inquiry and the questions to define the examination.
Data
Collecting and verifying the integrity of bank statements and accounting and tax records.
Tracing and testing
Cross-checking flows, entries and documents, with calculation workpapers.
Report or opinion
Conclusions, alternative explanations and limitations set out.
What we examine
Indictments and inquiries, official expert reports, financial intelligence reports, bank statements and data obtained by lifting of bank secrecy, accounting and tax records, contracts, invoices and corporate documents.
Possible Deliverables
The format is defined according to the agreed scope and the purpose of the work.
- Technical accounting report and opinion
- Critical review of official expert reports
- Fund tracing report
- Loss quantification
- Expert questions
- Support at hearings
Other SGEx Solutions
Services, specialties, contexts and industries connected to this topic under SGEx's relationship matrix.
Related Services
- Fraud InvestigationTechnical investigation of financial and accounting irregularities, including fund tracing and the documentation of findings.
- Forensic AccountingReconstruction and examination of accounting records and financial flows for evidentiary purposes, in contexts of suspected wrongdoing, conflict or inquiry.
- Anti-Corruption ComplianceEconomic and financial expert analysis of integrity and anti-corruption matters, focused on quantification and technical evidence.
- Tax Expert ServicesAccounting and tax examination of assessments, credits, tax bases and amounts in dispute in court and administrative proceedings.
- Banking Expert ServicesTechnical examination of contracts, statements and calculations in banking transactions, to determine charges, balances and amounts paid.
Related Specialties
- Forensic Accounting and AuditAccounting reconstruction, tracing of financial flows, analysis of financial statements, contingencies and fraud investigation.
- Damages, Losses and Economic QuantificationLost profits, actual damages, lost revenue, indemnities and the liquidation of court judgments.
- Tax MattersLoss of tax immunities and benefits, enforcement and challenge of tax assessments, contingencies and review of calculations.
- Expert Assistance to PartiesExpert assistance to parties in court-appointed expert examinations and arbitrations: framing expert questions, opinions, review of reports and attendance at proceedings.
- Financial Crime and Money LaunderingAccounting and financial examination of fraud, diversion and misappropriation, and of the path funds took to conceal their origin.
Related Areas of Practice
- Corporate Criminal MattersCriminal proceedings involving companies and their officers in which the evidence turns on accounting and financial analysis.
- Administrative and Regulatory MattersAdministrative proceedings and regulatory disputes with an economic and financial impact on companies and concession holders.
- Courts of Audit and Oversight BodiesProceedings before Courts of Audit, internal-control bodies and other oversight bodies that examine the use of public funds.
- Tax Litigation and Administrative ProceedingsTax controversies in judicial and administrative proceedings that turn on accounting evidence and the review of tax calculations.
Related Industries
- Public Administration and GovernmentPublic contracts, cooperation agreements, concessions and oversight proceedings involving public funds.
- Financial and Capital MarketsFinancial institutions, investment funds, investors and publicly listed companies involved in disputes, valuations and financial reviews.
- Cryptocurrency and Digital AssetsCustody, movement and recordkeeping of crypto-assets in investigations, disputes and asset-tracing engagements.
- Construction, Engineering and InfrastructureConstruction works, engineering projects and infrastructure assets subject to cost, schedule and rebalancing claims.
Talk to our specialists
Describe the proceeding, its current stage and the records available. SGEx handles every inquiry confidentially and will assess the scope before submitting any proposal.