Harriette Walters
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Harriette Walters a former civil servant who worked as a tax assessments manager for the District of Columbia. She was convicted of being the central participant in the largest fraud scheme ever perpetrated by a District of Columbia government official. According to those officials, she worked with others to fraudulently approve over $31 million in improper tax refunds, with some estimates nearing $50 million. In her office, she was referred to as "Mother Walters" for the loans and extravagant gifts with which she would shower her fellow employees and friends. Walters was arrested in November 2007. From the Washington Examiner (June 30, 2009): 'Self-confessed tax scam mastermind Harriette Walters was led off to prison Tuesday, but not before warning a federal judge that the District's finance office is still dangerously exposed to another massive rip-off.
"If you let me into my office, I guarantee I could get each of you a check." Walters told prosecutors and federal Judge Emmet Sullivan before he sentenced her to 17-and-a-half years in prison.'
The fraud scheme of Harriette Walters has been the subject of academic and professional publications. Jacoby, Loringo, and McCallum describe the mechanics of the fraud scheme together with some informative analytics looking at the amounts over time. The authors then review the importance of internal controls and also review the control activity deficiencies that allowed the proceeds of the fraud scheme to exceed $48 million.[1] Nigrini reviews the overuse of round numbers in various fraud schemes and also their overuse in the examples used in accounting textbooks. The overuse of round numbers in the fraud scheme is documented. He speculates that newly-minted auditors miss the red flags thrown by round numbers in client data because of their overuse in accounting textbooks.[2] In Forensic Analytics Second Edition Nigrini devotes an entire chapter to the fraud scheme of Harriette Walters. The $49.3 million fraud scheme is described and various analytics-based tests are run on the 239 transactions over the 18-year duration of the scheme. An appendix to the chapter lists the dates, the payees, and the amounts of the fraudulent refunds. The chapter includes a note on another fraud scheme in the same Office of Tax Revenue that overlapped with the arrest and sentencing of Harriette Walters.[3]
According to the Federal Bureau of Prisons, Harriette is scheduled for release on October 6, 2022,[4] but their records show that Harriette Walters is currently under the jurisdiction of a Residential Reentry Management office in Baltimore.
References
- ^ Jacoby, Philip; Loringo, Sebastian; McCallum, Brent (2011). "Fraudulent Tax Refunds: The Notorious Career of Harriette Walters". Current Issues in Auditing. 5 (1): A23–A38. doi:10.2308/ciia.2011.5.1.A23.
- ^ Nigrini, Mark J. (2016). "The Implications of the Similarity Between Fraud Numbers and the Numbers in Financial Accounting Textbooks and Test Banks". Journal of Forensic Accounting Research. 1 (1): A1–A26. doi:10.2308/jfar-51465.
- ^ Mark J. Nigrini (May 2020). Forensic Analytics: Methods and Techniques for Forensic Accounting Investigations (Second Edition). Hoboken, NJ: John Wiley & Sons Inc. ISBN 978-1-119-58576-3. Retrieved 31 May 2020.
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