A former Grant Thornton partner has been arrested for stealing nearly $4 million in client payments intended for the firm.
Craig B. Haber was arrested by postal inspectors Wednesday morning at his residence in New York City and appeared before a judge in Manhattan federal court that afternoon.
The 59-year-old accountant was a partner at Grant Thornton from 1993 until last July, working at the firm’s offices in Manhattan providing tax preparation and advisory services to investment partnerships and other clients. Grant Thornton’s bills ordinarily included payment instructions directing clients to pay the firm by wire transfer or by sending checks to GT’s headquarters in Chicago. However, on multiple occasions from 2004 through July 2012, Haber allegedly sent bills to clients containing payment instructions directing them to send checks to him at the firm’s New York office instead of the Chicago headquarters.
Upon receiving those checks, Haber allegedly deposited a number of them into a bank account that he had opened in the name of a sham business that was very similar to Grant Thornton’s name. He opened the bank account specifically to receive checks from clients that were intended for the firm, according to prosecutors. After depositing the clients’ checks into that account, he then allegedly transferred the money from that account to two personal bank accounts which he used to pay various personal expenses, including mortgage payments for his Manhattan residence. Haber allegedly stole a total of nearly $4 million in client payments.
“From his perch at a prestigious accounting firm, Craig Haber allegedly betrayed his partners, by deceiving the firm’s clients in order to rob the firm blind—diverting millions of dollars of client payments into his own pocket,” Manhattan U.S. Attorney Preet Bharara said in a statement. “Fraud is always serious, but it is especially alarming when, as alleged here, it is committed by professionals who are supposed to be gatekeepers responsible for ensuring financial rectitude.”
Haber has been charged with one count of mail fraud, and faces up to 20 years in prison and a maximum fine of $250,000, or twice the gross gain or gross loss from the offense.
Grant Thornton said it copperated with the investigation. "A former partner of Grant Thornton was arrested today by law enforcement authorities in New York for allegedly stealing from Grant Thornton," said spokesman Tim Blair. "Grant Thornton disclosed this former partner’s conduct to the authorities promptly after discovering possible financial improprieties, which resulted in his separation from the firm. The firm fully cooperated with law enforcement authorities in their investigation and will continue to cooperate in their prosecution of this matter."
13 Comments
The question becomes, what happened to GT's internal control? Somewhat embarrassing when you provide consultation in the same area!
Posted by: pmcintyre | March 29, 2013 9:03 PM
Report this Comment
What a silly thing to do. GT ex-partner ought to have realised that his misappropriation of client fee remittances would be easily caught sooner than later. I would have thought that a partner level person is well grinded by training not to do any frauds!
Posted by: varma1002003 | February 14, 2013 7:36 AM
Report this Comment
I hope he likes his new boy friend in prison!
Posted by: JeffChaidez@gmail.com | February 8, 2013 2:03 AM
Report this Comment
CPA are supposed to be the most honest Tax Preparers we have. That just goes to show you that you reap what you sole. The IRS can identified all bad preparers just using the EFIN number. The EFIN number standards should be a lot higher !!! ITS THE EFILE SYSTEM PEOPLE !!!! A two year old moron can do most tax returns. However criminals with turbo tax are killing the IRS.. LOL Yet they wanted to make the poor little Tax Preparer the scapegoat.
This story proves that there are no prefect people in the tax business.. lol
Posted by: JDAVIS | February 7, 2013 4:36 PM
Report this Comment
Kind of makes you wonder about the vetting process used before someone is offered a partnership opportunity. Never thought of the word prestigious and Grant Thornton in the same sentence though.
Next we'll probably learn he was a frequent visitor to Atlantic City or Vegas where he was just another wannabe big shot.
If any of the "side bills" went to an audit client, it should have been pretty easy to spot. If not, I can see how it could escape detection. But this guy must have been really busy to get in his chargeable bogey, while generating the additional income the partnership agreement probably required.
At least he won't have to worry about having the funds set aside to retire. First the lawyers will get theirs, then we will pay for his retirement.
Posted by: topbeancounter | February 7, 2013 1:05 PM
Report this Comment
Aghast? Amazed?
C'mon, Are all you CPA's so naive? This has been going down with far more frequency than robbing gas stations or Quik-Stop stores. Accountant Folks just do a slicker version of Smash and Grab.
Collusion? 90% Copycats? 60% Solution? State Prison Time, no Fed Golf Course Prisons, and 1 day guaranteed time for every 1 dollar stolen--zero plea bargains.
See, White-Collar Crime Does Time with No-Collar. Such Accountants are just different smelling purse snatchers, making us all victims.
Posted by: nostromo49 | February 7, 2013 12:24 PM
Report this Comment
the letters he had after his name has nothing to do with this.
this can happen to any firm that isn't diligent in it's constant review of an accounting system and bank receipts.
what is equally troubling is that the bank allowed him to set up an account in the firm's name (or something "similar"?) with only one authorized signer. they should have known better. and they should have also known a company of that size would be depositing a lot more money than it did.
if it took that many years to determine a shortage, then there was failure on the part of many of those involved. and apparently $4million to Grant Thornton isn't that important.
Posted by: cpandy | February 7, 2013 10:54 AM
Report this Comment
jbtatum Would you like to see more multimillion dollar swindles by CPA's so that you could feel even sweeter. Poor attitude and obvious chip on your shoulder.
Thieves come in all shapes colors and educational backgrounds. The RTRP requirements were meant more for educational and accountability purposes.
In any city there are corner one stop shops that do travel, real estate and "oh by the way" we do taxes too. This is what the proposal was meant for.
In either case have a good tax season.
Posted by: RUSSELL G | February 7, 2013 10:53 AM
Report this Comment
hnieto: I think the billings were done by the partner and never recorded on the firm's books. In other words, these were probably "side" billings, over and above the firm billings.
Posted by: leslied | February 7, 2013 10:26 AM
Report this Comment
My, my, my...and what letters did he have after his name? Just goes to show thievery is thievery regardless of your education, experience, credentials, multiple hours of ethics cpe, etc. I hate to see dishonesty in the business but the irony, especially now with all the uproar over the RTRP requirements, is sweet.
Posted by: jbetatum | February 7, 2013 10:18 AM
Report this Comment
That is a very good question, gapp. The Internal Controls just were nowhere to be found.
Posted by: BJohnson19 | February 7, 2013 9:35 AM
Report this Comment
There is more to this and i'm sure someone else was involved with him from the firm. just think, $4MM of receivables significantly aged or not collected??? these guys are accountants and i'm sure they look at that. its common sense. COLLUSION ANYONE???
Posted by: hnieto | February 7, 2013 8:39 AM
Report this Comment
Where were their internal controls?????
Posted by: gapp | February 7, 2013 8:24 AM
Report this Comment
Add Your Comments...
Already Registered?
If you have already registered to Accounting Today, please use the form below to login. When completed you will immeditely be directed to post a comment.
Not Registered?
You must be registered to post a comment.