A Case of Fraudulent Business Acts, Case Study Example

Data-keeping is an important aspect for both established and still-starting organizations. It could be realized that somehow, this particular operation aims to make sure that the information shared by the organization to its partners and its clients are accurately recorded and kept well for future references. For business organizations operating online like AOL and PurchasePro, keeping data of their transactions especially that of their sales revenues serve as a distinct foundation of the said organizations’ reputation both in the field of ecommerce operations and the way they deal with their clients and other stakeholders in the level of personal connection.

The connection between AOL and PurchasePro was considered malicious [if not anomalous] due to the information presented to the public regarding their statement of revenues during the year 2001. They were investigated on presenting at least a 37% of overstatement from the actual revenues of the company [PurchasePro] during the said year. It was said that AOL colluded with such process through overstating the rate of software licenses that they have sold to the company which would likely reflect a higher revenue for PurchasePro. As a result, investors trusted the statement and decided to invest in the business only to find out that the organization [PurchasePro] is not able to withhold the supposed process of revenue that it is supposed to provide its stockholders with.

The settlement amount of $210 million fine paid by AOL allowed the accused members of the organization to avoid criminal persecution, nevertheless, this should not hold them specifically safe from litigation in relation to how they handle business reputation and integrity in relation to how they complete their operations for their clients and their stakeholders accordingly. John Tuti and Kent Wakeford from AOL and Christopher Benyo from PurchasePro were accused accordingly of such fraudulent handling of data. However, Tule and Wakeford were acquitted later on during the trial sessions. It was hard for the investigative team to put the situation into the hands of the accused individuals as even though the evidences were supposedly strong, it was obvious how the data collected were not enough to establish their guilt on the said fraudulent act.

Likely, it could have been better if the investigations were able to undergo investigative procedures relating to steganography or the process of hiding data within a particular file where the actual data is established as a phantom data that is kept from visibility of investigators and the unlikely users of the system. This way, the investigators might have been able to particularly identify what specific information is kept within the hard disk [physical disk] of the servers of AOL and/or the virtual hard drive used by the organization to connect with its affiliates. Hidden data within streams, signals and phantom hard drives specifically create a distinct impact on how the aspect of record keeping is manipulated by administrators. Likely, it could be realized that the involvement of computer forensics experts could actually help fully in finding such hidden data. On the other end, computer program developers and specialists could also provide extensive assistance in making sure that there are no hidden locations for particular data stored by the administrators of the organization. Tuli and Wakeford could have been investigated upon relatively alongside their personal computers also with that of the servers used by the said individuals in the company. In case they are actually using a specific data location that is hidden from the actual data locations used by the company and the personnel being accused of the said fraudulent act.

The utilization of investigative operations relating to spoofing, masking and redirecting actions handled by internet users when they want to cover their paths of operations especially in relation to the context of the case being investigated upon could bring about vital information that could pinpoint the connection of Tuli and Wakeford in the situation. Through this approach, the traffic sent through the websites of both companies involved could be measured accordingly. If in case there are unrecorded or masked activities that are measured through the traffic data, the investigators could start on the point to note if there were particular data exchanged within the said paths that were determined during the analysis of data traffic exchange record.

Utilizing website features such as whois, nslookup and traceroute, the investigators would be able to understand the basic foundation of the activities and trace whoever among the users [through their identifiable IP addresses] are actually exchanging wrong information to manipulate the data of the revenues that the companies record into the system hence creating a huge distinction on how the sales rate are being recorded to present a higher rate than the actual transactions that are completed between AOL and PurchasePro during the year 2001. Anomalies could be further examined through the assistance of accounting experts who have better command in identifying wrong entries into the statements presented by the organizations involved.

Based from this particular case, it could be realized that organizations at present are able to fraudulently report their revenues statements even when they are operating online and are supposedly presenting flawless reports for the sake of the protection of their investors and stockholders. AOL and PurchasePro’s case could or could not involve specific data hiding operations to be able to manipulate financial statements that they presented to the public. Whether or not this is true, practical investigations from the specialists would actually help in the process of litigation and clarification of the involvement of key individuals in the case.

References

Bierbrauer, Jürgen; Fridrich, Jessica. (2001). “Constructing good covering codes for applications in Steganography”. Transactions on Data Hiding and Multimedia Security III. Lecture Notes in Computer Science (Springer Berlin Heidelberg).

Kharrazi, Mehdi; Sencar, Husrev T.; Memon, Nasir. (2001).”Performance study of common image steganography and steganalysis techniques”. Journal of Electronic Imaging 15 (4).

Provos, Niels; Honeyman, Peter. (2003)”Hide and Seek: An Introduction to Steganography“. IEEE Security & Privacy (IEEE Computer Society) 1 (3): 32–44.

Provos, Niels. (2004). “Defending against statistical steganalysis”. Proceedings of the 10th conference on USENIX Security Symposium. SSYM’01 (USENIX Association) 10: 24–37.

US Department of Justice. Investigations Involving the Internet and Computer Networks. https://www.ncjrs.gov/pdffiles1/nij/210798.pdf. (Retrieved on December 2, 2013).