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wickes fraud scandal

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Introduction

Issues in Accounting and Finance Wickes Scandal The purpose of this report is to critically analyse the insight of the scandal, which occurred in Wickes during 1996 and also discuss whether the scandal was preventable. Wickes was first established in Manchester 1972 when it was launched as a joint venture between the US group, Wickes Corporation and another UK Building merchant. They are the leading UK Company of DIY merchants focusing on raw materials and suppliers for public and trade. Wickes was a fast growing company until a fraud scandal took place associated with its employees. The fraud scandal was investigated by serious fraud officers along with the cooperation of the Metropolitan police. This fraud scandal was committed by four previous directors of DIY wholesalers and building merchants with the names of Trefor Llewellyn, Geoffrey Battersby, Terrence Carson and Leslie Rosenthal. Furthermore, it was found that a fifth person called Henry Sweetbaum was also involved. He was an ex-chairman and chief executive of the organisation. The charge which five individuals committed had a connection with an accounting scandal because they produced false statements and false dealing of products in relation to the business. ...read more.

Middle

http://www.telegraph.co.uk/htmlContent.jhtml?html=/archive/1996/10/17/cwick17.html All the three defendants were found not guilty on all the accusations which were charged on them The other two defendants, Geoffrey Battersby and Leslie Rosenthal who was also associated with the fraud scandal were questioned through out the early months of the trial followed with the corporation of the other three defendants. Geoffrey Battersby was released free due to there was no case to answer so therefore the judge directed the jury to return to a not guilty verdict. Leslie Rosenthal would have to return to court next year faced by another jury as this jury was acquit from delivering a verdict due to legal reasons. The company was a well growing established retailer industry in the market, how ever due to the scandal charges against Wickes. This caused a lot damage to company itself, it gave Wickes a bad status in the market and also they were black listed which meant that the company had a poor financial history so therefore in the future they will be refused on credit products and any other kind of financial circumstances. On the same day the company got black listed which was on the 25th June 1996, the announcement of the scandal was exposed to the public. ...read more.

Conclusion

They could do this by producing a code of ethics which all the employees will have to fallow and can not be broken. Therefore the company will have strict rules and have control over their employees. This will help the business to be safe and prevent employee misbehaviour. An additional idea is to direct different position to different individuals; Henry Sweetbaum was the company's former chairman and chief executive. So therefore Wickes could have given two individuals them to positions instead of just giving it to one individual. If they were two individuals directed for them positions then they would have had an inter link with one another jobs and would have been aware of what each one is undertaking. So therefore I personally think that the incident of the scandal would have occurred earlier than later if the former chairman and chief executive roles were given to two individual instead of just one. In conclusion I personally think that the fraud scandal which arose in 1996 for Wickes was a huge turn around for the company and now due to this incident they will be more careful now in the future. Wickes will be more alert and aware of how to minimise the risks and the prospect which occur in a scandal. Referencing http://www.telegraph.co.uk/htmlContent.jhtml?html=/archive/1996/10/17/cwick17.html ...read more.

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