Federal law requires public corporations to keep extensive and accurate records of their financial transactions. Businesses that do not meet these requirements may be required to pay fines of up to $ 1,000,000, and corporate officials could be sentenced to up to ten years in prison. Unfortunately, many innocent business owners or employees are accused of violating federal law even when those people never intended to defraud the government. For this reason, it is critical that those who are under investigation for fraud speak as soon as possible to a white collar crime attorney who can begin working on their behalf.

Financial reports

Under federal law, revenue-generating public companies are required to file periodic reports that contain financial statements. These records must also be accompanied by a written statement from the CEO and CFO attesting that:

  • CEO and CFO reviewed the report
  • To the best of your knowledge, the report does not contain any false statement or omit a material fact in an attempt to mislead;
  • The financial statements, including the data and any discussions of management and analysis of operations, accurately represent the financial position, results of operations and cash flow.

Corporate officials must also certify that:

  • The periodic report fully complies with federal law;
  • The information contained in the report fairly presents the financial situation and results of the company.

Declarations

In addition to certifying the accuracy of the data in the financial report, corporate officials are also responsible for:

  • Establish disclosure controls designed to ensure that the information required for reporting is recorded, processed, summarized, and reported in an accurate and timely manner;
  • Confirm in the quarterly report that they have designed these controls and have evaluated their effectiveness in the last 90 days;
  • Certify that they presented their conclusions on the effectiveness of the program in the report.

The CFO and CEO must also report any deficiencies in the company’s internal controls to their auditors and report any fraudulent activity that involves management.

Possible Penalties

Failure to comply with these requirements can have serious consequences, as even providing a written statement stating that the financial reports are accurate, knowing that the reports are inconsistent with federal law is punishable by a fine of $ 1,000,000 and a prison sentence of ten years.

Certifying that a report itself is correct, knowing that it does not meet federal requirements, is penalized even more severely, with a fine of $ 5,000,000 and imprisonment of up to 20 years. These types of charges are also often accompanied by accusations of other fraudulent activities that can increase a person’s sentence. However, it is important to note that before a corporate official can be convicted under this statute, prosecutors must be able to establish that the respondent knew that the financial statement or report was inaccurate at the time of certification.

Talk to a Miami white collar crime attorney about your case today.

To schedule a free consultation with an experienced white collar crime attorney, call Jeffrey S. Weiner, PA, Criminal Defense Attorneys, at (305) 670-9919 today. Our Miami legal team is ready to assist you immediately.