Mark McGrath is a Senior Managing Director at Ankura Consulting Group and is based in Chicago. Mr. McGrath has more than eighteen years of broad based accounting, auditing, investigative and internal controls experience. In addition to extensive consulting expertise, Mr. McGrath’s background includes work as an auditor at international accounting firms as well as internal audit experience at a Fortune 300 company. Mr. McGrath focuses his consulting practice on internal and forensic accounting investigations, SEC enforcement proceedings, revenue recognition issues, Foreign Corrupt Practices Act (FCPA) and anti-corruption reviews, litigation support, auditor malpractice, technical accounting and auditing issues, assessing compliance with regulatory control standards, and internal control remediation. He has worked with outside counsel in representing boards and audit committees in a number of complex, fact-finding accounting investigations involving whistleblower allegations, and SEC enforcement and reporting issues. Mr. McGrath also provides forensic accounting and investigative support in the context of business disputes.
Mr. McGrath’s professional experience includes:
- Bernard L. Madoff Investment Securities – Served as a core member of the global consulting team providing investigative and litigation support to the Trustee and his legal counsel. Worked closely with counsel and led teams of consultants performing forensic investigation, data analysis, and litigation consulting regarding the Ponzi scheme.
- Whistleblower Matter – Assisted outside counsel for the Audit Committee of the Board of Directors to investigate allegations of employee misconduct and fraud surrounding the calculation of allowance for loan and lease losses (ALLL) at a large regional banking corporation. Conducted employee interviews; examined key processes, models and methodologies surrounding the ALLL process and related internal controls; interfaced with the company’s auditors; routinely updated the audit committee regarding the results of investigative procedures; and assisted counsel to identify necessary remedial controls and actions.
- Audit Committee Investigation – Assisted outside counsel for the Audit Committee of the Board of Directors to investigate whistleblower allegations that revenue was improperly recorded in violation of GAAP at a leading veterinary pharmaceutical manufacturer. Examined client financial reporting practices and internal communications to identify ways employees managed earnings, including channel stuffing sales to accelerate revenue recognition, recording revenue on sham transactions, improper recognition of revenue associated with consignment sales and deferring expenses by manipulating reserves and accruals.
- Medical Device Company FCPA Assessment – Assisted outside counsel in an independent review of FCPA compliance at a large public medical device company. Traveled internationally to perform transactional testing and interview employees across Europe and Asia to assess the level of compliance with the FCPA’s Books and Records and Internal Control Provisions. Memorialized and communicated findings to counsel.
- FCPA Investigation – Investigated whistleblower allegations of inappropriate business practices and suspected violations of the FCPA by foreign operating division of a major U.S. diversified technology company. Led initial response team on the ground in Asia to conduct custodial and business process interviews to gain an understanding of system infrastructure, accounting, reporting and recordkeeping practices, and assessed whether allegations were supported in the subsidiary’s recordkeeping.
- Anti-Corruption Consultation for Multinational Private Equity Firm – Led team engaged by outside counsel on behalf of a large multinational private equity firm with real estate investments in Europe to provide privileged consultation and analysis regarding alleged self-dealings and bribes paid by a third party property management service provider to government officials. Assessed the provider’s accounting staff, books and recordkeeping practices and accounting systems for evidence regarding specific allegations or other suspicious payments. Presented results to outside counsel which informed private equity firms investment decisions.
- Rogue Trader Investigation – Retained by counsel to review the facts and circumstances surrounding allegations of rogue trading stemming from an unexpected margin call at a leading national marketer and logistics company for petroleum products. Led team tasked to independently determine the facts surrounding the implementation of a new hedging program, confirm the associated P&L exposures, and identify employees involved or aware of the rogue trading activities.
- Defense of Trustee Bank Stemming from Collapse of Ponzi Scheme – Assisted outside counsel in defense of a large bank against claims brought by a special deputy receiver and state guaranty associations to recover damages approximating $600 million related to the bank’s role as trustee over prearranged funeral assets that were misappropriated by funeral company personnel in the largest Ponzi scheme in Missouri history. Results of work aided outside counsel and bank to negotiate favorable settlement.
- Chinese Reverse Merger GAAS and GAAP Deficiencies – Advised counsel for leading investment management firm regarding GAAS and GAAP deficiencies at an investee company that accessed the U.S. public markets via Chinese reverse merger. Examined financial statements, public domain and applicable authoritative accounting and auditing requirements to identify potential deficiencies and areas to focus litigation. Findings contributed to favorable multimillion dollar settlement with audit firm of investee company.
- Forensic Accounting Surrounding Asset Transfers – Engaged by outside counsel representing a leading provider of innovative medical devices to perform forensic accounting procedures surrounding transfers of assets to foreign jurisdictions made to avoid U.S. judgements through the use of undocumented transfer pricing methods and other accounting anomalies. Large judgement made in favor of client with appeal denied by the U.S. Supreme Court.
- Securities Fraud Defense – Assisted counsel in defense of large hedge fund and its principals against claims of securities fraud and defamation brought by large internet retailer. Examined whether retailer’s change in revenue reporting method was appropriate under GAAP. At the close of fact discovery, the case settled for the cost of the remaining defense.
- Consumer Financial Protection Bureau (CFPB) Readiness Consulting – Engaged by leading retail mortgage lender to assist with various regulatory matters including preparation for initial examination by the CFPB. Supervised team that helped to establish an enterprise-wide risk management (ERM) framework, implement risk control self-assessments throughout the business, evaluate the design and operating effectiveness of key internal controls, prepare written procedure and findings reports and help the company transition towards an in-house internal audit function.
- Internal Control Review for Leading Institutional Investment Manager – Engaged by one of the world’s largest institutional investment managers to perform an operational, ERM and internal control review of third party asset management and mortgage servicing partners to provide additional clarity and comfort to management in response to certain concerns.
- Minnesota Sports Facilities Authority (MSFA) Due Diligence – Assisted outside counsel for the MSFA with investigative and financial due diligence related to a civil judgement involving the Wilf family and its potential impact on their financial contribution to the new Minnesota Vikings stadium. Applied various analytical and substantive procedures and reported results to counsel and members of the MSFA.
- Assist in Defense of President and COO Charged with Fraud – Advised counsel regarding the appropriateness of financial reporting surrounding revenue recognition and sales returns in defense of fraud charges against the president and chief operating officer of a leading sportswear company.
- Audit Partner Defense – Advised counsel regarding the appropriateness of revenue recognition associated with bill-and-hold sales and auditor compliance with GAAS in defense of an improper professional conduct charge against a Big Four audit partner.
- BSA/AML Compliance – Engaged by regional branch of a leading international bank in response to a Matter Requiring Immediate Attention (MRIA) issued by the Federal Reserve Bank regarding the bank’s risk assessment methodology pertaining to the BSA/AML and OFAC Compliance Program. Supervised team that reviewed the risk assessment methodology and identified process, procedure and internal control enhancements and modifications to strengthen compliance with federal regulatory standards.
Mr. McGrath received his Bachelor of Science in Accounting from the University of Maryland, College Park. He is a Certified Public Accountant in the state of Virginia as well as a Certified Fraud Examiner and Certified in Financial Forensics. Mr. McGrath is a member of the American Institute of Certified Public Accountants and Association of Certified Fraud Examiners.