The Jaguars’ $22 million question: How did four years of theft go undetected? (nfl)

The Athletic ^ | 12-12-23 | Katie Strang and Kalyn Kahler

[dynachrome]

How could this happen?

That question swept through the offices of NFL teams last week after The Athletic broke the news that Amit Patel, 31, a former employee in the finance department of the Jacksonville Jaguars, allegedly stole more than $22 million from the team over a four-year period.

Patel was a mid-level employee who worked for the Jaguars from 2018-23. He allegedly created fraudulent charges on the club’s virtual credit card and then covered his tracks by sending falsified files to the team’s accounting department. According to a charging document, he used that money to buy vehicles, a condominium and a designer watch worth over $95,000. He also purchased cryptocurrency, splurged on luxury travel for himself and others and used the funds to keep a criminal defense lawyer on retainer. Patel’s attorney said that the vast majority of the $22 million he stole were gambling losses; Patel allegedly placed bets on football and daily fantasy sports with online gambling sites.

[discostu]

Well he got caught. So obviously he didn’t successfully hide it. WorldCom and Enron got caught by going huge. I mean their fraud was multiple of their companies’ worth.

Materiality still matters. Nothing Congress passed changed that. It’s still part of GAAP, and still recognized by the SEC.

Oh here check this out, poking around materiality:
https://en.wikipedia.org/wiki/Materiality_(auditing)
Methods from Discussion Paper 6: Audit Risk and Materiality, as issued in July 1984

These methods offer a suggested range for the calculation of materiality. Based on the audit risk, the auditor will select a value inside this range.[15][failed verification]

0.5% to 1% of gross revenue;
1% to 2% of total assets;
1% to 2% of gross profit;
2% to 5% of shareholders’ equity;
5% to 10% of net profit.

So with the league pulling in $18 billion in revenues, we’re talking more that half a billion for the Jags. $5 million a year comes in under 1% of gross revenue, probably also under 2% of assets, might be over 2% of gross profits, no shareholders, but probably under 10% of net profit. So not really material according to paper 6.

And that’s how you get away with it. Keep it in the rounding error. There was probably some honest mistake somebody made that put the numbers far enough out of whack to make the auditors dig deeper, and boom.

[Rennes Templar]

“Patel? Put the squeeze on him. He’ll Singh!”

He will not curry favor with the Jaguar’s owners, that’s for sure.

[Mean Daddy]

...and wouldn’t be going to jail.

[Political Junkie Too]

Annnnd....where is he now?

In custody. He plead guilty to charges.

-PJ

[Political Junkie Too]

I wondered if he started out as an H-1b visa worker, but I can't find anything on him.

-PJ

[ethel rascel]

In the San Antonio, TX Sunday newspaper, there was a story about a civilian Army employee who stole $100 million from the Army 4H program for dependents.

[Flavious_Maximus]

The owner of the Jaguars is a Muslim from Pakistan. Surprised an Islamist would hire a Hindu Indian. Notice how these filthy thieving foreigners are referred to as “American”. /spit

[Dog]

You are correct

[Dog]

Wonder what tipped them to dig deeper

[Dog]

Wonder what tipped them to dig deeper

[discostu]

My leading guesses would be somebody’s mistake leaned in the same direction as his fraud and caused an audit. Or the cumulative skim made one of the bank accounts noticeably short. Keeping your skim under materiality can help you avoid the auditors for 1 year. But if you keep doing it the cumulative effects eventually wind up material. And of course the longer you get away with something the bigger the ego gets. Cause the smart person who successfully skims $5 mill retires.

[Dog]

Greed got him...and like a dummy he flaunted it with the wild spending.

[Robert DeLong]

Well, New Delhi TV does refer to him as an Indian-American, but that is the only site that even mentions him, at least that I was able to find.

[dfwgator]

"PATEL!!?!?!"

[Ezekiel]

Indian-American

Boy this description sure turns the whole 'dot or feather' question right on its head.

Gambling losses to boot. Patel could have taken away a lot from the hospitality industry, but he lacked Injunuity.

[Deplorable American1776]

Before get TLaw as the QB, I thought it was the PLAYERS that stole the money...not someone in the office. 🤓

[Robert DeLong]

We have two Indian -American groups now. On that were original inhabitants, and one that immigrated more recently.

[NWFree]

NFL owners and much of their staff are notoriously stupid and waste tens of millions on complete flop players so why would they notice this?

[TornadoAlley3]

Ask Joe and Hunter.

[Ingtar]

I doubt they allow the real books anywhere near an auditor. The shenanigans they perform to pay outside the salary cap alone would get them in trouble.