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Investigating Widespread Financial Misconduct in a Latin American Subsidiary

Facing internal allegations of financial misconduct related to unauthorized transactions, misappropriation of funds and possible vendor self-dealing, a Latin American subsidiary of a U.S.-based tire distributor engaged FTI Consulting to conduct a thorough forensic investigation to identify and address the root causes of the issues and ensure that appropriate actions were taken.

Our Impact

FTI Consulting’s forensic investigation uncovered a scheme involving unauthorized vendor payments, kickbacks and inventory manipulation that had been concealed by employees for personal financial gain.
Our multidisciplinary experts identified significant gaps in the company’s internal controls, including inconsistencies in the order-to-cash process across different branches, usage of unauthorized discounts and off-the-books transactions.
The company and its legal counsel were able to take corrective actions, utilizing our recommendations to implement stronger oversight mechanisms and process improvements to mitigate future risks.

Our Role

FTI Consulting conducted more than 30 interviews with employees and reviewed relevant employee communications, including email and WhatsApp, to uncover fraudulent activity and identify key control failures.
Our forensic accounting, data and analytics, and business intelligence experts analyzed numerous financial records, inventory adjustments and other complex data to gather evidence of misconduct and identify key patterns and anomalies.
FTI Consulting mapped the order-to-cash process to identify critical weaknesses in the company’s internal controls that enabled fraudulent practices.
With our bilingual, cross-border capabilities, our investigations experts provided seamless support throughout the engagement, ensuring effective collaboration with counsel in both Mexico and the United States.