Accounting fraud: a former fraudster reveals all

Investigative reporters alone can make fraudsters sweat

It takes one to know one - especially when it comes to artful accounting manipulations.

Barry Minkow, the former founder and top executive of the ZZZZ Best, a carpet-cleaning company that also performed building restorations, knows first-hand how to perpetrate fraud. Minkow started his apparantly lucrative business as a teen working out of his parent's garage. He took his company public in 1986 and by 1987 had seen company revenues spike to $50 million.

The only problem was that despite 1,400 employees in 300 office locations, his company's revenues were pure fabrication. His company was later discovered to be a pyramid scheme. Minkow hadn't just cooked the books; he had completely altered them to the tune of $26 million. He and several other ZZZZ Best executives were convicted of fraud, and Minkow served seven-plus years in jail.

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