The rise of the financial machines

Forget Gordon Gekko. Computers increasingly call the shots in financial markets

Funds run by computers that follow rules set by humans account for 35% of America’s stock market, 60% of institutional equity assets and 60% of trading activity. New artificial-intelligence programs are also writing their own investing rules, in ways their human masters only partly understand. Industries from pizza-delivery to Hollywood are being changed by technology, but finance is unique because it can exert voting power over firms, redistribute wealth and cause mayhem in the economy. read more »

Whistleblower Accuses Shipbuilder of Falsifying Submarine Stealth Coating Tests

America's largest military shipbuilding company has been accused of falsifying tests and certifications on stealth coatings of its submarines "that put American lives at risk," according to a complaint filed in federal court last month.

The qui tam lawsuit – a type of suit which is brought under the False Claims Act and rewards whistleblowers in successful cases where the government recoups damages due to fraud – is being brought by Ari Lawrence on behalf of the U.S. Government. According to the complaint, Lawrence, a senior engineer at Huntington Ingalls who has worked there since 2001, has provided evidence of the alleged graft at the company's Newport News Shipbuilding facility in Virginia. read more »

Former KPMG Executive Pleads Guilty To Fraudulent Scheme

David Britt, a former KPMG partner who was the co-head of the Banking and Capital Markets Group within the audit group of KPMG’s Department of Professional Practice (“DPP”), pled guilty today to participating in a scheme to defraud the PCAOB by obtaining, disseminating, and using confidential lists of which KPMG audits the PCAOB would be reviewing so that KPMG could improve its performance in PCAOB inspections.  BRITT pled guilty to one count of conspiracy to commit wire fraud before the Honorable J. Paul Oetken.

The PCAOB is a nonprofit corporation overseen by the SEC that inspects the audit work performed by registered accounting firms with respect to the financial statements of publicly traded companies. read more »