The audit firm was allowed to visit one of the largest sites where restoration work was being completed by the company in Sacramento. Obviously the site was bogus and Minkow’s associates went to Sacramento, obtained the keys to a partially completed building from the building supervisor posing as representatives of a real estate firm, and put up placards at various places in the building indicating that remodeling and restoration work was being completed by ZZZZ best in order to deceive the representatives of the audit firm and company’s law firm.
The representative of the audit firm had informally visited Sacramento few days earlier from the official visit and saw a building being completed in Sacramento which was in almost the same location as he analyzed in the financial statement. When the official visit was made it was by chance that Minkow’s associates selected the same building and accomplished success by deceiving the representatives.
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