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Scott London interview with NPR’s Planet Money

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On December 23, Planet Money aired an interview with Scott London: Episode 671: An Insider Trader Tells All. He is the now-felon, formerly KPMG regional audit partner who earned 14 months in federal housing for insider trading.

There are a couple of new pieces of information in the interview. More on that in a moment.

Rumbi Bwerinofa discusses the interview at Figuring Financial Forensics: On The Record.

She was amused at the description of Mr. London’s shock at finding out the amount of the gains realized by his buddy, Bryan Shaw. In the interview Mr. London says he was in a car with his attorney driving him somewhere as Mr. London read in the newspaper the amount of the gains being in the range of over a million dollars. He asked his attorney to pull the car over because he thought he was going to be physically ill.

Ms. Bwerinofa points out fraud usually develops this way. Schemes start small and then grow to something huge. Having been given only $70,000, Mr. London thought this was still in the range of small potatoes.

She ponders whether Mr. London had previously pondered the idea that there is no honor among thieves. He apparently did not consider that his cheating friend could be cheating him.

Mr. London pointed out in the interview, and earlier comments, that the proceeds were going to be split three ways. That would imply that the total illicit gains would have been in the range of $200,000 or so. Not well over $1,000,000, perhaps as much is $1.6M.

Willfully crossing the line?

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Written by Jim Ulvog

January 8, 2016, 10:04 am at 10:04 am

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Comments from Scott London interview – 7th and final part

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Preparation for prison and life after release.

This is the last post describing Scott London’s interview during a four-hour CPE session on June 26. The first post explained the goal of this series is to organize a number of comments in the session. The course was presented by The Pros & The Cons.

This post will cover preparation for prison, life afterwards, and another earned consequence.

Preparation for prison

When asked, Mr. London said he is spending a lot of time with family and friends before he reports to prison.

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Written by Jim Ulvog

July 23, 2014, 7:12 am at 7:12 am

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Comments from Scott London interview – part 6

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This is the sixth in a series of posts describing comments in an interview of Scott London during a four-hour CPE session on June 26. The first post explained the goal of this series is to organize a number of comments in the session. The course was presented by The Pros & The Cons.

This post will cover a few stray comments in the interview.

Expectation of total amount of insider trading gains

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Written by Jim Ulvog

July 21, 2014, 7:23 am at 7:23 am

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Comments from Scott London interview – part 5 – motivation

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This is the fifth in a series of posts describing comments in an interview of Scott London during a four-hour CPE session on June 26. The first post explained the goal of this series is to organize a number of comments in the session. The course was presented by The Pros & The Cons.

Motivation

In the interview, Mr. London said he is still working through the issues that led him to do this. The underlying factor is a behavioral issue inside of him. He insisted it has nothing to do with the KPMG system.

At the point that sharing transitioned from public to nonpublic information, Mr. London thinks he was responding to the appeal of human nature to help a friend in need once in a while. There was a definite slippery slope. In the midst of these comments Mr. London was clear that he took the blame.

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Written by Jim Ulvog

July 16, 2014, 15:44 pm at 3:44 pm

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Comments from Scott London interview – part 4

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This is the fourth in a series of posts describing comments in an interview of Scott London during a four-hour CPE session on June 26. The first post explained the goal of this series is to organize a number of comments in the session. The course was presented by The Pros & The Cons.

The worst day of his life

The FBI knocked on the door of the London home at 8 AM after everyone else had left the house. Mr. London said that was the worst day of his life.

No kidding.

The interview lasted about 15 minutes. Their biggest concern? How many other people were involved.

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Written by Jim Ulvog

July 14, 2014, 7:58 am at 7:58 am

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Comments from Scott London interview – part 3

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This is the third in a series of posts describing comments in an interview of Scott London during a four-hour CPE session on June 26. The first post explained the goal of this series is to organize a number of comments in the session. The course was presented by The Pros & The Cons.

Status with Bureau of Prisons

As an aside, the Bureau of Prisons has an Inmate Locator Service, which provides public disclosure of federal inmates.

On July 10, Scott London is listed in their database. His register number is 64641-112.

His status is Not in BOP Custody with a release date of Unknown.

Back to the interview…

The sting

Let’s step outside the interview.  At a time I’ll tie in later, the SEC called Mr. Shaw. He poured out the whole story.

Then the FBI got involved and the sting started.

Back to the interview.

In early 2013 Mr. London received three or four phone calls from Mr. Shaw asking for more information.

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Written by Jim Ulvog

July 11, 2014, 8:08 am at 8:08 am

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Comments from Scott London interview – part 2

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This is the second in a series of posts describing comments in an interview of Scott London during a four-hour CPE session on June 26. The first post explained the goal of this series is to organize a number of comments in the session. The course was presented by The Pros & The Cons.

The payoffs

Mr. London says he got around $50,000 in total. He thinks that Mr. Shaw exaggerated the jewelry and concert tickets in order to make the playoffs look bigger. He thinks Mr. Shaw may have paid $3,000 for the watch.

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Written by Jim Ulvog

July 9, 2014, 7:35 am at 7:35 am

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Post-release interview with Scott London – 1

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Just finished watching a 2 hour webcast from CPA Crossings. Gary Zeune interviewed Scott London on what got him into prison on an 14-month sentence for securities law violation.

This interview will be available again on June 18 and June 22. More info here.

The four-hour interview from last June, before Mr. London reported to prison, will be broadcast again on June 15, 25, and 30. More info here.

I heartily recommend the webcast. If you are looking for an ethics course that’s a lot more interesting than the typical “here are the rules” presentation, check out one or both of the above webcasts.

I will have several articles on the interview over the next few days. Will talk about one part of the interview now –

Incarceration timeline

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Written by Jim Ulvog

June 8, 2015, 12:46 pm at 12:46 pm

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Another webcast interview with Scott London in June

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On June 8 you can tune in to a webcast from CPA Crossings for an interview with Scott London. Webcast will be rebroadcast on June 18 and 22.

Interviewer will be Gary Zeune. The session will be good for 2 hours of CPE.

More info and registration at CPA Crossings here.

The Bureau of Prisons website still shows Mr. London is under supervision of the Long Beach Residential Reentry Management office. Read the rest of this entry »

Written by Jim Ulvog

May 28, 2015, 14:48 pm at 2:48 pm

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Comments from Scott London during interview – part 1

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On June 26, 2014, Scott London was interviewed in a four-hour CPE webcast on professional ethics.

The course was presented by The Pros & The Cons. The interviewers were Gary Zuene, CPA, Gaylen Hansen, CPA, and Michael Sallah of the Washington Post.

There are two published interviews that took place before the CPE session:

I’ve seen two articles discussing the interview:

This post will summarize some of the comments from that interview that I found to be of particular interest.

The goal of this series of posts is to get the interview comments organizing into related topics.

Context for this series

I am presenting my comments about the interview with only a few narrative statements. At some later point I will correlate this with other news reports.

I won’t comment now about my perceptions or how we interpret Mr. London’s comments. That is for another series of posts. Maybe.

How did the insider trading scheme develop?

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Written by Jim Ulvog

July 7, 2014, 10:29 am at 10:29 am

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Interview with Scott London during CPE webcast

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Scott London was interviewed at length during a CPE webcast presented June 25, 2014. The class was presented by Gary Zuene, of The Pros & The Cons.

Mr. London was remarkably open.

He repeatedly accepted full blame for the insider trading. At several points he explained the context, pressures he was under, and actions by others (especially his golfing buddy) that help us understand the situation better. Each time he mentioned something outside of himself he again said that he is responsible. He is to blame.

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Written by Jim Ulvog

June 26, 2014, 9:36 am at 9:36 am

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2 interviews with Scott London

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Two interviews of Scott London have appeared quite recently in advance of his marathon interview in a CPE class:

A few ideas from each of the interviews and a few of my observations.

Quentin Fottrell at Market Watch –

Mr. London perceives that insider trading is rampant.

He asserts he received about $50,000 in total, which includes the Rolex (which he rarely wore), and concert tickets.

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Written by Jim Ulvog

June 21, 2014, 11:02 am at 11:02 am

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CPE event of the year – 4 hour ethics class featuring interview with Scott London

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Well, at least I think it will be the event to see. Next Wednesday, June 25, Scott London will be interviewed in a webcast presented by The Pros & The Cons.

To my recollection, all the previous interviews of Mr. London were brief events entering or leaving a court room. There have been a few conversations with reporters, but nothing in detail. This will be the first, in-depth interview I know of. Several hours will allow the time to give full, nuanced answers and explore follow-up questions.

Gaylen Hansen, former chair of the NASBA Ethics Committee will be the lead interviewer. Gary Zuene recently announced the Michael Sallah, investigative journalist from The Washington Post, has joined the interviewing team. Looks to be a great team of interviewers.

Block out 1 to 5 Eastern / 9 to 1 10 until 2 Pacific time for a 4 hour ethics class.

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Written by Jim Ulvog

June 20, 2014, 10:34 am at 10:34 am

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Number of Scott London’s insider trading incidents based on cross-referencing SEC action, plea agreement, and FBI complaint.

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FBI surveillance photo of Mr. Shaw passing $5,000 to Mr. London. Photo is included in the criminal complaint available in PACER system and thus is a public document.

FBI surveillance photo of Mr. Shaw passing $5,000 to Mr. London. Photo is included in the criminal complaint available in PACER system and thus is a public document.

Previously discussed the SEC enforcement action against now-felon, formerly-living-on-top-of-the-world KPMG regional audit partner Scott London for his insider trading activities.

After reading the criminal complaint along wot the SEC’s action, I now think the actual number of incidents of insider trading is two or three times more than even the SEC claims.

The enforcement action listed 18 specific incidences of insider-trading. This is larger than any number I’ve seen previously, which drew my interest. My recollection is there had been around a dozen or so incidents. Decided to compare three documents to see what they show about the extent of insider-trading. I looked at:

If you want to read the plea agreement and criminal complaint, I provided links here.

The plea agreement states there were at least 14 incidents. The criminal complaint cites a slightly small number but that is a soft estimate by Mr. London. What caught my attention is the SEC enforcement action lists 18 incidents.

The SEC’s listing includes: Read the rest of this entry »

Written by Jim Ulvog

January 12, 2016, 8:15 am at 8:15 am

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Scott London is in prison on 7/19/14. Expected release date 7/23/15.

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Looks like he surrendered into custody yesterday.

The Bureau of Prisons has an Inmate Locator Service which provides location and incarceration data for all federal prisoners since 1982. Lookup is by name or register number.

As of Saturday morning, 7/19, the locator shows Scott London (register 64641-112) is incarcerated at Taft Correctional Institute, near Bakersfield, California.

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Written by Jim Ulvog

July 19, 2014, 6:57 am at 6:57 am

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