Unethical or Fraudulent Behavior

Choose the company name
Tesla
Amazon
Netflix
Starbucks
JetBlue
Walt Disney
Proctor & Gamble

In your initial post, introduce yourself and address the following:

Select the company you'd like to focus on for your project.
Summarize an article about unethical and/or fraudulent activity on your selected company. Include the following details in your response:
Include the citation.
If you can't find unethical or fraudulent activity, review the legal proceedings section of the company's 10-K and summarize one of the lawsuits described there.
Explain how the unethical and/or fraudulent activity or lawsuit was resolved and whether it could have been prevented.

Part 2
In your responses to two peers, be sure to address the following:

If your peer posted an article on unethical and/or fraudulent activity, explain how the accounting department could have prevented the unethical and/or fraudulent activity that happened in the article your peer shared.

If your peer posted a lawsuit, explain the potential impact of the lawsuit on its customers and organization as a whole.

First respond.
Hi everyone, my name is Gagandeep Singh, and I am an accounting student. For this course project, I chose to focus on Amazon because it is a very large company that has faced ethical and legal issues in its business operations.

The article I reviewed talks about how Amazon admitted there was a risk of fraud on its platform from counterfeit products being sold by sellers. These fake and counterfeit goods broke the trust of customers, brand owners, and Amazon shareholders since it ruins the trust of the company supplying these items and the shareholders who invest into this company. The article explains that Amazon did not do enough to stop these counterfeit products, which caused concerns about ethics and consumer protection (Brachmann, 2019). Amazon increased efforts to remove counterfeit sellers and fake products from its platform by investing more money into fraud detection systems and brand protection programs. The issue could have been prevented earlier if Amazon had stronger controls and processes of verification in place before allowing sellers to list products. The way to make sure this doesn't happen in the future is to have better monitoring and stricter seller approval processes.

Reference
Brachmann, S. (2019). Amazon admits to fraud risk: Counterfeiting woes affect shareholders, brand owners and consumers. Inventors’ Digest.

Second respond
My name is Matt, and I am a junior at Southern New Hampshire University. I am 21 years old and currently pursuing a degree in business-related studies with an interest in accounting and financial analysis. I am looking forward to developing a deeper understanding of earnings quality and ethical financial reporting throughout this course.

For my ACC 345 project, I have selected Tesla, Inc. as the company I will be focusing on. Tesla has experienced rapid growth and strong market performance in recent years, but it has also been involved in several ethical and legal controversies that raise questions about earnings quality and corporate governance.

A recent article published by Reuters discusses allegations related to Tesla’s marketing and disclosures surrounding its Autopilot and Full Self-Driving (FSD) technologies. According to the article, U.S. regulators, including the Department of Justice and the Securities and Exchange Commission, have investigated whether Tesla made misleading statements to consumers and investors by overstating the capabilities of its driver-assistance systems. These claims raised ethical concerns because exaggerated or misleading disclosures could influence investor decisions and artificially support stock prices, thereby impacting earnings quality (Shepardson, 2023).

The issue has not yet been fully resolved, as investigations were ongoing at the time of publication. However, Tesla has updated some of its disclosures and marketing language to clarify that its vehicles do not offer fully autonomous driving. This situation may have been prevented through stronger internal controls, more conservative public disclosures, and clearer communication with regulators and consumers. Transparent reporting and ethical marketing practices are essential to maintaining investor trust and ensuring that reported earnings reflect the company’s true financial performance.

Reference
Shepardson, D. (2023). U.S. probes Tesla over claims about self-driving cars. Reuters.