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At the crux of a white-collar criminal case is the issue of intent. A favorable outcome for the criminal defense attorney requires the jury to believe that the defendant did not intend to divert funds or other property. It is no surprise, then, that over the past few years, defense attorneys have been turning to forensic accountants significantly more often in white-collar cases. An experienced and skilled forensic accountant is valuable to the defense team by casting reasonable doubt on the issue of intent and uncovering other evidence in support of innocence or a reduced sentence.

For example, by demonstrating that the defendant was financially well-off at the time of the alleged fraudulent activity, a forensic accountant can provide convincing evidence that there was no need or financial motivation to defraud the employer. A forensic accountant's investigation can also prove that the government's quantification of the fraud was over-stated. If the defendant is convicted, the data and analysis provided can support a defense counsel's argument for a reduced sentence.

Forensic accountants are also called in to assist the defense with destroying the credibility of the government's main witness. In late 2017, I was retained as the expert forensic accountant on behalf of two of the defendants in the Joseph Percoco (former top aide of Gov. Andrew Cuomo) trial. These defendants, Steve Aiello and Joseph Gerardi, were facing two trials—one in Manhattan and the other in Syracuse. Most of the charges were dropped against Aiello, and Gerardi was found not guilty in the Manhattan trial, due in part to our ability to discredit a key witness.

The government's main witness was Todd Howe, a disgraced former Albany lobbyist who signed a cooperation agreement with the prosecutors. Prior to becoming the government's star cooperating witness, Howe had pleaded guilty in 2016 to charges that included extortion, fraud and conspiracies to commit honest services fraud and bribery. Prosecutors are often forced to rely on witnesses whose admissions of past crimes could undermine their credibility, and a forensic investigation is one tool the defense can use to capitalize on this.

Our analysis showed that Howe had embezzled an estimated $2 million from his law firm employer. The funds were funneled through shell companies only to be used later to pay for his and his family's personal expenses. I assisted counsel by analyzing several of Howe's bank accounts and creating a clear depiction of how monies flowed from clients of the law firm into shell companies and then into his own personal accounts. Defense counsel utilized these findings in their cross-examination of Howe, during which they were able to reveal unsavory behavior ranging from embezzlement to doctoring emails. Faced with these facts, Howe admitted on the second day of his cross-examination that he stayed at the Waldorf Astoria Hotel to meet with prosecutors in preparation for the cooperation agreement. He further admitted during his testimony that, after signing his deal with the government, he called his credit card company, claiming that he had not stayed at the Waldorf and requesting that the $600 hotel charge be credited back to him. During his testimony, it also came to light that he lied to the credit card company in violation of his cooperation agreement. Needless to say, the government did not call him to testify in the second related corruption trial.

Some aspects of the forensic accountant's role in a white-collar case are similar to any other case—helping counsel understand complex accounting matters, identifying internal control deficiencies and bringing to light other financial issues that can be used in litigation or settlement. In a white-collar case, however, the accountant can go a step further and assist defense counsel with explaining how a white-collar crime took place without an organization's employees being alert to what was happening.

In white-collar cases, forensic accountants are just as likely to be found on the prosecution side of the table. Law enforcement officials frequently rely on a forensic accountant to help them investigate crimes and understand complex financial transactions, which include, but are not limited to: Ponzi schemes, money laundering schemes, FCPA violations, bribery and corruption, procurement schemes, false billing and bank fraud. Forensic accountants are also retained by law enforcement to assist with whistleblower allegations.

Due to the long "paper trail" typically involved in white-collar cases, prosecutors often retain forensic accountants for the review and analysis of information such as financial accounting records; targeted forensic accounting analysis of large volumes of data and bank records, email and other electronic discovery; and the collection and hosting of electronic data. The information gathered from reviewing documents and electronic data is used to prepare the prosecution for the employee interview stage, which is one of the most effective information-gathering phases of an investigation. This is another area where a forensic accountant's experience is leveraged for optimal results. Forensic accountants are skilled at assisting law enforcement officials with interviewing top-level executives and other employees within organizations involved in white-collar cases. Counsel and accountants should work together to determine which employees need to be interviewed and in which order.

The working relationship between a forensic accountant and counsel (defense or prosecution) is critical to the success of any investigation, but it requires thoughtful planning and participation from both sides. From the beginning of the collaboration, it is extremely important that forensic accountants and counsel think of themselves as a team throughout each phase of the investigation. At the onset, the team should determine the scope of the problem that is the focus of the investigation. Once the nature of the problem has been clearly determined, the team should develop an action plan. It is not uncommon in internal investigations that the nature of the investigation evolves as it proceeds and as such, the team not only has to be focused and efficient but also flexible to changes in strategy.

Most importantly, findings and conclusions must be presented in a clear and concise manner so that a jury and/or judge can easily comprehend complex financial transactions and other complicated pieces of evidence. The attorney should review the findings with the end user in mind and request clarification from the forensic accountant if needed. The same is true if the forensic accountant is providing oral and/or written expert testimony.

If the client decides they would like a written report summarizing the findings of the investigation, counsel and forensic accountants will again need to work collaboratively in drafting the report in a concise and clear manner. Often in white-collar criminal defense cases, counsel may not want findings communicated in writing as it could be detrimental to their client.

It is only through this genuine collaboration that forensic accountants can bring the full value of their investigative and evidence-producing skills, and the attorneys and their clients can reap the full benefits of this professional relationship.

Sareena Malik Sawhney is principal and forensic, litigation and valuation services leader at Grassi & Co.

Author's Note: The finding that Mr. Howe lied to his credit card company made during his testimony was not based on the work performed by Ms. Sawhney.