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Valeant pharmaceuticals fraud

Author

Listed:
  • Maude Belanger
  • Charles Hounwanou Dossa
  • Sanvee Menah Koffi
  • Isabelle Sauvageau
  • Nadia Smaili

Abstract

Purpose - The aim of this study is to examine the patterns of fraud present in Valeant’s 2014 and 2015 financial statements and determine through a risk management analysis whether these frauds could have been prevented. This analysis provides the opportunity to more effectively prevent financial statement fraud. Design/methodology/approach - Data were collected from Valeant pharmaceuticals annual reports, financial statements reports and financial authority documentation. Based on these documents, this paper analyzes the different fraud schemes and investigate whether fraud could have been detected earlier by governance actors. In particular, this paper examines the firm’s financial statements three years before the fraud was detected by the Securities and Exchange Commission. Findings - The analysis of financial statements reveals few clues and no alarming red flags three years before detection of the fraud. However, financial statement analyses were complex because of the many acquisitions the firm made in the years before. Originality/value - This paper aims to contribute to the literature on fraud by investigating a case of financial statement fraud.

Suggested Citation

  • Maude Belanger & Charles Hounwanou Dossa & Sanvee Menah Koffi & Isabelle Sauvageau & Nadia Smaili, 2024. "Valeant pharmaceuticals fraud," Journal of Financial Crime, Emerald Group Publishing Limited, vol. 32(3), pages 545-557, September.
  • Handle: RePEc:eme:jfcpps:jfc-05-2024-0150
    DOI: 10.1108/JFC-05-2024-0150
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    Cited by:

    1. Ambati, Murari & Munipalle, Pravith, 2025. "Anticompetitive Practices in the Pharmaceutical Industry: Market Dynamics, Trading Strategies, and the Role of Short-Selling in Promoting Accountability," OSF Preprints 8rd7w_v1, Center for Open Science.

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