Richard T. Faughnan is a managing director with Kroll’s Business Intelligence and Investigations practice based in the New York office. Richard focuses on independent monitorships, corporate investigations and compliance matters.
Richard joined Kroll from an international consulting company where he was co-leader of that firm’s public sector and monitoring practice. Prior to this, Richard was Assistant U.S. Attorney for the Eastern District of New York for over 13 years, where he served as Chief of the Public Integrity Section. During his time with the Eastern District, he directed numerous investigations and prosecutions into an array of criminal activity committed by corporations and individuals, including bank and securities fraud, mail and wire fraud, money laundering, bribery and federal tax offenses. Richard began his career as an assistant district attorney in Kings County, New York, where he served as Deputy Chief of the Appeals Bureau. Richard’s extensive experience as a federal and state prosecutor gives him a thorough understanding of investigations into a wide range of fraudulent conduct across industry sectors.
The following is a brief list of representative consulting engagements:
- Led 13 integrity monitoring engagements overseeing multi-billion-dollar government agencies, programs and infrastructure projects, as well as corporations in the financial services, construction, higher education, transportation, stevedoring, carting, regulated waste disposal, information technology, child welfare and professional services industries.
- Led a comprehensive fraud assessment of the payment processing systems of a major technology company to identify vulnerabilities and weaknesses in the company’s internal control environment.
- Created Anti-Money Laundering (AML) and Foreign Corrupt Practices Act (FCPA) compliance programs and provided compliance training for an international corporation
- Led internal investigations for foreign financial institutions into off-shore tax evasion.
- Conducted with outside counsel an internal investigation on behalf of a U.S. financial institution into the sales practices of its consumer banking division.
- Led the financial investigation on behalf of a bankruptcy trustee of a commercial lending institution that defrauded its investors, as part of a Ponzi scheme, of more than USD 400 million (mn).
- Led an internal fraud investigation for an international corporation into violations of the internal revenue code by former management.
- Led the financial investigation on behalf of a bankruptcy trustee of a commercial mortgage lending institution that defrauded other lenders, title companies and borrowers of more than USD 80 mn.
- Led a construction fraud audit of dozens of construction projects for a U.S. financial institution.
- Led an internal fraud investigation for an international not-for-profit healthcare corporation in Africa.
- Co-led the team retained by counsel to the Audit Committee of a major public utility to conduct a company-wide review of its anti-fraud and other internal control and compliance functions following the indictment of a managerial-level employee by the U.S. Justice Department in a multi-million-dollar kickback scheme.
The following is a brief list of representative federal prosecutions:
- Directed the investigation and prosecution of the top executives of Allou Healthcare, Inc., for a USD 177 mn bank fraud, securities fraud and insurance fraud, as well as for bribery, money laundering and obstruction of justice. Obtained guilty pleas from the CEO, CFO, vice president and five other co-conspirators to charges ranging from conspiracy to commit bank fraud, securities fraud, honest services mail fraud and obstruction of justice, to securities fraud and money laundering.
- Directed the investigation and prosecution of a member of the New York City Council for demanding a USD 1.5 mn bribe from a developer in exchange for the councilman’s political support for the developer’s multi-million-dollar construction project. Obtained guilty pleas from the councilman and his co-conspirator to extortion.
- Directed the bribery investigation and prosecution of a federal contracting officer, and executives of the general contractor, a subcontractor and the construction quality management firm on a USD 500 mn federal construction project. Obtained guilty pleas from all defendants to bribery.
- Directed the investigation and prosecution of the principals of a foreign currency trading firm for a decade-long Ponzi scheme that defrauded investors of USD 100 mn. Obtained guilty pleas from both principals to conspiracy to commit mail and wire fraud, and recovered nearly USD 30 mn in forfeited assets.
Education and Certification
- J.D., cum laude, George Washington University, National Law Center
- B.A., magna cum laude, Rutgers College
- Admitted to the Bar in New York and New Jersey
- American Bar Association
- Association of the Bar for the City of New York
- Federal Bar Council