Darryl McCauley Fraud Case

Darryl McCauley

Business Manager and Half Brother of Dane Cook

Who?

• Dane Cook is a stand-up comedian and actor, who established Great Dane Enterprises for his earnings and business ventures.
• Darryl McCauley was a former correction officer
• McCauley was involved with Cook's career from the start, selling merchandise at shows and managing his e-mail list and website
• McCauley was his business manager from the early 1990s to 2008
• McCauley's salary was $12,500 per month or 150k per year

The Fraud

• In total Darryl McCauley stole over $11 million from Great Dane Enterprises
• He stole primarily through transferring the money to his own accounts either by forging checks or using wired transfers
• The largest check he forged was $3 million
• He also bought property for his personal use under the claim that they were "business ventures"
• His fraud wasn't brought to light until Dane Cook wanted to bring in a professional accountant to help with the business.
• In 2010, Darryl McCauley pleaded guilty to 27 counts of larceny over $250, three counts of forgery, embezzlement, and other charges
• McCauley was sentenced to five to six years in prison and 16 total years of probabtion. He was ordered to pay restitution and has to submit financial monitoring to the Department of Probation

His Accomplice

Darryl McCauley's wife knew about the fraud, and actually invested part of the stolen money into two boutiques, several condoninums, and several restaurants. She pleaded guilty to two counts of larceny over $250 and conspiracy to commit fraud. She was sentenced to two and a half to three years in jail with 13 total years of probabtion.

Possible Remedies

The Circumstances

1. This fraud had the opportunity to occur due to the lack of checks and balances in Dane Cook's business, so he should have more than one employee managing accounts.
2. They should keep detailed accounting records and a person not responsible for bookkeeping or signing checks should reconcile bank accounts every month.
3. Access to company's accounts should be restricted and have written proof of business purposes.

1. McCauley didn't state his reasoning for the fraud, but he could have grown envious of Cook's lifestyle as a celebrity. He also could have faced pressure from his wife who had her own ways she wanted to use the money.
2. He could have rationalized his actions by feeling entitled as a member of Dane Cook's family.
3. As a business manager of an account that wasn't monitored strictly by another employee, there was no one to catch his fraud.

VS

Sources

https://www.seacoastonline.com/article/20101201/NEWS/12010320https://www.thethings.com/why-dane-cook-brother-jail/ http://www.cnn.com/2010/SHOWBIZ/celebrity.news.gossip/12/06/dane.cook.restitution/index.html https://omh.ny.gov/omhweb/resources/internal_control_top_ten.html