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News this week

• BPareteum fraud wrap-up (Litigation Release No. 26334, Jun 24 2025) – Final judgments against ex-CFO Edward O’Donnell and ex-CCO Victor Bozzo end the SEC’s revenue-inflation case: both are permanently barred from public-company roles, disgorgement is ordered (offset by criminal forfeiture), and the matter underscores the Commission’s hard line on aggressive revenue recognition that overstated 2018 results by 60 % and early-2019 by 91 %.

• Mortgage lending by age dataset – Published June 23 2025, new Consumer-Credit-Trends tables chart mortgage origination volumes and year-over-year changes for four age brackets. Under-30 borrowers post the strongest post-pandemic rebound, while 65-plus originations remain below 2022 peaks, informing strategy, CRA planning, and demographic risk analysis.

• Urgent AML alert on Mexican institutions – FINRA’s SIU alert (June 27 2025) follows FinCEN orders naming CIBanco, Intercam Banco and Vector Casa de Bolsa “primary money-laundering concerns” linked to illicit-opioid trafficking. Firms have 21 days to halt all fund transfers and must revise Rule 3310 AML procedures or risk Bank-Secrecy-Act violations.

• Santa Anna National Bank failure (27 Jun 2025) – OCC closed the $64 million-asset Texas bank for unsafe practices and “substantial dissipation of assets”; the FDIC, as receiver, transferred insured deposits to Coleman County State Bank. Second U.S. bank failure of 2025, estimated to cost the insurance fund ≈ $23.7 million.

• EPA Greenhouse-Gas Reporting rethink (RIN 2060-AW76) – On 27 June, OIRA opened review of EPA’s draft “Reconsideration of the Greenhouse Gas Reporting Program.” The rule could expand or tighten mandatory emissions data for 8,000-plus facilities, influencing compliance costs, future SEC climate-risk filings, and the U.S. emissions inventory’s accuracy.

A thought from our Author Norm Osumi 

Auditing the Blockchain: Lessons from Deloitte’s Circle Engagement

Deloitte’s audit of Circle spotlights how blockchain-based financial reporting demands precision, transparency, and evolving expertise. The firm zeroed in on stablecoin redemptions—USDC and EURC—ensuring that each token issued was backed by fiat reserves.  In their audit report, Deloitte identified deposits from stablecoin holders as a Critical Audit Matter due to the complexity of smart contract activity and the risks of unmatched token issuance. To address this, they:

• Tested controls over the minting and burning of stablecoins.

• Assessed daily reconciliation controls linking reserve assets to coins in circulation across approved blockchains

• Used a proprietary tool and specialists to independently retrieve and analyze on-chain data.

• Evaluated the reliability of blockchain audit evidence

These steps weren’t optional—they were driven by PCAOB standards requiring deep system understanding (AS 2110), internal control testing (AS 2201), appropriate evidence (AS 1105), and expert involvement (AS 1210)
As crypto auditing evolves, expect continuous monitoring, cryptographic proofing, and AI‑driven anomaly detection.

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Ask the PCAOB Whisperer

Q. I’m closing Q2 and the rule‐storm is real. Which developments should I flag for my audit committee?

A:

1. Revenue-recognition red flag

The SEC’s final judgments against Pareteum’s former CFO and CCO over 60 %–91 % revenue inflation are a fresh reminder that auditors will laser-focus on cutoff and contract mods this quarter. Expect more probing of side-letter controls and post-period adjustments.

2. Broker-dealer buffer reprieve

Also at the SEC, daily customer-reserve calculations under Rule 15c3-3 now start 30 June 2026 (six-month delay). If you have a captive broker-dealer, update liquidity models and SOX scoping; testers will verify that the new timeline is baked into process narratives.

3. Data gold mine

SEC’s DERA released 2010-24 broker-dealer, M&A and BDC datasets. Use them to benchmark peer leverage or deal valuations and know your auditor may do the same when challenging “reasonable” assumptions.

Weekly Podcasts

We want to keep you engaged with meaningful topics, so we create weekly podcasts and host periodic webinars.

On this week’s ReportingNorms.ai - Remote work has completely transformed how companies serve clients and find the best talent - no more being limited to your own backyard! Our guest Ed Kennedy reflects on how traditional local models have been upended, unlocking new ways to work together across regions. Curious how this shift is impacting businesses and people? Tune in to the full episode for more insights!

Tune in to hear more.

Here’s the audio version of the same:

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