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A pillar of anti-fraud education says farewell

From its early days as The White Paper to the 72-page bimonthly publication it is now, Fraud Magazine’s continued credibility and necessity to the anti-fraud profession is in part thanks to the leadership of its editor-in-chief, Dick Carozza. After 25 years at the helm, Carozza is stepping back and retiring. Here we take a look at the history of Fraud Magazine and the large role Carozza played in its success.

On a sweltering day in the summer of 1995, Dick Carozza stepped foot into the Gregor Building in Austin, Texas, for the first time. He and his wife, Sue, had recently relocated to Austin — she’d taken a position as the cancer epidemiologist for the State of Texas to be closer to her Austin-based family.

Carozza, who’d quit his job to follow Sue, saw an advertisement in the Austin American-Statesman (the major daily newspaper for Austin) calling for someone to create a magazine for the ACFE. Carozza was keen to start a magazine from scratch, so he mailed in his résumé post-haste.

Following an initial interview with then-CEO Kathie Green (now Lawrence), Carozza met ACFE founder and Chairman, Dr. Joseph T. Wells, CFE, CPA. “Of course, he wore a Hawaiian shirt,” Carozza says in an interview with Fraud Magazine. “I thought, ‘Well, this is interesting.’ ” Dr. Wells shared his vision of the ACFE and how this magazine could benefit anti-fraud professionals working in the field. Carozza was sold.

Since that stifling Texas day, what began as The White Paper has morphed into Fraud Magazine, a bimonthly publication that brings fraud fighters top-tier anti-fraud principles, profiles, education and more. Carozza’s 25-year endeavor to help fraud fighters battle corrupt and nefarious conduct using practical content has consistently empowered ACFE members to persist.

Multiple states and a hodgepodge of industries

Ever since Carozza can remember, he’s wanted to work in the editorial field. He embarked on his career by obtaining his degree in journalism from the University of Missouri in Columbia. His major was in the magazine sequence with an emphasis in design.

“I really enjoyed design work,” Carozza says. “At one point I wanted to be a graphic artist, but I did a lot of editing when I was in high school, so I thought, well, I’ll play both.”

But magazine work wasn’t abundantly available then, so he worked as a journalist for a daily newspaper and did design work on the side. After working as the city editor of a small-town Kansas newspaper for 2½ years, he became the director of community relations and development for the local hospital because they wanted to start a magazine.

He then moved to Colorado to work on a magazine and marketing at a nonprofit. Carozza met Sue in Colorado and in 1983 — shortly after they were married — they moved closer to Carozza’s family in New Hampshire.

Carozza worked for the Catholic Diocese of Manchester, which covered New Hampshire, as the director of communications. He handled publications and public relations work. Sue worked for a few years for an environmental consulting firm. She happened upon a newspaper advertisement for an epidemiologist position at the New Hampshire Department of Public Health. Though she had no experience in epidemiology — her degree was in fisheries and wildlife from Texas A&M University in College Station — she enjoyed statistics and numbers, so she applied and got the job. “She went from counting fish to counting people,” Carozza jokes.

Sue’s jump into the world of epidemiology would be the catalyst for bringing them to Texas … eventually. She was enjoying epidemiology, but she figured if she was going to do anything in the field she’d need a graduate degree, so she applied to Johns Hopkins University and the University of North Carolina (UNC) — both had stellar public health schools — and ended up in Chapel Hill at UNC.

Carozza didn’t find work immediately, traveling back and forth from New Hampshire to North Carolina for interviews and to visit Sue. After 11 months he landed a job as the director of communications for the Motor and Equipment Manufacturers Association in the Research Triangle Park in North Carolina.

“I knew nothing about cars or trucks, but they needed someone to do their publications, and they said, ‘you can learn,’ ” Carozza says. “Basically a theme of a good part of my career is I find myself in these new professions and new industries where I know nothing — like book publishing, the medical field, the auto parts industry and fraud examination — but I had a good education in journalism to be able to ask the right questions and find the right sources and to learn. That’s been the fascinating part: to be in all of these different industries meeting various types of people and learning what I need to know in order to write about those industries.”

Carozza modernizes The White Paper

Once Sue graduated with a doctorate from UNC, they made their move to Austin, and Dick got the job at the ACFE after interviewing with Dr. Wells. “They offered me the job, and I was slightly bummed because it had only been two months of my little vacation between jobs,” Carozza says with a laugh.

At that point the ACFE was producing a printed newsletter called CFE News and a publication called The White Paper, which followed a magazine format. “What they wanted to do was combine the two and come up with a professional magazine,” Carozza says. “That was enticing to me. I could start from scratch, and I was eager to do that.”

But when Carozza started, the ACFE was still relatively small. “I remember Joe, Kathie and Jim [Ratley, the ACFE’s former president] telling me, ‘We’re not association people, we’re investigators.’ They were figuring it out as they went along.

“Because the whole area of fraud was new to me, I was learning how to put out this magazine at the same time I was learning the field and getting to know people,” he says. “I remember they had the San Antonio annual conference shortly after I started in July, so I said, ‘If you’re having a conference, why can’t I go?’ … So, I went for a day."

Carozza says he quickly bought into Dr. Wells’ mission of providing the best anti-fraud training and service in the world. “I like to have a mission within my job, not just a means to make money,” he says. “I’d worked for nonprofits and service organizations where you’re helping members obtain their goals.”

Giving practical tools to fraud fighters was appealing to Carozza. When he first interviewed at the ACFE, Carozza says he thought all accountants and auditors searched for fraud. He was surprised when he realized finding fraud wasn’t necessarily on their roster of duties. But when they did discover fraud, they often didn’t know how to report it, investigate it or — most importantly — how to prevent and deter it.

“That’s always been Joe and Jim’s intent,” Carozza says. “It makes more sense to prevent and deter fraud than it does to find it, investigate it and get rid of it. It’s much more economical — you save tremendous amounts of money that you would lose to fraud, and there’s less reputational damage. And those are really important reasons, especially for large firms.

“Back then, and even now to a certain extent, many corporations didn’t want to use the ‘f’ word, ‘fraud.’ That was the beauty of the ACFE at this point — they gave tools to people who were fraud examiners or who wanted to be fraud examiners but saw no clear way of doing that in their jobs,” he says.

In January/February 1996, the ACFE published the first 56-page issue of The White Paper in its refurbished form. Carozza and Dick Reeves, a GRAMMY award-winning freelance designer in Austin, comprised the entire editorial staff until Carozza hired an assistant editor a few years later.

Revamped Fraud Magazine highlights newsmakers, whistleblowers

Carozza says he was excited to use a bimonthly publication to give anti-fraud professionals who were hungry for some practical, down-in-the-trenches information. “And not necessarily to catch the bad guys,” he says. “Information to find the evidence, the hard evidence, that shows that there is or isn’t fraud. That this person is culpable or not culpable. … If fraud examiners don’t have the tools, then they can’t find the evidence of fraud. If they aren’t trained in the ACFE Fraud Tree, then they don’t know what to look for."

The White Paper became Fraud Magazine in May/June 2004 after the Enron and WorldCom scandals. Carozza says that the Sarbanes-Oxley Act of 2002 — which was created in the wake of these massive corporate frauds to help protect investors from fraudulent financial reporting by corporations — was a boon for the ACFE because it had a tremendous emphasis on anti-fraud efforts within organizations.

In 2008 and 2009, the recession and sub-prime mortgage crisis created another boost for anti-fraud efforts and Fraud Magazine expanded to 72 pages. “Accountants had to play catch up in their anti-fraud education,” Carozza says. “I’ve seen the membership grow exponentially, so our scope has changed quite a bit in the magazine since 2004.”

Carozza says the May/June 2004 Fraud Magazine featured its first “newsmaker,” Douglas R. Carmichael, CFE, the initial chief auditor and director of professional standards of the Public Company Accounting Oversight Board. And the first of many cover whistleblower profiles was of Marta Andreasen, the European Commission’s former chief accounting officer, in the September/October 2004 issue.

“The most gratifying part of my job is interviewing whistleblowers through the years,” Carozza says. “I admire them so much. I ask myself often, ‘Could I do what they’re doing?’ I’ve never met a whistleblower that has not paid for their truth, for their honesty — professionally, financially and personally."

Carozza says his interview with Bunnatine “Bunny” Greenhouse in the July/August 2006 issue (Bunny was the U.S. Army Corps of Engineers whistleblower) was the first interview that really created his passion for telling whistleblower stories. “Against all odds, she pushed,” he says. “Once I interviewed her and then met her at the annual conference, I started realizing that, my gosh, whistleblowers are in another category.”

Fraud Magazine gained more notoriety when Carozza nabbed interviews with whistleblowers Cynthia Cooper, CFE, and Sherron Watkins. Cooper formerly served as the vice president of internal audit at WorldCom where her team exposed the largest accounting fraud in U.S. history. Watkins is the former vice president of corporate development at Enron. She alerted then-Enron CEO Kenneth Lay of accounting irregularities in financial reports and was called to testify before committees of the U.S. House of Representatives and Senate about her warnings to Lay. Each woman was named as one of three “People of the Year” by Time magazine in 2002.

Carozza says the work has allowed him to meet many other fascinating people. He mentions George J. Mitchell, the renowned mediator for the Northern Ireland peace process; U.S. Sen. Paul Sarbanes and U.S. Rep. Michael G. Oxley (the Sarbanes-Oxley Act); U.S. Sen. Chris Dodd (the Dodd-Frank Wall Street Reform and Consumer Protection Act); Preet Bharara, former U.S. attorney for the Southern District of New York; and actor Richard Dreyfuss.

“In the magazine, we’ve tried to emphasize areas of anti-fraud principles that maybe the rest of the association isn’t,” he says. “We overlap a lot with ACFE materials, and we don’t include things that are outside the canon — we still exist within the boundaries of the Fraud Examiners Manual. But we’ve tried to push the envelope.”

When Sue joined the faculty at Texas A&M University and they moved to College Station, Carozza agreed to stay on as editor-in-chief as a contractor at the behest of Dr. Wells. They now live in Corvallis, Oregon, where Sue has been faculty at Oregon State University in the College of Public Health and Human Sciences since 2009. Carozza has continued to run the magazine and travel to the annual conferences, and occasionally to Austin, ever since.

New expansion for Fraud Magazine

“The ACFE has been able to give CFEs not just a platform, but the bona fides, the professional support and reputation that they didn’t have before,” Carozza says. “There are a lot more CFEs in the governments around the world, and it really holds a lot of weight because they deliver results."

Carozza expands, saying that these days when CFEs approach fraud examinations, they know how to investigate for fraud and interview subjects; about law related to fraud; about financial transactions, fraud schemes and criminology; and preventing and deterring fraud.

“I’m glad to have been a small part of that,” he says. “I’ve wanted to be able to challenge fraud examiners to think a little broader than where they are, or to give them something they want more education on that they haven’t been getting. With my leaving, there’ll be a chance for someone to expand tremendously in areas I hadn’t considered.”

Carozza also has enjoyed working with the many authors who have contributed their work to the magazine, plus the editorial staffers who have come and gone during his tenure. “I want to thank the editors that I’ve collaborated with: Stephanie Dodds, Katie Ford, Suzanne Mahadeo, Amy Logan, Cora Bullock — who’s still a contributing editor — and Emily Primeaux — now a contributing writer,” he says. “And our inventive art directors, from Dick Reeves to Helen Elliott to Becky Plante, really made the magazine sing. Designers Tracy Paccone and Jennifer Rother also contribute their talent. It’s one thing to have a good article; it’s another to have the art direction to attract people to read it.

“My thanks also go to the first circulation manager, Angela Fletcher, CFE, our longtime talented contributing writers, Bob Tie, CFE, and Donn LeVie Jr., CFE; contributing editors, Scott Patterson and Randi Zimmer, CFE; and contributing columnist, Mason Wilder, CFE. Carozza also thanks current Circulation Manager Aimee Jost, CFE; Advertising Coordinator Travis Kolaja, Legal Editor Ron Cresswell, J.D., CFE; and Kate Pospisil, CFE, who maintains Fraud-Magazine.com. “This magazine has always been a team effort to get it to the members on time every two months,” Carozza says.

“Though Joe Wells still reads every word of every issue, he’s always had a hands-off approach with the magazine,” Carozza says. “I’ve appreciated his support through the years.

“The ACFE members are the greatest. I’m always challenged by their resolute devotion to prevent and deter fraud especially when they’re fighting uphill battles,” he says. “I’ve learned so much from the hundreds of authors and columnists who’ve appeared in the magazine’s pages.

“I want to thank so many other ACFE individuals in the last quarter-century,” Carozza says. “I’m grateful and honored for the relationships I’ve had with the wonderful people who make the ACFE gears mesh.”

ACFE staff and friends reflect on Fraud Magazine’s success under Dick Carozza’s guidance

Dr. Joseph T. Wells, CFE, CPA, founder and Chairman of the ACFE — “When Dick Carozza came to work for the ACFE 25 years ago, our association was seven years old and had less than 10,000 members. He retires as the third senior employee when our membership is over 85,000. Everyone loves Dick and with good reason. He is diligent, respectful to our authors and his fellow employees, and has a great sense of humor. Plus he is an amazing writer with an uncanny ability to bring out the best in others. We will miss him immensely.”  

John Gill, J.D., CFE, ACFE vice president - education — “The best thing I can say about Dick Carozza is that I’ve never heard anyone say anything negative about him. That is the absolute truth. He started one month after I did, so I witnessed firsthand how he created a brand-new magazine from basically scratch. From the first issue, the magazine has not only looked good, but it has educated and informed thousands of fraud examiners for 25 years. Thank you, Dick, for the contribution you have made to the ACFE membership.” 

Jeanette LeVie, CFE, ACFE vice president and chief operating officer — “The quality of Fraud Magazine over these many decades under Dick’s direction has elevated the prestige of our profession. He is also one of the kindest, most humble and genuine souls I’ve ever met, which lifts us all.” 

Helen Elliott, creative lead at St. Edward’s University and former Fraud Magazine art director — “Dick was wonderful to work with and was always open to my creative ideas, and contributed many of his own. I know the magazine and anti-fraud profession wouldn’t be what it is today without his dedication, ingenuity and drive for top-notch storytelling. I wish Dick all the best for this next chapter!" 

Angela Fletcher, CFE, ACFE review course manager, one of Carozza’s first ACFE colleagues — “Dick Carozza was one of the first employees I met when I started at the ACFE in 1996. I worked with Dick as the circulation director for The White Paper, which is currently Fraud Magazine. Working with Dick was always such a pleasure. If he was having a bad day you would never know it because he always had a positive attitude. Dick and I could sit for hours and talk about the good times we all had at the ACFE — great memories. I will always to be grateful for the support Dick provided me during my years of working with him. I wish Dick a restful retirement and joyful years ahead." 

Katie Ford, executive director at Truth Be Told (truth-be-told.org) and a former Fraud Magazine assistant editor — “Looking back on my career in editorial, I can point to two individuals who stood out as much more than bosses; they were mentors and role models for me. Dick was one of those individuals. I learned a great deal from Dick simply by watching the way he approached his responsibilities and treated the people around him. Integrity is woven into everything he does, but he doesn’t take himself too seriously. Dick has a great sense of humor and emanates a personable warmth. I never doubted that he really cared about my well-being and respected my opinions. I feel very fortunate to have worked for him early on in my career. He absolutely helped to shape the way I choose to show up for myself and others as a leader.” 

Cora Bullock, former Fraud Magazine assistant editor — “I remember the first time I spoke to Dick on the phone for my assistant editor interview. He asked if I was an introvert or extrovert, and when I noted I was an extrovert, he said gleefully, ‘Great! So am I! So, you won’t be annoyed when I call you.’ That level of management and sense of humor is rare.

Not only is Dick a crackerjack editor, always staying abreast of the seemingly endless updates, changes and reversals to the AP style guide, he’s a wonderfully compassionate person. I remember how lovingly and patiently he tended to his mother-in-law when she moved into the house he shares with his wife, Sue. He often speaks of his pride for Sue, an epidemiologist, and the rest of his family. It’s been my pleasure to continue contact with him via my contributing editor position, and I shall miss his patience, enthusiasm and energy for all things anti-fraud and writing.”

Emily Primeaux, CFE, former Fraud Magazine associate editor — “I wouldn’t be the writer, editor or employee I am today without Dick’s tutelage. I’m forever grateful for the skills and teachings he’s instilled in me these past 6½ years. I left the ACFE knowing I would forever have a mentor and a friend in Dick Carozza. He was always patient with me, but firm in his expectations of my work. When I expressed a desire to write more, he encouraged my passion and let me ‘steal’ some of the more enticing stories from him. After his years of service to the ACFE and the anti-fraud industry, I can’t think of anyone more deserving of a peaceful and enjoyable retirement.” 

Emily Primeaux, CFE, is a contributing writer at Fraud Magazine. Contact her at emprimeaux@gmail.com.