1)What is the ethical issue in the Rite Aid Inventory Surplus Fraud case?

Rite-Aid had a comprehensive corporate governance system that complied with all the requirements of Sarbanes-Oxley.

The surplus inventory sales and kickback involved collusion between two officers of the company. When Foster wanted to stop the scheme, he was blackmailed in continuing the fraud.

Vice Presidents of the company were involved in a material, nine year surplus inventory sales and kickback scheme.

The internal auditor found and blew the whistle on the surplus inventory sales and kickback cover-up.

2)The key fraud issue in the Franklin Industries Whistleblowing Case is:

Corporate culture pressured an employee to go along with fraud

Recording revenues too soon led to fraudulent statements

Retaliation for reporting an embezzlement fraud

Fraudulent financial statements were covered-up