Wednesday, June 29, 2011

Woodmere, New York Synagogue Treasurer Accused Of Stealing Funds From Congregation


A respected treasurer of an historic Long Island synagogue was charged with stealing more than half a million dollars from his congregation.

The accusations of embezzlement have left a community wounded, and members of the beloved Woodmere synagogue feeling betrayed, reports CBS 2′s Jennifer McLogan.
The elected treasurer of Congregation Aish Kodesh, 47-year-old Isaac Zucker, was arrested at 2 a.m. Wednesday inside a hotel room near Long Island MacArthur Airport and charged with grand larceny.
Investigators said Zucker had been tipped that police were onto him. His wife reported him missing on Friday, when Zucker’s alleged scheme began to unravel.
“From 2008 to 2011, Mr. Zucker stole - embezzled – more than $600,000 of the congregation’s funds,” Nassau County police Det. Lt. Kevin Smith said.
Smith said the congregation became suspicious when their checks started to bounce.
“Funds were diverted from the operating account, and then swept out, so that’s why there was no inkling – plus you had a person who you would never have suspected,” congregation chairman Azriel Ganz said.
The orthodox synagogue is a fixture in Woodmere. Its passionate members said the news – more than half a million dollars gone with the wind – hit them like a sucker punch.
“I think it really shocks the community when people steal, whether it’s $600,000 from a synagogue or loose change in dollar bills from a poor box in a church,” Smith said.

Authorities told WCBS 880′s Sophia Hall that Zucker allegedly stole the money over a three-year period.

Zucker pleaded not guilty and was being held on $300,000 bond. The special prosecutor called him a flight risk, and his passport was confiscated.
Zucker’s wife and daughter were at the courthouse Wednesday, as were his parents and siblings, in a show of support.
Zucker is also a local securities attorney, with his office next to the Roosevelt Field Mall.

Ganz said the allegations are heartbreaking, and that the stolen money was needed for operating expenses.
“We did an emergency fundraiser and we raised a significant amount of money over the weekend,” Ganz said.
Prosecutors said it is not yet clear where the missing cash went, or whether it can be returned to the congregation.
Nassau County police are asking any current or former law clients of Isaac Zucker to contact them if they suspect any misappropriation of their money.

Wisconsin man pleads guilty to embezzlement at church

FROM WQOW Eau Claire

Guilty pleas Wednesday from a church treasurer charged with embezzlement.

John Roenz of Neillsville was accused of embezzling more than $140,000 from Calvary Lutheran Church. He handled the church finances for 24 years.
Wednesday Roenz pleaded guilty to felony theft and filing false tax returns. The DA says he will recommend a year in jail, and restitution of $132,000 at sentencing.

TurnKey Construction trial date delayed until January in California


Trial has been postponed yet again in an enormous embezzlement case against a former Santa Maria-Bonita School District employee and three ex-TurnKey Construction executives as efforts continue to settle the matter ahead of trial.

The trial was expected to start in July for the four defendants charged with taking more than $3.6 million in school construction funds in the early 2000s.
However, the trial date has been rescheduled for Jan. 17, 2012, said Deputy Attorney General Edward Skelly, one of the prosecutors assigned to the case.
“The judge is very anxious for us to settle the matter,” Skelly added.
Case attorneys previously have estimated that the trial could last up to six months.
Trial dates were scheduled starting last year, but a series of postponements has plagued the case.
The dates were pushed back when problems arose, such as some defendants were no longer financially able to pay for their own attorneys, or because efforts were being made to settle the case.
Those involved in the matter are next due back in court July 20 for a settlement conference before Superior Court Judge Brian Hill in Santa Barbara.
“We’re always optimistic about settlement, but we’re getting ready for trial in January,” Skelly said.
Charged in the matter are Cynthia Clark, the Santa Maria-Bonita School District’s former assistant superintendent of business; former TurnKey Chief Executive Officer Harold Clark III; ex TurnKey Vice President David Irwin and past TurnKey Chief Operating Officer Michael Bannan.
Cynthia Clark, who is not related to Harold Clark, oversaw invoices and payments made to TurnKey.
From 2000 to 2005, TurnKey managed multiple construction projects for the Santa Maria-Bonita district, which operates elementary and middle schools in the Santa Maria Valley.
During that time, the construction company signed $62 million in construction-management contracts with the district for the completion of 16 major projects. But in fall 2004, questions about TurnKey’s business practices began to surface.
The school district stopped all payments to the company, and an investigation began into the accounts, invoices and payments made to TurnKey.
As a result of the investigation, 74 criminal counts were filed against Cynthia Clark, Harold Clark and Bannan. Irwin faces fewer counts, but it is unclear how many.
Harold Clark, Bannan and Irwin are accused of taking the district's payments with Cynthia Clark's knowledge and keeping them for themselves and TurnKey, rather than paying their subcontractors.
The company declared bankruptcy in January 2005, and the Attorney General's Office filed charges in March 2008.
If convicted on all counts, Cynthia Clark, Harold Clark, Bannan and Irwin could face up to 38 years in prison.

School Custodians Charged With Fraud and Embezzlement in New York


The office of the United States attorney for the Southern District of New York and Richard J. Condon, the special investigator for the New York City schools, are expected to announce charges on Wednesday against two custodians who used employees on the school system’s payroll to maintain personal property in Queens. The employees are also being charged in the case.

The case stems from a report released by Mr. Condon’s office in April, in which one of the custodians, Trifon Radef, was accused of running a years-long scheme involving school jobs he was paid for, but did not always perform, instead spending time at a soccer club in Astoria, restaurants and his home.
While Mr. Radef could often be found during the day at his post as a full-time custodian at the Theodore Roosevelt Educational Campus, in the Fordham section of the Bronx, he rarely reported for his night custodial job at Harry S. Truman High School, in Baychester, according to the report.
In the criminal complaint unsealed on Wednesday, Mr. Radef and another custodian, Nicanor Fernandez, were said to have improperly signed school system payroll checks to compensate the employees, who were directed to work on as many as nine buildings Mr. Radef owned in Queens.
The employees being charged in the case are James Coppola, Frank Chambers and Michael Cunningham Sr. Mr. Coppola had been assigned as a handyman at Intermediate School 25 in Queens; Mr. Chambers as a cafeteria worker at Public School 158, also in Queens; and Mr. Cunningham as a custodial fireman at P.S. 158.
The charges against the five men include fraud, embezzlement and theft.
The allegations came to light in January 2010, after two former custodians at the Roosevelt campus reported the case to Mr. Condon’s office. Investigators built their case against Mr. Radef by following him on several occasions last year. They used E-ZPass records to show that, on more than 550 paid work days, he traveled between the Bronx, where he worked, and Queens, where he lived, during work hours.
Mr. Condon’s report also said that Mr. Radef bought construction supplies and paint for buildings he owned with money from the schools’ custodial accounts.

Oregon youth groups' treasurer pleads guilty to theft.


An Oregon woman has pleaded guilty to embezzling money from two youth sports leagues and a school parents club and agreed to repay more than $135,000.

Renae Marlee Mason of Lake Oswego could face a maximum six years in prison when she is sentenced Aug. 11. The 45-year-old woman pleaded guilty Tuesday in Clackamas County Circuit Court to seven theft counts. Prosecutor Michael Wu tells The Oregonian that efforts to agree on a sentence recommendation failed. It will be up to a judge to decide her sentence.
Mason's lawyer Kevin Davenport says she has agreed to repay the money she took from Lake Oswego Junior Baseball, Lake Oswego Youth Football and the Lake Oswego Junior High School Parent Club. She served as volunteer treasurer for the organizations.
Wu says that amount will exceed $135,000.

Tuesday, June 28, 2011

Audit: $1 million skimmed at North Carolina Central University


The North Carolina Office of The State Auditor released a report Tuesday that says the former executive director of a minority program headquartered at NC Central University diverted $1 million to a checking account for payments to herself and others.

The program called the University Consortium was created in 1999 as a partnership between the North Carolina Department of Public Instruction and 12 North Carolina historically minority institutions of higher education. It was intended to work on strategies to close the minority achievement gap in North Carolina with an emphasis on students from kindergarten through twelfth grade.
The auditor's report says the General Assembly began funding in fiscal year 2001 and the Consortium received $3,586,400 in state appropriations through fiscal year 2010. It also got grants from private organizations, federal agencies, and state agencies.
In a news release in April, 2010, NC Central Chancellor Charlie Nelms said the program had taken in a total of about $13 million and he was asking for an outside investigation of alleged embezzlement by a former employee.
While the auditor's report does not name the former executive director of the Consortium, ABC11 has learned she is Nan Coleman. The report says she and former NCCU Provost Dr. Beverly Washington Jones set up the Consortium as a separate entity from the school.
"As a result, the former Provost and former Executive Director did not receive proper oversight from the University, the Foundation, or the Advisory Board," says the audit.
"In April 2004, the former Executive Director opened an unauthorized, undisclosed bank account in the University Consortium’s name," says the report.
"The former Executive Director had sole control over the undisclosed bank account and diverted over $1,000,000 to the undisclosed bank account in a skimming scheme over a six year period," says the report. "From 2004 through 2009, the former Executive Director made payments to herself and other University Consortium staff and contractors directly from the diverted funds. The former Executive Director received over $287,000 and the former Provost received nearly $62,000 from the diverted funds."
In a statement after the audit was made public Tuesday, Chancellor Nelms said he agrees with its findings and says he has "already taken decisive action to implement the necessary changes."
Nelms said the Consortium has been discontinued, the leaders responsible no longer work for NCCU, the suspect checking account has been frozen, and new policies have been put in place.
"A review of all NCCU accounts is under way to ensure their placement is consistent with the mission to serve the university," said Nelms in part.
Neither Coleman or Washington Jones have been charged criminally, but Nelms said "we will work with the Attorney General’s Office and the Durham County District Attorney to use all means available to recover any inappropriately expended funds."
"Personally and professionally, I am disappointed and dismayed regarding the alleged behavior of a few to the detriment of the university as a whole. However, I am confident that North Carolina Central University will emerge from this situation stronger and even more committed to excellence," said Nelms.

Sunday, June 26, 2011

California school district shirks its duty


Just when you thought the Redding School District's reputation for mismanagement couldn't grow any worse, it surprises everyone in town and tops itself.

Last summer, Sycamore Elementary School librarian Wannel Stolz was arrested on felony embezzlement charges alleging theft from the parent-teacher club and the school itself. That would have been a disturbing allegation on its own, but what really piled the logs on the fire was that Stolz's husband, Rein Stolz, was the president of the school board at the time. (He quickly resigned.) Further, there were credible allegations that those who'd tried to blow the whistle on Stolz, including Sycamore's principal, faced retaliation.
What followed was an embarrassing collective denial of responsibility when the district badly needed leadership willing to clean up the mess. And the abdication continues nearly a year later. Last week the board took steps to allow Wannel Stolz — whose trial is scheduled for this summer — to return to work and in the process force the layoff of another school librarian with less seniority.
Cindy Trujillo, the district's human-resources director, wouldn't comment on the case in detail, citing personnel privacy, but did point out that the district cannot fire an employee simply because of a criminal accusation. Even a conviction, at least on this charge, wouldn't be grounds for automatic dismissal.
It is famously difficult for schools to fire employees for cause, but if there were ever case that demanded taking steps toward doing so, this is one. Stolz isn't accused of off-hours misconduct that didn't affect her school, but of directly abusing her position to steal on the job.
Is Stolz presumed innocent? Of course. And it is ultimately a jury's job to weigh whether the charges are proven beyond a reasonable doubt.
But in the meantime, the police found enough evidence to make an arrest. The district attorney found enough evidence to file charges. The judge found enough evidence to hold the case over for trial. There is a substanial body of evidence of wrongdoing. For district administrators to ignore all that is simply a dereliction of their duty to students, parents and taxpayers.
Trujillo last week declined to comment on whether the district had launched its own, independent investigation, but she did say that "the public does not have access to law enforcement's investigative files." That's incorrect. The Shasta County district attorney's office filed charges nearly a year ago, and the police reports and other documents that underlie the criminal charges are public. The district has abundant information on which to base its own decisions — or would if anyone cared to exend the strenuous effort of taking a drive to the courthouse.
The California Education Code states that employees may be dismissed or disciplined for "unprofessional conduct" and "dishonesty," among other job-related wrongdoing. If this case doesn't present strong enough evidence for the district to take action, what would?
The district is subject to strict and complex laws and might not be in a position to fire Stolz. Fine. At the very least, anyone facing felony charges for on-the-job conduct should remain on unpaid leave until the courts render a verdict. (Last summer, Stolz took a voluntary leave of absence, which is ending.)
The Redding School District hired a new superintendent in April to replace Diane Kempley, who is retiring. The refreshed leadership can't come soon enough.
And it's hard not to draw a larger political lesson here. Down in Sacramento, the heart of the feud over the state budget is that Republicans refuse to budge one inch on allowing new taxes or even a vote on them without various reforms. They won't throw more money at a broken government, or so they argue.
Whether the heart of Redding School District's troubles is the system or the people running it, when schools are pink-slipping good employees to make room on the payroll for accused felons, we're dealing with a bureaucracy grown inept to the point of corruption. More money can't fix that.

LA Schools step up oversight of Charter Schools

The auditorium at the Los Angeles Unified school board was awash in varying shades of blue shirts at a recent meeting - sky blue belonged to parents from Crescendo Schools, while navy was worn by parents from ICEF Public Schools. Outside, another group of parents chanted and waved picket signs to "save ICEF schools."
Both groups donned their school colors and showed up for the same reason - to prevent their troubled charter schools from shutdown, a result of cheating on state tests at Crescendo and fiscal bungling at ICEF.
"Our kids are innocent," said Noami Neal, mother of a Crescendo third-grader. "It was not their fault, it was the adults."
It's been a rocky year for charters in Los Angeles Unified, which hosts the most charter schools of any district in the nation - 183 currently, with roughly another 20 slated to open in the fall. Besides financial mismanagement and the cheating scandal, a principal at another charter was sent to prison for embezzlement and another school was closed for a poor academic record.
The run of problems has forced the district to step up oversight and take a tougher stance on the publicly funded, independent schools.
"This has been a year of reflection of how we can prevent some of these things from happening," said Parker Hudnut, who headed LAUSD's innovation and charter schools division until leaving this month to take the reins at ICEF, which stands for Inner City Education Foundation.
The district sent a clear message of its new posture when it shuttered Cornerstone Prep School for abysmal student achievement earlier this year, the first closure due to academic performance.
Although the vast majority of charters operate successfully, the missteps at a handful of LAUSD schools during the past year illustrate how the autonomy at the core of charter philosophy - that freedom from district bureaucracy allows for greater innovation and higher achievement - can sometimes trip them up.
"Flexibility is the tradeoff for accountability," said Jeanne Allen, president of the Center for Education Reform.
The key is catching problems before schools derail. About 12 percent of charters have closed since 1992, according to a 2009 study by Allen's organization.
Regulations governing charters differ among states. In the District of Columbia, for example, a separate school board authorizes charters and monitors them. In New York, an independent institute at the State University of New York has the responsibility, while the mayor's office holds that duty in Indianapolis.
In California, which has 900 charters - the most of any state in the nation, the local school district is responsible for authorizing and overseeing charters. That can be problematic because charters are often viewed as rivals to traditional schools.
"School districts don't want charters to exist and they're in charge of overseeing them," said Greg Richmond, executive director of the National Association of Charter School Authorizers, which represents charter regulators. "That just sets up constant problems. Charters accuse districts of picking on them and fight everything they do."
Advocates of the alternative schools say districts are hostile to the point of flouting laws that allow charters to use district facilities, such as classrooms and playing fields. The state also does not allow charters to access the same financing mechanisms as districts.
"There's plenty of oversight," said Caprice Young, former chief executive of ICEF brought in last fall to right listing finances and former executive director of the California Charter Schools Association. "The problem is the state and districts throw barriers in the way."
Still, Young suggested that if LAUSD had been paying closer attention to ICEF's required quarterly financial statements, the 15-school organization may not have ended up in such a deep financial pit. ICEF, which is widely hailed for sending more than 90 percent of its inner-city students to college, was saved by philanthropists and is merging with another management organization.
Supervising charters involves poring over audits and financial statements, as well as reviewing test scores and other measures of achievement. Financial mismanagement accounts for about 40 percent of closures. Experts say that's because most charters are launched by educators, not accountants.
LAUSD has 20 staffers supervising charters. After the ICEF fiasco, Hudnut said the office has been reorganized to form four teams of three people with each team responsible for overseeing about 60 schools, accounting for future growth.
To help plow through slews of financial reports, the office is contracting outside accountants to scrutinize the statements to pinpoint trouble spots, leaving in-house accountants to follow up.
The additional scrutiny is designed to ferret out everything from overspending to malfeasance, which was the case at another LAUSD charter, New Academy Canoga Park in the San Fernando Valley, where the school's board alerted district officials to possible wrongdoing.
A subsequent district audit found $3 million unaccounted for from 2007 to 2009. Principal Edward Fiszer was sentenced to five years in prison last December after pleading guilty to embezzling $1.4 million to play the stock market. The school was allowed to remain open after adopting a series of financial safeguards.
Some problems are difficult to detect. At Crescendo Schools last year, the then-executive director instructed principals at six schools to show teachers state standardized tests, give students quizzes based on test questions and deny seeing the test if asked. Two teachers called the district to report the cheating, which led the state to invalidate the schools' 2010 scores.
After moving to shut down the six schools, the district pulled back after the responsible administrators were removed and other reforms put in place.
Experts note that traditional schools run into misconduct and other problems, too, but say charters are held more accountable.
"Bad charter schools are easier to shut down," said Robin Lake, associate director of the University of Washington's Center on Reinventing Public Education. "With bad traditional schools, it's just assumed they'll go on into perpetuity."
Still, closures are politically difficult with school boards and other authorizers facing hordes of anxious parents pleading to keep their school open.
"It's not particularly easy. Closure is a very blunt instrument," said Hudnut. "These are parents who believe in their students. It's very, very personal for them, but they often have little idea of what we're dealing with."
Crescendo parents, who erupted in loud applause and cries of "amen" when district Superintendent John Deasy recently announced that the schools would most likely remain open, saw the test cheating as a separate issue from their kids' education.
"It was wrong," said parent Neal of the cheating. "But my daughter is learning the piano. She has dance and singing, all kinds of things. I was really hoping the school would stay open. We need that school."

Friday, June 24, 2011

Former Boulder education charity bookkeeper Diana Lewis sentenced to six years for embezzlement in Colorado


The bookkeeper who stole almost $180,000 from an education charity in Boulder was sentenced to six years in prison on Friday.

Diana Lynn Lewis, 44, will also serve three years of mandatory parole for one count of felony theft after a sentencing hearing that featured emotional testimony from the CEO of Impact on Education, the nonprofit that Lewis embezzled from.
In her ruling, Judge Gwyneth Whalen cited the amount of money and the length of time over which the embezzling occurred as reasons for the sentence.
"In times of budget cuts to education, the district relies even more on the goodwill of the community," Whalen said. "That goodwill has been irreparably damaged."
Whalen also noted Lewis' previous conviction for stealing from an Alzheimer's facility meant she had to overlook the numerous letters of support from family and even some old work supervisors who said Lewis would "give the shirt off her back to anyone."
Lewis forged several checks a year to herself and family members worth approximately $178,000 from 2004 to 2010. She would then cut and paste bank statements and input false information in the organization's online accounting system to cover her tracks.
The CEO of Impact on Education, Fran Ryan, told the judge that they suspect Lewis stole even more money from the nonprofit, including silent auction items and even coins from a lemonade stand that students had donated.
"I worked three months of additional time to clean up this mess," said Ryan, who added that she has already had donors tell her they were no longer giving money to Impact on Education because of the incident. "I've cried about this. I'm crying now. I haven't seen any tears from Mrs. Lewis."
Lewis did shed tears while apologizing in brief remarks to the organization, as did her family members in attendance when the sentence was announced.
"She worked for Impact on Education, and the impact on education she chose to have was to put $178,000 in her own pocket," Assistant District Attorney Christopher Zenisek said at the hearing. "She had her opportunity to make good, and she failed."
The District Attorney's Office had been seeking eight years, but Zenisek said he felt the sentence was "appropriate."

Thursday, June 23, 2011

School Official Ordered to Repay Embezzled Funds in California


A former Los Angeles Unified School District (LAUSD) administrative assistant who admitted to misappropriating public funds from Halldale Elementary School and the school’s PTA was ordered to pay more than $116,000 in restitution, the Los Angeles County District Attorney’s office has announced.
Deputy District Attorney Gary Nielsen, with the Public Integrity Division, said Lisa Ann Castro, 47, was ordered to pay $93,400 to the LAUSD, and $23,000 to Halldale Elementary School.
Castro pleaded guilty on Feb. 3 to one count of misappropriation of public funds, and was sentenced to two years in state prison. In 2005, shortly after being assigned to the school, Castro was given responsibility for two school accounts and was also made treasurer of the PTA and given access to its checking account. She pleaded guilty to stealing from all three accounts between June 2005 and September 2009, and taking the money for personal use. As part of the plea negotiation, prosecutors dismissed three counts of embezzlement and four counts of forging signatures on more than 100 checks, using the names of two different principals and two PTA officials.

Man sentenced for embezzlement in Georgia


For two years, Bernard Walker used fraudulently obtained checks to buy cars -- a Jaguar, a Cadillac, an Audi, a BMW -- then pocketed the extra cash he got back.

He covered his trail in different ways, including writing himself a check out of a church's bank account, but he couldn't escape scrutiny indefinitely.
On Thursday, Walker was sentenced to 33 months in prison, plus three years of supervised release, for embezzling money intended to pay for the meals and snacks of low-income children attending day care centers in 11 Georgia counties. He had been indicted on the federal charges Oct. 14.
Walker had access to the money as the nutrition specialist for the Central Savannah River Area Economic Opportunity Authority, which has headquarters on Greene Street. He worked at the organization for more than 10 years.
"We had no reason to suspect (he was embezzling money)," said Gloria Lewis, the executive director. "He built up a trust as he did his work."
Walker pleaded guilty through a plea bargain three months after his indictment.
"Stealing taxpayers' money that was allocated to buying meals for our children is reprehensible," U.S. Attorney Edward J. Tarver said.
The indictment shows Walker obtained the authority's checks by submitting false invoices from nonexistent vendors. He then used those checks to purchase six vehicles at Top Quality Auto in Waynesboro, Ga., including luxury cars, a Ford Mustang and a Ford Expedition.
In those instances, he gave the dealership checks in excess of the purchasing price and pocketed a check in return. The largest amount he received back was $10,196.44, the indictment showed.
He also bought a $475 rug at Goldberg's Furniture with a $4,634 check and got $4,158 back. In a separate incident, Walker deposited a $4,634 authority check into the bank account of Thankful Baptist Church in Waynesboro, then wrote a check to himself from the church's bank account for $4,632, the indictment stated.
Lewis said new safeguards have been put into place to prevent future theft, but she declined to give specifics. She added that there are policies in place that allow employees to report suspicious behavior without the fear of retaliation.
"We put a lot of trust in (Walker) as an employee, and he just didn't follow through," Lewis said.

Curfew for ex-school board official in Canada


A former Surrey School District associate superintendent who stole thousands of dollars from his employer was given a conditional sentence Monday in B.C. Provincial Court.
Robert Chadwick, 63, pleaded guilty on June 10 to breach of trust by a public officer. Chadwick and his wife Barbara, who was his administrative assistant, were also charged with fraud and theft over $5,000, but those charges were stayed.
According to an agreed-upon statement of facts, between July 2001 and June 2003 Robert Chadwick, who was an associate superintendent for six years, was responsible for the financial management of a contract the school district had with San Diego State University for use of district facilities.
Chadwick put payments totalling $416,000 into an external account he set up. Of that amount, $25,000 went to the school district. Most of the remaining money was used legitimately, but almost $44,000 was not.
The irregularities were discovered after a 2006 internal audit and a hearing was ordered, but Chadwick and his wife resigned before the hearing took place. They were criminally charged in July 2010.
In 2009, the district filed a civil suit against the couple, claiming they transferred more than $167,689.32 of district funds into a separate, unaudited account.
The Chadwicks settled the civil suit out of court in March, agreeing to pay the school board $78,000 to cover the $44,000 they took and costs incurred by the district.
In his decision, Judge James Bahen said an 18-month conditional sentence was appropriate partly because Chadwick has no prior criminal record and is not a danger to the community, nor is he a risk to reoffend.
Chadwick has paid the full amount owed in the civil court decision, pleaded guilty and, according to Bahen, expressed remorse.
Bahen said the offence is "clearly inconsistent with [Chadwick's] previous career and personal achievements."
The conditional sentence includes a curfew from 8 p.m. to 6 a.m. for the first four months.

PTAs looking at financial controls


Embezzlement charges directed against two area women active in parent support organizations that strive to better education underscore the financial vulnerability of volunteer groups when safeguards are lacking or neglected, experts said.

Deputies in New Hanover and Brunswick counties drew warrants earlier this month, accusing the women affiliated with the Sunset Park Elementary PTA and the Lincoln Elementary PTO with stealing thousands of dollars from their groups. Though filed within a day of each other, authorities say the cases are unrelated.
The allegations raised questions about the strengthening of financial protections in an era where experts have noted an anecdotal rise in white-collar crimes. Those interviewed in the past week believe the upswing is at least partially attributable to economic hardship.
Authorities charged Dana Leigh Brooks, 38, with 12 counts of embezzlement over accusations she stole more than $5,000 from Lincoln’s PTO between February and June. She came to the attention of authorities after the group received multiple complaints from parents concerning a recent fundraiser where ordered items were never delivered. Sgt. April Stanley, a spokeswoman for the Brunswick County Sheriff’s Office, said that when the funds were examined, it was discovered the goods were never paid for and there was a discrepancy in the finances.
A day earlier, deputies charged April Ann Powell, who resigned as president of Sunset Park’s PTA in December, with one count of embezzlement after evidence suggested she allegedly used the group’s money to pay off her personal debts during the latter part of 2010. Cpl. Jerry Brewer, a spokesman for the New Hanover County Sheriff’s Office, said he could not confirm the precise amount involved but did say it was thousands. Contacted last week via phone, Powell, 34, declined to comment on the case.

Since news about the alleged embezzlement schemes emerged earlier this month, questions have swirled over whether financial safeguards are strong enough.
Two officials with the New Hanover County Council of PTAs, which supports the network of local groups, said the system in place is adequately designed to provide financial oversight. The issue, they said, was PTA groups have been allowed to amend their bylaws, and there exists no authority to ensure that policies and procedures are being followed correctly. Part of that is about to change, though.
Council President Denise Szaloky said the Sunset Park episode has prompted other groups to evaluate their policies and strengthen their financial protections. Soon, she said, all the groups in North Carolina are expected to adopt uniform bylaws to increase financial oversight and bolster other controls–a move proposed last year.
“If you follow your bylaws … there are procedures in place that would not allow this to happen,” said Gina Baran, the council’s treasurer. “This is something that should not occur.” In addition to the obvious fiscal impacts, exposure to theft can make it more difficult for donation-reliant nonprofits like parent-teacher associations to raise money.
“It makes your next fundraiser that much more difficult because people question the seriousness of the group in protecting its money,” said Tim Sullivan, founder and president of PTO Today, which helps parents form support organizations at local schools. “It stinks when you’re putting sweat and energy into a good cause and suddenly people are talking negatively about it.”
While PTAs and PTOs differ in their affiliations and organizational structure, both work to better education by providing everything from classroom supplies to playground equipment. Though affiliated with a certain school, the groups function independently and rely on private donations. Nevertheless, with government belt-tightening obliging school districts to pare back their budgets, schools have grown more reliant on parent support groups to sustain traditional education levels.

Crime experts agree that fraud is not unique to PTAs and PTOs. Indeed, news reports from around the country show the prospect of volunteers diverting money for personal gain is nothing new. And though many say the proportion of nonprofits that actually fall victim is miniscule, white-collar crimes have certainly increased in scope and frequency during the economic downturn.
In Bedford, Va., for example, authorities charged three people in 2009 – including the fire chief – with looting more than $150,000 from a volunteer fire company. In another case, a volunteer and two former employees at a catholic church in Danville, Calif. were arrested last year on suspicion of embezzling nearly $600,000 from the religious institution, according to Associated Press reports.
While the problem might be relatively small compared to the number of organizations in existence – one expert noted as many as 1.5 million nonprofits nationwide – some insiders contend that press coverage makes it appear worse and often taints the industry’s reputation.
James Martinez, a spokesman for the National PTA, said the advocacy group does not track the number of times these kinds of allegations arise but does monitor media reports and believes only a “handful” are ever exposed.
“Parents groups in general do great things but unfortunately, this happens, but it doesn’t happen all the time,” he said, speaking on the two recent cases in Southeastern North Carolina. “Corruption, which is what it is, happens on every level of any system around the world.”

The Relationship Between Embezzlement Cases And Gambling


A Saint Joseph man was sentenced to one year in jail this week for embezzling thousands of dollars from his church. 46 year old Jon Ruppel was also ordered to pay about 192 thousand dollars in restitution to Saint Peter's United Church of Christ, and serve five years of probation. According to the Herald Palladium, the judge indicated in court that Ruppel's crimes were in part due to a gambling problem and casino visits, which raises a question -- how many of the embezzlement cases we've seen lately are due to the same addiction? Patrick Witri, President of the Michigan Association on Problem Gambling, tells us that just having a casino nearby won't necessarily drive someone into that sort of compulsive behavior, in and of itself:

Wednesday, June 15, 2011

Ex-bookkeeper guilty in church embezzlement in Massachusetts


A former employee of St. Mary Magdalen Parish in Tyngsboro has pleaded guilty to skimming tens of thousands of dollars from Sunday Mass collections, including donations to the poor.

The parish's pastor, the Rev. Ron St. Pierre, said the thefts may have delayed the church's push to build a new church.
Former St. Mary Magdalen bookkeeper Donna Rood, 47, of Tyngsboro, pleaded guilty in Middlesex Superior Court Friday to charges of embezzlement over $250 and making false entries into corporate books.
Judge S. Jane Haggerty sentenced Rood to five years probation, during which she must pay $90,000 in restitution.
Rev. St. Pierre said the thefts occurred just as the church was amid a capital campaign to build a new parish center.
"If we had known how much money we really did have, we may have started building a new church sooner," he said last night.
Asked if he is disappointed Rood did not receive jail time, St. Pierre said the DA's office had indicated it would request jail time, but that the parish left the decision on sentencing up to the court system.
"We are surprised there is no time being served. It was a very large sum," St. Pierre said. "But we left that to the courts to decide."
"By pleading guilty, this defendant has admitted to stealing monetary donations that were intended for the needs of her church and community, violating the trust bestowed upon her as an employee of this church," Middlesex District Attorney
Gerard Leone said. "This defendant has now accepted responsibility for her illegal actions and will be required to repay the stolen funds."

St. Pierre first noticed a discrepancy in May 2009 when he counted the day's offering from the congregation one Sunday and there was $127. The following day, when Rood, a six-year church employee, entered the receipts into the church's books there was only $97.
The following week, the priest and several parishioners again counted the offering, and once again Rood entered a smaller amount in the church's books, according to prosecutors.
In early June 2009, after St. Pierre confronted Rood about the discrepancies in her counting, she was fired.
According to prosecutors, Rood had access to the cash and books at the Tyngsboro church from 2003 until June 2009. Her responsibilities included counting the charitable donations during the three Sunday Masses.
Donations were made in both check and cash form, and included donations to the building fund, which served to maintain the church grounds; the "candle money," which was collected from individuals making votive offerings; and donations to the Society of St. Vincent DePaul, a Catholic charity committed to helping the poor.
When investigators reviewed Rood's personal bank records, they discovered a striking pattern of cash deposits, as much as $1,500 at a time, immediately after Sunday services. Rood allegedly could not explain the missing cash.
St. Pierre said Rood had been a longtime member of the church community.
"I think people were saddened by it," he said of the theft. "It's been a betrayal of trust. And Donna Rood knows many people in this town and this area."

Aug. 9 trial set for former school librarian in California


An Aug. 9 trial date was confirmed Monday in Shasta County Superior Court for a Redding School District librarian accused of embezzling and stealing from a school parent club.

A settlement conference that afternoon for Wanell Stolz, 52, the wife of the school district's former board president, Rein Stolz, failed to resolve the case, but attorneys are continuing to seek a negotiated settlement.
Stolz, who has pleaded not guilty, is accused of stealing approximately $13,500 of cash and property from Sycamore School and the Parent Faculty Club at the school from 2004 to 2009.
Redding police have said that Stolz, arrested on Aug. 4 at her home, wrote more than 80 checks to herself and her husband from the club's account.
She also allegedly stole a digital camera, stacks of books and used the club's account to buy enough ink cartridges to print close to 3,000 pages on her homes computer, police have said.
Redding police arrested Stolz on Aug. 4 at her home on suspicion of theft and embezzlement, and her husband resigned from the school board later that month.
After her arrest, school district employees claimed Stolz received preferential treatment because her husband was president of the board, and Sycamore Principal Lana Rylee filed a claim against the district maintaining she suffered retaliation for giving Wanell Stolz a critical evaluation and reporting possible criminal activities to authorities.

The claim is a precursor to a lawsuit, but electronic Superior Court records show that a lawsuit has not been filed.

Church bookkeeper embezzles $13,000 from St. Bernadette in Michigan


Myrna Lee Watters was responsible for monitoring the financial accounts at St. Bernadette of Lourdes Catholic Church.

Instead, the bookkeeper embezzled thousands of dollars in funds from the church located at 991 E. Main St. in Stanton.
Watters, 57, of Vestaburg, recently pleaded guilty to a reduced charge of attempted embezzlement by an agent of $1,000 or more but less than $20,000.
She has a plea agreement with the Montcalm County Prosecutor's Office for 10 days in jail and $13,000 restitution.
An audit of the church books revealed $13,000 had gone missing between 2005 and 2009. Watters signed church funds over to herself via checks and put them into her bank account.
The funds have not been recovered.
Church officials did not return calls seeking comment.
Watters remains out of jail until she is sentenced at a later date.

Monday, June 13, 2011

Church rocked by allegation of theft in Indiana


Apparently, 44-year-old Beth Boger had quite a good scheme going.

For nearly five years, according to court documents, Boger, the bookkeeper for St. Joseph Catholic Church in Garrett, used the church’s funds to support her own lifestyle, taking more than $364,000 for herself from June 2004 to April 2009.
In May, a U.S. District Court grand jury in South Bend indicted the Garrett woman on 10 counts, ranging from wire fraud to tax evasion.
Like any business or non-profit, churches are not immune to internal thefts and embezzlement, something that may have gotten worse as the economy went sour. And like a business, churches need to protect themselves from such crimes, experts said.
If victimized, the churches must work to regain the trust of their congregation, as well as replacing what was taken.
Last week, Boger, a demure woman with glasses and short auburn hair, appeared before U.S. District Magistrate Judge Roger Cosbey in Fort Wayne for an initial hearing on the charges, which could put her behind bars for years.
A plea of not guilty was entered on her behalf and she remains free on bond.
Attempts to contact her were unsuccessful.
The Roman Catholic Diocese of Fort Wayne-South Bend remains tight-lipped about Boger’s alleged thefts because of the ongoing investigation and pending trial.
But court documents detail Boger’s alleged scheme to defraud the church through her access to its books, making money look as if it went anywhere but to her personal account.

Accents by Beth
According to the federal indictment, Boger owned a business called Accents by Beth.
Beginning June 3, 2004, Boger wrote checks to her business, drawn on the checking account of St. Joseph Catholic Church in Garrett.
She would then deposit that check into her business account and, a few days later, transfer the money into her personal checking account, according to court documents.
That money would then be used to support her household and lifestyle, though court documents offer no specific examples.
But the church never knew the checks went to Accents by Beth, according to court documents.
Instead, Boger would show in the church’s books that the money paid expenses for the St. Martin’s Clinic, a local non-profit.
And then, when the cleared checks were returned from the bank to the church, Boger would alter the payee from Accents by Beth to a vendor used by the church, according to court documents.
In 2006, Boger’s scheme pulled in $96,245. In 2008, it was $69,825, according to court documents.
The indictments allege not only the wire fraud with the checks but also evading the payment of income taxes.
Because she reported that she and her husband made only $7,788 in income for 2006, they owed no income taxes.
But when federal investigators took into account the funds Boger allegedly embezzled that year, the family actually had taxable income of $104,033, according to court documents.

Churches are by their nature trusting places and may not have sufficient controls in place to guard their finances.
In early 2009, a former employee of Lakeview Wesleyan Church in Marion was charged with stealing more than $275,000 from the church, where he was director of finances.
William Jeremiah Six, 28 at the time, used the money to pay for motorcycles, cars and a vasectomy, according to court documents.
He was eventually convicted of two counts of theft and given a largely suspended prison sentence, court officials said.
And members of the church were left to pick up the pieces.
According to Mike Bonner, the large Grant County church has put most of what happened behind it, and Six is still reimbursing the church for what he took.
“We thought things were going fine,” said Bonner, a leader in the church.
Six was responsible for three ministry units within the church and the finances of each one, Bonner said.
The church operates many ministries, including a school and a counseling center.
Six would present fabricated financial reports to church administrators to conceal his thefts, Bonner said.
The church discovered Six’s theft through anomalous W-2 forms containing incorrect information.
When church officials confronted Six, the rest of the fraud came out, Bonner said.
Bonner said the betrayal of trust may dig a little deeper for a congregation than it would a typical business because within a church family there is a stronger expectation that trust won’t be broken.
After the thefts were discovered, Lakeview Wesleyan staff worked with accountants to help hone the church’s policies and procedures, recognizing that the complex ministry lent itself to fraud, Bonner said.
Each ministry unit had its own system of accounting, and now they all have one.
We have survived,” Bonner said.

Protecting assets

Fort Wayne-based Brotherhood Mutual Insurance specializes in church insurance.
“We feel very much a mission not to just insure them, but to help them protect their people, property and reputation,” said Mitzi Thomas, assistant vice president of marketing and communications.
Because thefts within a church damage its reputation in a community, the company has seen an increase in interest in Brotherhood Mutual’s resources on how to prevent such activities, Thomas said.
In conjunction with Christianity Today, an Evangelical Christian magazine, Brotherhood Mutual launched a website – – to help churches protect themselves.
Within the past year, articles about embezzlement and financial security have been among the most viewed on the site, Thomas said.
“People who would never consider putting their hand in the plate are driven by job loss to do that,” she said. “I think the economy has a big thing to do with this.”
It can take church officials awhile to discover they’ve been victimized and then to confront the offender, Thomas said.
“Churches have so much on their plates,” she said. “They want to be trusting, and most churches consider themselves a community.
“One of the last things you want to do is to think badly about someone you care about.”

Leland, NC woman wanted for embezzlement


Brunswick County Sheriff’s Office Detectives are searching for a local woman from the Leland community that was involved in an embezzlement incident.

Dana Leigh Brooks, Treasurer of Lincoln Primary School PTO, is wanted for twelve counts of embezzlement. Brooks embezzled over $5,000 from the PTO from February of 2011 to date. The funds varied from PTO fundraisers and local contributions, which were used for supporting projects for the students of Lincoln Primary School.
Detective Ed Carter issued warrants for the arrest of Dana Leigh Brooks on 6-10-2011. Brooks’ last known address in the Leland community but she is possibly in the Wilmington area.

Ex-president of Elementary School's PTA charged with embezzlement in North Carolina


Deputies on Thursday charged the former president of Sunset Park Elementary School's Parent-Teacher Association with one count of embezzlement after an investigation uncovered evidence suggesting she allegedly used PTA money to pay her personal debts, officials said.

Authorities processed April Ann Powell, 34, through the New Han- over County jail about 3 p.m. She was released on a $7,500 unsecured bond about an hour later, deputies said.
Cpl. Jerry Brewer, a spokesman for the New Hanover County Sheriff's Office, confirmed the investigation and said detectives believed Powell embezzled money over a four-month period in 2010.
He said he did not know how much money was involved.
Denise Szaloky, president of the New Hanover County Council of PTAs, said Powell resigned from her post in December, and the role of Sunset Park PTA president has remained vacant ever since.
"PTA works to teach and train its volunteers on financial management and expects everyone to hold themselves and their work for children to the highest standards of ethical behavior," Szaloky said in a statement. "Hours of training are offered to the leaders from online instruction to various workshops throughout the year. Proper PTA procedures are currently being followed."
She added that the investigation was ongoing.
Tim Markley, the New Hanover County schools superintendent, said district administrators regretted that the incident happened but said it was a PTA issue.
PTAs and the county school system function as separate entities financially.
"This, in no way, reflects upon the great work the vast majority of our PTA/PTO folks do," he said. "In these tough budget times, PTA/PTOs have stepped in to be great partners. And we would not want one incident to tarnish the record of these groups."

Trust, volunteer Staff can make Booster Clubs vulnerable to theft


Last year, Bruce Bosman was working on plans to send his son and other members of the Riverview High School varsity football team to a camp when he got a call from the bank: The account used by the team's booster club didn't have enough money to cover the $2,100 cost.
"I said, 'That's impossible. We should have $28,000 to $30,000 in that account,'" said Bosman, the club president. They didn't. The account had about $1,800. The rest had been taken by the treasurer, who has pleaded guilty and agreed to repay $35,000.
Riverview was stung a second time when the president of its high school baseball boosters took money; he's to be sentenced this month. Other Metro Detroit athletic clubs, including groups in Livonia and Westland, have reported thefts, too.
Authorities say such groups can be especially vulnerable, since they're not regulated under state law and often have unpaid volunteers handling large sums of money from ticket sales and concession stands. "What organizations can do is make sure they're structured properly and make sure there are checks and balances," said Riverview Deputy Police Chief Clifford Rosebohm, who investigated both theft cases in his city. "Organizations have to operate with the idea of transparency."
School officials say boosters are an important contributor to athletic programs — raising money for trips, events, equipment and even uniforms. With education budgets shrinking and state aid drying up, they'll remain a vital support system for school sports teams, said Riverview Superintendent Dennis Desmarais.
But in the end, it's difficult to stop someone who's set on stealing, he said.
"Riverview probably has some of the best guidelines when it comes to boosters, but once again it's trust and someone took advantage of us," Desmarais said.
In Riverview, the theft from the football boosters led to embezzlement charges against Shelie Ann Gendron, the club treasurer. In a plea deal, Gendron was charged with embezzlement and is to finish repaying the $35,000 by August. She was accepted into Wayne County's diversion program about two months ago.
Gendron, who could not be reached for comment, could have her record expunged if she completes the program.
In the second case, involving Riverview's baseball boosters, ex-club president Alan Wade Benson pleaded guilty in May to larceny by conversion, more than $1,000 but less than $20,000.
In response, the school district made booster club finances more transparent and began doing background checks of club members who handle money.
Statistics aren't kept on embezzlement from athletic organizations, but police — citing the struggling economy — say it's happening more often now.
Brian Molloy, 38, of Farmington took more than $100,000 from a Livonia soccer club while serving as the nonprofit's treasurer. He pleaded no contest to embezzlement over $20,000 and was sentenced to two years' probation in February. He paid $87,000 in restitution.
Galen Huren Jr., 46, is charged with embezzling more than $20,000 from the Westland Youth Athletic organization, where he was president. He is free on $10,000 bond and awaits a preliminary exam Thursday.
How school districts oversee sports boosters varies widely.
"It's just not an area that schools have asked us to have any involvement in," said John Johnson, communications director for the Michigan High School Athletic Association. "Every district is a little bit different as far as their structure of how they handle their monies."
Now in Riverview, accounts are online, making it easier to track deposits and withdrawals. Carbon copies of transactions are given to a board member, the boosters' treasurer and Bosman. The club now does a background check on anybody involved with money. That would have weeded out Benson, who faces up to five years in prison when sentenced this month for larceny by conversion.
Benson, 49, absconded from parole in 2008. A felon, he spent three years behind bars for charges of false pretenses — fraud — and larceny by conversion of $20,000 or more.
Rosebohm, the Riverview police official, says a lack of oversight and access to money can tempt club officers to steal.
"They're not employees of the school district. They're not required to go through the background checks," Rosebohm said. Fred Smith, the athletic director for Buchanan Community Schools in Berrien County, agrees checks and balances are critical.
"This is the first year we've brought everything inside, and now everything is run through the school accounts," Smith said. "It's better this way. If you left a $20 bill on a counter, the temptation is there for someone to walk away with it. We have checks and balances when it comes to deposits. Everything is accounted for."
It's the loss of trust that really hurts, Bosman said. He remembers confronting Gendron after the funds went missing. "She looked right at me and said, 'I'm the most honest person you could meet. Stealing from you is like stealing from my own children.'"

Thursday, June 9, 2011

Alleged Charter School Embezzlement Investigated in Virginia


Patrick Henry School of Science and Arts (PHSSA), Richmond's first charter school, is releasing the following statement in regards to recent reports regarding the Richmond Public School (RPS)'s student activity fund used by PHSSA:

The PHSSA Board of Directors has been communicating with RPS administration continuously since February about the student activity fund. At the direction of the Board, PHSSA's independent accountant conducted an internal audit of the student activity fund, which was opened at an RPS bank, uses an RPS tax identification number, and was not under the control of the PHSSA Board or its Treasurer. Working collaboratively with PHSSA administration and staff, the accountant gathered all of the information available at the time and issued a report to the Board in late April.
In response to the findings of that audit and in keeping with its role as the governing body of PHSSA, the Board voted unanimously on May 3rd "to implement financial procedural controls for the student activity fund." These financial procedural controls were recommended by PHSSA's independent accountant and include: Procedures for teachers, staff and administration on collecting and recording lunch money; controls over meals served; and invoice reconciliation. These controls were put in place in addition to procedures and controls already in place that are outlined in the 129-page student activity fund procedures manual provided to the PHSSA administration by RPS when the account was originally opened.
The Board communicated the above findings and information to all involved parties, including the PHSSA and RPS administrations immediately after the PHSSA Board took action. Additionally, emails and phone calls were made to follow up on outstanding questions and requests were made to receive any audits or findings conducted by RPS. The Board continues to work with RPS to keep the lines of communication open and ensure that all accounts are managed in a financially responsible manner that is in the best interest of the school.
The Board has been notified of a state investigation regarding the student activities account. Although the Board did not initiative this investigation, it will cooperate fully with the authorities to show that it has been working proactively to collect and disseminate all information about this account to the appropriate parties.
PHSSA understands that fiduciary responsibility is an important responsibility for this school, which was founded not only on an innovative curriculum, but also on the basis of transparency and financial efficiency. In keeping with this responsibility, last year, PHSSA Board requested an independent audit of the PHSSA Board managed bank account. In March 2011, PHSSA released the finding of an independent audit conducted by the independent accounting firm of Goodman & Company. Their audit report stated:
"In our opinion, the financial statements [of PHSSA] present fairly, in all material respects, the financial position of Patrick Henry School of Science and Arts as of June 30, 2010, and the changes in its net assets and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America." According to the accompanying management letter, Goodman & Company did not "identify any deficiencies in internal control that we consider to be material weaknesses."
PHSSA will continue to work collaboratively with RPS Board and administration to ensure that as much information, as allowable by privacy laws, is conveyed to the Patrick Henry stakeholders, including parents, teachers, staff and volunteers. We thank everyone for their continuous support in helping bring educational opportunities to the city of Richmond and Commonwealth of Virginia.
Virginia State Police are investigating allegations of embezzlement involving Patrick Henry School of Science and Arts in Richmond.
The investigation stems from questions about the management of the charter school's student activity funds, controlled by the principal and Richmond Public Schools.
Richmond Schools spokesperson Felicia Cosby said an audit on the fund is already scheduled for August. Cosby said the school system did not know about the police investigation, but said the school board had previously raised concerns over Patrick Henry's financial stability.
No charges have been filed. The case remains under investigation.

Wednesday, June 8, 2011

Teacher charged with embezzlement in West Virginia


A Wirt County teacher and coach has been charged with embezzlement.

Last month, West Virginia State Police arrested Christine Wilson of Washington for embezzlement. Wilson, who served as treasurer of a band boosters club, is alleged to have taken almost $9,000.
The 39-year-old was arrested May 6 by the Wirt County detachment of the West Virginia State Police. Sgt. C.E. Boring is the investigating officer.
According to the criminal complaint, Wilson took over duties as treasurer for the Wirt County Band Boosters in July and held the post until February. Boring states he received information from the Wirt County Board of Education regarding discrepancies in the boosters' account.
"The band booster accounts were audited by Wirt County Board of Education Treasurer Karen S. Cummings," the complaint states. "Ms. Cummings provided (Boring) with a report which advised there was a potential loss of $8,890 from the band booster account."
In the complaint, Boring stated he met with Wilson who admitted to taking $3,600 from the money collected by the Wirt County Band Boosters.
Wilson was charged with embezzlement and released on $2,500 surety bond. Her preliminary hearing is set for June 13 before Wirt County Magistrate C. David Roberts. Wilson's attorney is William Summers.
If convicted, Wilson faces a minimum of 10 years in prison.
Wilson, a teacher at the Wirt County Primary Center, also serves as the high school softball coach.
Wirt County Superintendent of Schools Dan Metz declined to comment on the arrest, citing personnel issues. Metz did say the teacher has been suspended pending the outcome of investigation.

Sunday, June 5, 2011

Ex-University of South Carolina accountant has yet to face sentencing in $179,000 theft


Last December, former University of South Carolina accountant Lawrence “Trey” Godwin III pleaded guilty in a Richland County courtroom to stealing some $179,000 from USC during 2006 and 2006.

Now, almost six months after his guilty plea, Godwin, 35, of Camden, still has not been sentenced to either a prison term or probation.
No official — not Circuit Judge Casey Manning, who accepted the guilty plea, nor 5th Circuit Solicitor Dan Johnson, whose office is prosecuting the case — will give a reason for the delay.
Efforts to reach Godwin’s attorney, Melissa Armstrong, were unsuccessful.
USC, the victim in the case, released a statement saying Godwin had made restitution in the amount of $59,157 following his guilty plea. The university turned that amount over to its insurance company, which earlier had paid the school $124,798 as partial compensation for the missing money.
USC said in its statement that Goodwin’s partial restitution “effectively” ends” university involvement in this matter. To discuss his status further is not appropriate because we’re not privy to all the facts that the judge would have in determining the proper sentence,” the statement said.
Manning gave no indication of when he intends to sentence Godwin. Normally, convicted criminals in South Carolina who plead guilty to felonies, as Godwin did, are sentenced sooner.
In any event, the six-month sentencing delay is just one more delay in a seemingly straightforward case marked by years of delay.
Five years ago, in July 2006, Godwin was arrested by USC detectives and charged with breach of trust with fraudulent intent, embezzlement and credit card misuse.
Once a trusted accountant, Godwin had looted cash machines at the university that he was supposed to be tending and then falsified cash reports to cover up his crimes, according to warrants in the case.
A routine audit turned up the discrepancies, which took place between July 2005 and July 2006. Goodwin, who had worked at USC since February 2002, also was caught on a surveillance camera. Confronted, he confessed and admitted his guilt to officers, according to warrants.
Despite the evidence, his case fell into limbo.
Prosecutors said a succession of defense and prosecution attorneys were assigned to the case, making a speedy prosecution difficult.
Last year, after The State began looking into the continued inaction on the case, prosecutors scheduled a plea hearing.
Godwin pleaded guilty Dec. 14 to stealing some $179,000 from the university to support a heroin habit, he told the court, apologizing.
At the time, Manning said he would delay sentencing until he learned that restitution had been paid.
Godwin could receive a sentence of up to 20 years.

Saturday, June 4, 2011

Former Drake staffer pleads not guilty in embezzlement case in Iowa


A former Drake University employee accused of embezzling more than $470,000 pleaded not guilty during an arraignment at the Polk County Court House Friday morning.
The state charged Robert A. Harlan with five counts of fist-degree theft in connection with the alleged embezzlement. Harlan pleaded not guilty to all five charges.

A pre-trial conference for Harlan is scheduled for July 7 at 1:30 p.m. He is set to go to trial, pending that conference, on August 1.
Harlan’s attorney Tim McCarthy said he plans to review trial information, then decide where to go from there.
Harlan worked for Drake University for more than 20 years, and for the past 10 years held the position as director of student accounts. Police said Harlan was charged with five counts of first-degree theft for each of the five years he was allegedly embezzling funds. All five charges are Class C Felonies, punishable with a 10 year prison sentence for each count.
The embezzlement dates back to 2004, but the official investigation goes back five years, police said.
Officers said Drake officials asked for an audit when it became apparent there was a shortage. The audit determined how much money was allegedly taken.

Thursday, June 2, 2011

DA will look into embezzlement charges in Gilroy, California


The Santa Clara County District Attorney's Office will take a close look at embezzlement charges leveled at Gilroy Unified School Board trustee Francisco Dominguez.

John Chase, Deputy District Attorney with the Public Integrity Unit, said Wednesday the district attorney's office will be "finding out what the details are."
"I read the story (in The Dispatch) and knew immediately that we were at least going to figure out what's going on," he said.
On Tuesday, the Gilroy Foundation Board sent a strongly worded letter to the South County Collaborative Board, severing a $70,000 grant it obtained to assist the Collaborative and kicking the agency out of shared office space. Those actions followed an unanimous no-confidence vote taken by the 12-member Gilroy Foundation Board that was directed at the South County Collaborative Board.
"The Gilroy Foundation has positioned itself as an example of community wellness and integrity. The lack of legal reporting of the missing money shows a lack of judgment by an agency that was a victim but now appears to be covering up a misdeed. The Gilroy Foundation believes in transparency among our partners, and unfortunately this trust has been violated," wrote John Perales, Gilroy Foundation president and principal of Christopher High School, in a formal letter that was emailed Tuesday morning to the Collaborative.
The Foundation Board very strongly believes, Perales said, that the South County Collaborative Board should have turned to law enforcement after well-known local accountant John Blaettler - who was serving as treasurer for the South County Collaborative at the time - laid out what he called a "systematic" embezzlement by Dominguez.
Blaettler said the evidence showed Dominguez, through his firm DZ Consulting, "stole" $52,629 while managing federal grant money for the South County Collaborative.
This figure transposes a South County Collaborative balance sheet obtained by The Dispatch dated April 5, 2011. A line item lists "total accounts receivable" as $52,629.
As of June 15, the Gilroy Foundation will ax the $70,000 grant. Currently the money funds two-thirds of the Collaborative's Strategic Director/CEO position, including a laptop computer and office space at Gilroy Foundation's headquarters at 60 Fourth St., according to Perales.
"We feel that we can't support their board if they will not take the appropriate actions, given the situation they're in with the contractor possibly embezzling money," Perales said over the phone Tuesday. "At this point we don't feel that we can continue, given their actions - or, inaction, I guess."
All of this follows what Dominguez described as a "billing dispute," which arose after he was hired by the South County Collaborative in September 2008 to manage a five-year, $125,000-per-year federal Drug Free Communities grant that was renewable annually.
During this time, Blaettler, who resigned as South County Collaborative's treasurer March 25, said Dominguez systematically overbilled the agency by $52,629.
During an hourlong interview last week, South County Collaborative Chairwoman Lynn Magruder, who is employed as a grants administrator for the human services agency Community Solutions, repeatedly declined to name Francisco Dominguez or DZ Consulting as the contractor. Nor would she acknowledge the $52,629 figure, referring to it instead as "the disputed amount."
However, on a South County Collaborative balance sheet obtained by The Dispatch dated April 5, 2011, a line item lists "total accounts receivable" as $52,629. Furthermore, in minutes obtained by The Dispatch from a Nov. 4 2010 South County Collaborative Board of Directors meeting held at the Gilroy Library, under board action it states, "The Board voted not to renew the contract with DZ Consulting for year three of the Drug Free Communities project." Magruder is listed as present and the action to not renew with DZ Consulting passed 9-0 with three board members absent.
Blaettler said he resigned as treasurer after the South County Collaborative, led by Magruder, declined to bring the matter to the attention of law enforcement agencies and, alternately, reached a civil agreement with Dominguez to pay back more than $52,000 to the agency.
The Gilroy Foundation has publicly backed Blaettler's calls for transparency and a thorough investigation.
On May 24, Perales said the Foundation's 12-member board discussed terminating the $70,000 grant. The money came from the Silicon Valley Community Foundation - a philanthropic organization in San Mateo and Santa Clara counties - and was specifically applied for by the Gilroy Foundation with the intention of administering the money to the Collaborative, according to Donna Pray, the Foundation's executive director.
The decision to cut off monetary support was unanimously solidified in the past few days, according to Perales.
"We are saddened that our support of the Collaborative has been compromised by the decisions made by the SCC's Board regarding the missing funds taken by their former independent contractor," he wrote.
When asked Wednesday how she felt about the Foundation Board's decision, Magruder replied "I think anyone would be sad and disappointed."
Magruder said the South County Collaborative has left the door open on the question of whether it would seek law enforcement's involvement, saying "we haven't made that decision yet," but acknowledged the topic is not on the meeting agenda for South County Collaborative's Thursday board meeting.
Magruder did say "we've discussed the situation with our Drug Free Communities grant makers, and they're investigating it and will issue a finding."
Magruder explained the DFC grant makers are a part of the federal government substance abuse and mental health services agency.
During an interview last week, Blaettler - a former Gilroy Foundation board member - described the relationship between the Gilroy Foundation and South County Collaborative prior to this issue as "great." Because of this, he wanted to act as a liaison between the two by sitting on the Collaborative's board which led to him becoming the South County Collaborative's volunteer treasurer.
After repeatedly requesting and eventually obtaining the South County Collaborative's financial data from Dominguez and analyzing it, however, Blaettler said he noticed "inaccuracies" as billings submitted by Dominguez exceeded what was allocated to his contract.
Blaettler presented these findings to the South County Collaborative Board of Directors in November 2010, but became frustrated with "a lack of accountability." He submitted a resignation letter dated March 25, writing he did not want to be party to a decision that allowed Dominguez to "get away with criminal behavior by simply allowing him to return the $52,269 he stole."
Perales reiterated this viewpoint Tuesday, saying the Gilroy Foundation would "love to continue" its relationship with the Collaborative and work on rebuilding trust, but "most importantly, we feel as a board we can't support an organization where their board, we feel, is not taking the appropriate action."
On Wednesday, Deputy District Attorney Chase said he has been in contact with Blaettler, who is on vacation. He said he will speak to Blaettler when he returns. Chase said regardless of whether the South County Collaborative files a complaint, the district attorney's office has the authority to file a case.
GUSD school board members Jaime Rosso and Tom Bundros said they expect to see Dominguez at the June 2 school board meeting at 7810 Arroyo Circle. Neither commented extensively on the embezzlement accusations, but said their colleague was an "outstanding board member" and "great public servant for the schools."
"He's a personal friend, and it seems it would be completely out of character in my mind, so it's really hard for me to accept the accusations," Rosso said.
As for the Collaborative Strategic Director/CEO - the agency's only paid position - Pray said Elena Ruiz-Thomas holds this position but is not sure if Ruiz-Thomas's job will be eliminated entirely.
The $70,000 grant covers 75 percent of Ruiz-Thomas's salary, while "the SCC has other funds to pay the rest," Pray said.
"I don't know anything about (the Collaborative's) financial situation and they may have the money to continue to employ her," Pray said, noting the Gilroy Foundation is just pulling monetary backing on their end.
South County Collaborative Chairwoman Magruder said the Board will "do everything in their power" to sustain the position.

School bus supervisor guilty of embezzlement in West Virginia


A former Kanawha County school bus supervisor admitted Tuesday to logging fake overtime hours for employees, pocketing the excess cash and often using it pay off balances on a family member's Mary Kay cosmetics account.

Nancy Bowen-Kerr, 58, who headed the Elkview school bus terminal from at least 1998 until her resignation in 2007, pleaded guilty before circuit Judge Jennifer Bailey to a felony embezzlement charge.
In 2007, sheriff's deputies began a criminal probe into several overtime violations reported at Bowen-Kerr's terminal. Police found that the supervisor gave her employees overtime hours they never worked so that they could pay her back for Mary Kay products they purchased from one of her family members.
Bowen-Kerr also skimmed some of the pay gained from the phantom overtime hours. Sometimes, she cut the profits with other employees, Kanawha County assistant prosecutor Rob Schulenberg said.
School officials became aware of the dealings after some employees at the bus terminal complained to school board members, board President Pete Thaw said, adding that at one point he visited the terminal personally and saw hundreds of Mary Kay products stacked at least 6 feet high.
In exchange for Tuesday's plea, prosecutors recommended that Bowen-Kerr serve her sentence on a mix of home confinement and probation, which Thaw decried as a "bargain" and said he hoped for a stiffer penalty.
"You have no idea what a bad example this sets for other employees," Thaw said. "We've tried for years to get something done. If this doesn't merit jail time, then what does?"
An embezzlement conviction generally carries a sentence of one to 10 years, or an alternative sentence of up to a year in prison and a $2,500 fine.

Bowen-Kerr also faces almost $60,000 in restitution, but Thaw was not sure if that amount is an accurate reflection of how much she embezzled during her time as a supervisor. Thaw also did not know exactly how long Bowen-Kerr has been employed at the school district, but said she was working there in 1998, when he was elected to the board.
Workers at the Elkview terminal have been complaining to him about her ever since, he said.
Prosecuting Attorney Mark Plants said the reasoning for the recommendation of home confinement for Bowen-Kerr was twofold: It assured a conviction, and it assured that the 58-year-old would be able to stay in the work force and pay off her restitution.
"Ultimately, the judge decides what the punishment will be," Plants said. "We, of course, will make recommendations pursuant to the plea agreements, and we make plea agreements based on the evidence of the case."
Thaw said that though he does not agree with the deal, he's happy that the case has finally moved forward, after being backlogged under a previous prosecuting attorney's administration.
"This will send a message badly needed for a long time," he said. "Half a loaf of bread is better than none if you're hungry."

Wednesday, June 1, 2011

Man Pleads Guilty In South Dakota Baseball Camp Scam


A man accused of promoting a bogus baseball camp in South Dakota has pleaded guilty to grand theft by embezzlement.

Thirty-five-year-old Jason Anderson faces up to 20 years in prison and up to $40,000 in fines when he is sentenced on June 27.
Authorities say Anderson collected more than $20,000 from Rapid City parents last year for a baseball camp that never happened. He says he spent the money on drugs and gambling.

More than a year ago, Anderson, 35, persuaded area parents to pay him over $20,000 to give their children a spot on his traveling baseball team. The team was sold as an opportunity to give young players a chance to meet pro baseball players and increase their exposure. No team, however, was ever created, and Anderson disappeared.

In October, Anderson was arrested in Tipton County, Tenn., and was extradited back to South Dakota in January to face charges in Pennington and Meade counties.
Anderson, who was originally charged with five counts of grand theft by deception, pleaded guilty to two counts of grand theft by embezzlement in Pennington County. As part of the plea agreement, the other three grand theft charges were dropped.
According to Pennington County deputy state's attorney Scott Roetzel, Anderson said he preferred the term embezzlement to deception because Anderson had planned to start the baseball team. Anderson said in court Tuesday that he instead misused the money for cocaine and gambling.
Anderson could face 20 years in prison, 10 years for each count of grand theft by embezzlement. Under the terms of the plea agreement, the prosecution has agreed to ask for a five-year prison sentence with 15 years of probation.
Roetzel said all of the victims were consulted in crafting the plea agreement.
Anderson's attorney, Arnold Laubauch, said his client is responsible for more than $22,000 in restitution. If Anderson fails to pay the restitution during his probation period, he could be sent back to prison.
Anderson's sentencing is scheduled for 2 p.m. June 27 in front of Judge Janine M. Kern.
Anderson also allegedly swindled The Batter's Box out of $18,500 after promising to hold a baseball clinic and bring professional baseball players to Rapid City.
Jason Herz, the owner of The Batter's Box, filed a civil suit last summer against Anderson. Anderson never responded, and Herz won by default judgment. Herz said Tuesday that he expects a resolution in the civil case once the criminal case is closed.

$132,000 embezzlement scam alleged in Jefferson Parish school system in Louisiana


Fraud charges were filed against Kimberly M. Williams, 34, of New Orleans, Geselle Savoy, 52, of Alamogordo, N.M., Amanda Jackson, 55, of Harvey and Danay Jackson, 33, of Harvey, the U.S. attorney's office said. Tracy Walker, 42, of Westwego was charged with misprision of a felony, or failing to report a crime.

Prosecutors said all five were school system employees but not certified teachers or qualified to perform tutoring, testing or remediation. But Williams and Savoy, testing technicians in the school system's central office, are accused of submitting fraudulent payroll documents for all five defendants, generating about $132,152 in supplemental pay and stipends. (See PDF of the charges.)
The money came from the school system's general fund and special funds for the Louisiana Education Assessment Program test, Graduate Exit Examination and Education Excellence.
School officials said they were pleased to learn of the charges.
"When we uncovered alleged illegal activity by five of our employees, we immediately reported our findings to the authorities and are fully cooperating with their investigation," school system spokeswoman Beth Branley said. "We will continue monitor programs for any type of illegal activity that adversely impacts funding designated for our children."
Amanda and Danay Jackson are related, but it was not immediately clear how.
All five defendants have been fired from their jobs. None could be reached for comment Tuesday.
The charges were filed not in an indictment by a grand jury but by prosecutors in a bill of information, sometimes an indication that defendants have already reached plea agreements.
The bill says the fraud took place from Feb. 11, 2007, through Sept. 2, 2009, beginning when Williams added unauthorized overtime hours for herself under the school system's interval assessment program. Eventually, prosecutors said, Savoy and the two Jacksons asked to be included.
Amanda Jackson worked as a processing clerk in the accounts receivable office, Danay Jackson as an office clerk at Estelle Elementary School in Marrero.
Walker allegedly became involved in July 2008, when Amanda Jackson told Savoy to provide unauthorized stipends and overtime payments to Walker, using her employee number. Walker was a child nutrition worker at Vic Pitre Elementary in Westwego.
In one instance, Amanda Jackson allegedly instructed Walker to meet her in the parking lot of the Jefferson Financial Credit Union and hand over $5,940 of the $7,920 that Walker had illegally received in summer remediation payments. At a second, similar meeting, Jackson instructed Walker to give her $2,925 of the $3,900 that Walker had illegally received for student testing pay.
But at the second meeting, Walker reportedly told Jackson that she no longer wanted to be part of the scheme.
Williams, Savoy and both Jacksons each face a maximum penalty of five years in prison and a $250,000 fine if convicted, although maximum sentences are rare in federal court. Walker faces a maximum of three years' imprisonment and a $250,000 fine.
The case is being investigated by U.S. Secret Service, the federal Department of Education, the Louisiana Electronic and Financial Crimes Task Force and the Jefferson Parish Sheriffs' Office. The prosecutor is Assistant U. S. Attorney Julia Evans.

Plea possible in church embezzlement case in Battle Creek, Michigan


Embezzlement charges could be dropped against the former financial manager of a Battle Creek church if she repays nearly $50,000.

Kathleen Vanorsdol waived her preliminary examination in Calhoun County District Court Tuesday and may not face any criminal charges if she repays $47,737 to the First United Methodist Church, 111 E. Michigan Ave.
Appearing Tuesday morning with her attorney, Jeff Getting of Kalamazoo, Vanorsdol, 45, of Kalamazoo, agreed to waive the hearing and District Judge John Holmes ordered the case bound over to circuit court for trial.
Vanorsdol is charged with one count of embezzlement with a maximum penalty of 10 years in prison.
However, Assistant Prosecutor Brandon Hultink told Holmes that he and Getting have reached a possible plea agreement.
If Vanorsdol repays the money before she is sentenced in circuit court in the next several weeks, all charges will be dropped.
If she is not able to repay the money by then, she will be placed on probation for 36 months and if she repays the money before the end of that probation period, the felony will be reduced to a misdemeanor.
But if she does not repay the money, then the felony conviction remains.
After the hearing, Getting declined to comment.
The church pastor, the Rev. Billie Dalton, called the agreement an admission of guilt by Vanorsdol. Battle Creek police allege the money was taken between September 2009 and September 2011.
Dalton, pastor of the 178-year-old church since March 1, 2009, called for an audit and said Vanorsdol resigned about a week before discrepancies were found on March 11.
"There is an admission of guilt and she is being held accountable," Dalton said, although Vanorsdol has not yet entered a plea in the case.
"The need for her to be held accountable is quite high," Dalton said. "We want her to be held accountable and return the money to the church."
Several members of the congregation attended the brief hearing with Dalton.
The pastor described their attitude as angry and sad and "wanting someone to pay. All of the emotions of being a victim are present in my congregation."
But he said the church will recover from the loss and said many in the Battle Creek community have been supportive.
Dalton also said the church has instituted new financial safeguards to protect it from future embezzlements.