Friday, May 23, 2008

I have no words

First of, how does a minor hockey team have $18,000 to steal in the first place.

Second, what kind of person steals money from a minor hockey team. Twice.

Allegedly, of course.


New reality said...

The same kind of people that steal $82,000 from a minor soccer team out here...makes me sick.
The only good thing so far, he's been caught by authorities in South Africa, where they are gathering evidence from the "SIX" (yes, that's right) different countries where he has ripped off soccer people.
Me thinks he would have been better off being caught over here, however, there might be some actual justice handed out over there.
And Sager, Duane...keep up the good westerners like it.

Dennis Prouse said...

I have done a lot of work in the volunteer sector, so I know this sad story very well. It is a VERY common one in volunteer based organizations, be they sports based or otherwise.

$18,000, sadly, is not uncommon. There have been scams far larger. It was just a few years ago that when the Treasurer of the ODMHA died, they discovered that a substantial amount of money, i.e. well in excess of $200,000 IIRC, was missing. It was reported in the papers, but the media's overall lack of interest in pursuing the case was perplexing. Eventually, it was settled out of court with the deceased Treasurer's estate -- the ODMHA claims they recovered a "substantial" amount of the money, but as with all of these kinds of settlements both parties very conveniently agree to a gag order.

In that case, the lack of institutional control was appalling. The President used to routinely sign cheques in advance for the Treasurer, because they lived "so far apart". Co-signing in advance is a HUGE no-no, yet the ODMHA President did so for years. Later, when he likely felt like the walls were closing in, the Treasurer claimed that his vehicle was broken into and his briefcase was "stolen". Shockingly, the "stolen" documents were ODMHA financial records. Again, no red light apparently went on for anyone.

It happened again last year in Leitrim Minor Hockey. A person responsible for booking the ice time instead took the cheques and deposited them in her account. I believe the amount in question there was about $20,000, give or take. The same story has been repeated endlessly in all kinds of other sports and not-for-profits. Again, the media never seems to show much interest in doing any follow up on these stories.

The opportunities for this kind of fraud are rife in not-for-profits. There is often an awful lot of money flowing in. In the case of a rep hockey team, every parent is going to be asked for a very large up front cheque. Multiply that by 17 players, toss in some sponsorship money, and you have an awful lot of cash pretty quickly. Still, most organizations are run by a bunch of well meaning, but overworked and sometimes overmatched volunteers. There is a level of trust, so people will buy your story quite easily.

There appear to be two kinds of fraudsters -- those who are gunning for the money right from the get-go, and instantly volunteer to be the Treasurer. The other type of fraud, seemingly more prevalent, is "opportunity" fraud. The Treasurer just happens to be a person who is running into some financial difficulty, and takes some money, convincing himself or herself that it is just temporary, and they will pay it back soon. Of course, their financial hole gets deeper, and they keep dipping into the cookie jar until, inevitably, they get caught.

There are handbooks available for volunteer based organizations on proper governance, giving step by step instructions on how to avoid these kinds of nightmares. (One of them involves rotating the Treasurer position, ensuring no one person stays there for a lengthy period.) People have to be pro-active enough to actually read them, though.

sager said...

Good god, I can remember doing student council in high school and counting up hundreds of dollars in receipts from events ... the temptation was incredible, but I never succumbed.

Dennis Prouse said...

I learned my lesson on this one while coaching Midget football. Our 16-18 year olds were slated to sell programs at the Lions game that night. I had an important family function I couldn't miss, so for the first time in years I missed a team function, with my well meaning, but entirely unthreatening manager in place. Well, wouldn't you know it -- somehow, we didn't manage to make any money for the club selling programs that night. Without the Head Coach hovering around, money was disappearing into kids' pockets. These were "nice" kids, but faced with a) strong temptation and b) a minimal chance of getting busted, they succumbed. I was livid, but quickly realized that this venture was doomed from the outset without strong adult supervision.