“The Institute for the Study of War has learned and confirmed that, contrary to her representations, Ms. Elizabeth O’Bagy does not in fact have a Ph.D. degree from Georgetown University,” the institute said in a statement. “ISW has accordingly terminated Ms. O’Bagy’s employment, effective immediately.” O'Bagy's article was relied upon by Secretary of State Kerry to promote an attack on the Assad regime in Syria for reportedly using chemical weapons.
Read the story here: http://www.politico.com/story/2013/09/wall-street-journal-elizabeth-obagy-fired-96637.html
Developing...
Wednesday, September 11, 2013
Friday, August 9, 2013
Utah Woman Pleads Guilty To Embezzling $145K; Former CFO May Have Stolen As Much As $1 Million
From The Salt Lake Tribune:
Pool Cover Specialists — you can guess what this West Jordan company makes — set a sales record last year. But it did so after climbing out of a hole that someone else dug — one so deep that it could have killed the business.
"We broke a 29-year company record in 2012, even after we caught our CFO (chief financial officer) with her hand in the proverbial cookie jar," said Bruce Grogg, Pool Cover's CEO.
Last week, Penny Thurman pleaded guilty in 3rd District Court to one charge of theft by deception and a second charge of unlawful use of a credit card — both second-degree felonies. She admitted stealing $145,000 over a period of more than two years. Gregg said the amount may be a lot more, as much as $750,000 to $1 million.
"That was all we were able to prove," he said.
The thefts began just four weeks after Thurman was hired in 2009 and continued until March 2012. Grogg said Thurman had complete control over the accounting department. She misused company credit cards, set up double payrolls and paid vendors who didn't exist.
"She had everybody fooled, including our auditors. We trusted her 100 percent," Grogg said.
...
Pool Cover Specialists — you can guess what this West Jordan company makes — set a sales record last year. But it did so after climbing out of a hole that someone else dug — one so deep that it could have killed the business.
"We broke a 29-year company record in 2012, even after we caught our CFO (chief financial officer) with her hand in the proverbial cookie jar," said Bruce Grogg, Pool Cover's CEO.
Last week, Penny Thurman pleaded guilty in 3rd District Court to one charge of theft by deception and a second charge of unlawful use of a credit card — both second-degree felonies. She admitted stealing $145,000 over a period of more than two years. Gregg said the amount may be a lot more, as much as $750,000 to $1 million.
"That was all we were able to prove," he said.
The thefts began just four weeks after Thurman was hired in 2009 and continued until March 2012. Grogg said Thurman had complete control over the accounting department. She misused company credit cards, set up double payrolls and paid vendors who didn't exist.
"She had everybody fooled, including our auditors. We trusted her 100 percent," Grogg said.
...
Thursday, August 8, 2013
Former Illinois Media Exec Pleads Guilty To Embezzling $264K
From the Chicago Tribune on 6/13/13:
A former Tribune Co. executive pleaded guilty Wednesday in federal court to mail fraud, admitting she stole $264,000 in commissions meant for the company.
Stephanie Pater, 39, had drawn the ire of a federal judge early this year when she failed to appear in court after she was charged.
Pater, a former director of real estate for Tribune Co., left the company in 2010 to form her own real estate management business. Tribune Co. hired Pater to oversee its real estate holdings for a monthly fee.
Pater admitted that she stole the $264,000 by creating a fake contract with Tribune Co. that improperly directed commissions from a real estate brokerage business to her company, not Tribune Co. The thefts took place from March to September 2010, prosecutors said.
...
A former Tribune Co. executive pleaded guilty Wednesday in federal court to mail fraud, admitting she stole $264,000 in commissions meant for the company.
Stephanie Pater, 39, had drawn the ire of a federal judge early this year when she failed to appear in court after she was charged.
Pater, a former director of real estate for Tribune Co., left the company in 2010 to form her own real estate management business. Tribune Co. hired Pater to oversee its real estate holdings for a monthly fee.
Pater admitted that she stole the $264,000 by creating a fake contract with Tribune Co. that improperly directed commissions from a real estate brokerage business to her company, not Tribune Co. The thefts took place from March to September 2010, prosecutors said.
...
Former General Manager Of Illinois Company Charged With Embezzling More Than $2 Million
From the Chicago Tribune:
A longtime former general manager of a west suburban chemical company has been charged with embezzling more than $2 million, in part to pay off credit card bills and remodel her kitchen, Cook County prosecutors said Thursday.
Kathleen Barth was fired as general manager at Kraft Chemical Co. after the thefts were discovered a year ago, according to a Circuit Court lawsuit filed by the company to recover the losses.
According to the lawsuit and prosecutors, Barth was paid $65,000 a year but secretly inflated her compensation to as much as $286,000, disguising the additional money as bonuses and commissions.
She also electronically transferred about $990,000 from the company's checking account to pay off her personal credit cards, prosecutors alleged. According to the lawsuit, those payments to her American Express card totaled as much as $40,000 in a single month.
Prosecutors charged that Barth also stole from Kraft by issuing unauthorized company checks directly to herself and having the company issue checks to contractors to pay for work at her Chicago home. She spent as much as $91,000 in company funds to remodel the kitchen, according to the lawsuit.
Barth, 56, was arrested Wednesday night on a warrant that set her bail at $200,000. She is being held in Cook County Jail until a hearing Friday at which prosecutors intend to seek an increase in the bail amount.
...
Barth, who joined the company in April 2005, grew bolder with each year she got away with the thefts, according to the lawsuit. She allegedly inflated her salary to $101,500 in 2006 with the phony bonuses and commissions. By 2011, her salary had soared to $286,000 as part of the scheme, the lawsuit alleged. In that way, Barth stole more than $840,000, prosecutors charged.
She also used company money to pay her personal Citi Card and American Express credit cards, sometimes tens of thousands of dollars at a time. The lawsuit alleged that Barth disguised electronic transfers on company paperwork by referring to them as "profit sharing" and "miscellaneous" expenses.
...
A longtime former general manager of a west suburban chemical company has been charged with embezzling more than $2 million, in part to pay off credit card bills and remodel her kitchen, Cook County prosecutors said Thursday.
Kathleen Barth was fired as general manager at Kraft Chemical Co. after the thefts were discovered a year ago, according to a Circuit Court lawsuit filed by the company to recover the losses.
According to the lawsuit and prosecutors, Barth was paid $65,000 a year but secretly inflated her compensation to as much as $286,000, disguising the additional money as bonuses and commissions.
She also electronically transferred about $990,000 from the company's checking account to pay off her personal credit cards, prosecutors alleged. According to the lawsuit, those payments to her American Express card totaled as much as $40,000 in a single month.
Prosecutors charged that Barth also stole from Kraft by issuing unauthorized company checks directly to herself and having the company issue checks to contractors to pay for work at her Chicago home. She spent as much as $91,000 in company funds to remodel the kitchen, according to the lawsuit.
Barth, 56, was arrested Wednesday night on a warrant that set her bail at $200,000. She is being held in Cook County Jail until a hearing Friday at which prosecutors intend to seek an increase in the bail amount.
...
Barth, who joined the company in April 2005, grew bolder with each year she got away with the thefts, according to the lawsuit. She allegedly inflated her salary to $101,500 in 2006 with the phony bonuses and commissions. By 2011, her salary had soared to $286,000 as part of the scheme, the lawsuit alleged. In that way, Barth stole more than $840,000, prosecutors charged.
She also used company money to pay her personal Citi Card and American Express credit cards, sometimes tens of thousands of dollars at a time. The lawsuit alleged that Barth disguised electronic transfers on company paperwork by referring to them as "profit sharing" and "miscellaneous" expenses.
...
Florida Woman Sentenced For Embezzling Nearly $7 Million From Health Concern
From the Miami Herald on 6.12.13:
The community knew Kathryn Abbate as the leader of a Miami Beach-based clinic that provides vital healthcare to the poor and uninsured.
Secretly, her attorney and prosecutors say she was a gambler, drug addict and thief, raiding almost $7 million from the Miami Beach Community Health Center to support her habits.
For that, a federal judge on Wednesday sentenced Abbate to 42 months in prison -- but not before her attorney Bruce Lyons spun a tale of a deeply troubled woman.
He called it a “tale of two Kathryns.”
According to Lyons: There were long nights playing slots at the Seminole Hard Rock Hotel and Casino. Bundles of cash for unnamed politicians -- some of it surreptitiously left under a raincoat. Secret payments to settle sexual harassment allegations against a clinic employee. Another $50,000 went to someone’s wedding.
“I accept the responsibility for my conduct,” Abbate told Judge Marcia Cooke, “because I am responsible.”
She added: “I am 64-years-old. Not in the greatest of health. And I am petrified...I’m just praying that you’ll consider my lifetime of service.”
Lyons said his client didn’t live a lavish lifestyle, but she stole to secretly feed her addictions. ... The ill-gotten money flowed from unearned leave time paid out to Abbate, as well as 800 checks she paid to herself from 2008 until she was caught in 2012, according to prosecutors. She claimed the money was for “community development,” and despite offering no back up documentation, the expenses passed the examination of auditors year after year.
The health center has sued the companies responsible for looking over the center’s books, and three people quit or were fired after news broke of Abbate’s embezzlement -- which the center made public by contacting The Miami Herald. ... Abbate pled guilty in March and faced up to 10 years in prison. She received a lighter sentence in exchange for cooperating with authorities. ...
The community knew Kathryn Abbate as the leader of a Miami Beach-based clinic that provides vital healthcare to the poor and uninsured.
Secretly, her attorney and prosecutors say she was a gambler, drug addict and thief, raiding almost $7 million from the Miami Beach Community Health Center to support her habits.
For that, a federal judge on Wednesday sentenced Abbate to 42 months in prison -- but not before her attorney Bruce Lyons spun a tale of a deeply troubled woman.
He called it a “tale of two Kathryns.”
According to Lyons: There were long nights playing slots at the Seminole Hard Rock Hotel and Casino. Bundles of cash for unnamed politicians -- some of it surreptitiously left under a raincoat. Secret payments to settle sexual harassment allegations against a clinic employee. Another $50,000 went to someone’s wedding.
“I accept the responsibility for my conduct,” Abbate told Judge Marcia Cooke, “because I am responsible.”
She added: “I am 64-years-old. Not in the greatest of health. And I am petrified...I’m just praying that you’ll consider my lifetime of service.”
Lyons said his client didn’t live a lavish lifestyle, but she stole to secretly feed her addictions. ... The ill-gotten money flowed from unearned leave time paid out to Abbate, as well as 800 checks she paid to herself from 2008 until she was caught in 2012, according to prosecutors. She claimed the money was for “community development,” and despite offering no back up documentation, the expenses passed the examination of auditors year after year.
The health center has sued the companies responsible for looking over the center’s books, and three people quit or were fired after news broke of Abbate’s embezzlement -- which the center made public by contacting The Miami Herald. ... Abbate pled guilty in March and faced up to 10 years in prison. She received a lighter sentence in exchange for cooperating with authorities. ...
California Woman Sentenced For Embezzling Some $1.2 Million From Farming Concern
From the Fresno Bee on 6/12/13:
A 53-year-old Corcoran woman was sentenced to 6 years and 8 months in state prison Tuesday after she was convicted of embezzling $1.2 million from a farm company, the Tulare County District Attorney's Office said.
Lisa Chambers Trujillo, who was a secretary for a farming company from 2007 to 2012, wrote checks to herself from the business' bank account and the owner's personal account. Trujillo pleaded guilty on May 8 to felony grand theft and felony elder abuse.
A 53-year-old Corcoran woman was sentenced to 6 years and 8 months in state prison Tuesday after she was convicted of embezzling $1.2 million from a farm company, the Tulare County District Attorney's Office said.
Lisa Chambers Trujillo, who was a secretary for a farming company from 2007 to 2012, wrote checks to herself from the business' bank account and the owner's personal account. Trujillo pleaded guilty on May 8 to felony grand theft and felony elder abuse.
Former Virginia Restauranteur Pleads Guilty To Embezzling Some $200K From 2 Bookkeeping Clients
From the Daily Progress on 6.11.13:
About three years after abruptly closing his Belmont eatery and fleeing the Charlottesville area, former restaurateur James Baldi has pleaded guilty to embezzling about $200,000 from two Albemarle County bookkeeping clients.
Baldi, 49, entered into an agreement Tuesday with county prosecutors that calls for him to plead guilty to five felony embezzlement charges: four in Albemarle and one in Charlottesville, which he is scheduled to appear in court for next month.
...
"[Baldi] is very anxious to make restitution and set things right," Goodman said.
Baldi still owes about $155,000 to Wood Grill Buffet's parent company and $23,700 to Duraclean, according to court records.
Baldi's alleged crimes stretch back to 2008, nearly a year and a half before a "closed for vacation" sign went up on the former Bel Rio restaurant and he disappeared. He was not indicted on the first of those charges until about 5 months after he left the area, according to court records.
His company, Bel Rio LLC, was dissolved in December 2010 on the same day a Charlottesville circuit judge awarded his former restaurant partner, Gareth Weldon, $45,900 in damages and court costs.
Weldon sued Baldi for breaching his fiduciary duty and conversion, or, making unilateral decisions in a way that deprived Weldon of his stake in their shared property, according to court records.
...
Kansas Woman Sentenced For Not Paying Taxes On Nearly $2 Million In Funds She Embezzled
From the US DOJ:
...
Teresa Joyce Moore, 65, Kansas City, Mo., was sentenced to 33 months in federal prison. She pleaded guilty to one count of filing false income tax returns. In her plea, she admitted the crime occurred while she was working for Big W of Kansas City, Kan., a family run business specializing in manufacturing expandable polystyrene molding, processing and cutting equipment. She was a bookkeeper and officer manager with duties that included invoicing, tracking payroll and general bookkeeping.
In late 2007, the owners of Big W realized that Moore had defrauded the company. She created false invoices from legitimate vendors and prepared checks payable to the vendors. Then she created checks for the same amount payable to herself or her credit card company. When the checks with the forged signature cleared the bank and was returned to Big W., Moore hid them and put the checks payable to the legitimate vendor in Big W’s records.
Moore used embezzled funds to purchase homes, furniture, appliances and other items. On her 2006 federal tax return she reported income of $31,990. In fact, she had received income of more than $451,000 through her embezzlement scheme. On her 2007 federal tax return, she reported an income of $30,881. She did not report more than $507,000 she received from her embezzlement in 2007. Moore embezzled a total of nearly $2 million while working for Big W.
...
...
Teresa Joyce Moore, 65, Kansas City, Mo., was sentenced to 33 months in federal prison. She pleaded guilty to one count of filing false income tax returns. In her plea, she admitted the crime occurred while she was working for Big W of Kansas City, Kan., a family run business specializing in manufacturing expandable polystyrene molding, processing and cutting equipment. She was a bookkeeper and officer manager with duties that included invoicing, tracking payroll and general bookkeeping.
In late 2007, the owners of Big W realized that Moore had defrauded the company. She created false invoices from legitimate vendors and prepared checks payable to the vendors. Then she created checks for the same amount payable to herself or her credit card company. When the checks with the forged signature cleared the bank and was returned to Big W., Moore hid them and put the checks payable to the legitimate vendor in Big W’s records.
Moore used embezzled funds to purchase homes, furniture, appliances and other items. On her 2006 federal tax return she reported income of $31,990. In fact, she had received income of more than $451,000 through her embezzlement scheme. On her 2007 federal tax return, she reported an income of $30,881. She did not report more than $507,000 she received from her embezzlement in 2007. Moore embezzled a total of nearly $2 million while working for Big W.
...
Tennessee Man Charged With Embezzling Nearly $100K From Equipment Company
From the Kingsport Times-News on 6/10/13:
Kingsport man contracted to sell Snap-On equipment has been arrested after allegedly failing to compensate the company for nearly $100,000 in merchandise.
Kevin Scott Hamilton, 41, of 5110 Springview St., was charged Wednesday with felony embezzlement and theft over $60,000. According to police and court records Hamilton is the owner of Hamilton Equipment Solutions, LLC, located at 116 Regional Park Drive.
...
The Snap-On representative claimed Hamilton sold the items to multiple third parties, but failed to compensate Snap-On for the merchandise. Kingsport Police Det. Monica Swayze says the company has had multiple correspondences with Hamilton regarding the outstanding balance — tallied at $93,199.81 — but had been unable to collect the money.
...
Kingsport man contracted to sell Snap-On equipment has been arrested after allegedly failing to compensate the company for nearly $100,000 in merchandise.
Kevin Scott Hamilton, 41, of 5110 Springview St., was charged Wednesday with felony embezzlement and theft over $60,000. According to police and court records Hamilton is the owner of Hamilton Equipment Solutions, LLC, located at 116 Regional Park Drive.
...
The Snap-On representative claimed Hamilton sold the items to multiple third parties, but failed to compensate Snap-On for the merchandise. Kingsport Police Det. Monica Swayze says the company has had multiple correspondences with Hamilton regarding the outstanding balance — tallied at $93,199.81 — but had been unable to collect the money.
...
Former Travel Agency Owner In Wisconsin Sentenced For Embezzling $270K In Customer Funds
From the Fond du Lac Reporter on 7/29/13:
Victims that had their dream vacations wrested away from them by the former owner of Carol’s Tours packed the courtroom Monday morning, eager for their long awaited day in court.
Deborah Paul, 58, was found guilty of felony theft in October 2012. However, several delays due to Paul’s “health problems” forced several postponements over the past nine months, taxing the patience of victims.
...
Paul, the owner of a defunct Beaver Dam travel agency was found guilty of bilking 243 travelers out of money paid for their dream vacations and travel insurance premiums. Judge Andrew Bissonnette sentenced Paul to 27 months in prison followed by three years of extended supervision upon her release. He also ordered seven years of probation and that Paul pay her victims more than $191,000 in restitution. Bissonnette granted Paul 138 days of pre-sentence jail credit.
State Department of Justice Prosecutor Richard Dufour said Paul, who closed Carol's Tours in 2007, took in more than $270,000 in trip payments and $15,000 in useless travel insurance premiums. State investigators found she paid numerous personal and family bills, including mortgage and utility payments, with the money, according to the court complaint.
Paul's former officer manager, Lisa Hopper, was sentenced to 18 months in prison after she was found guilty of stealing more than $97,000 from the business.
...
Victims that had their dream vacations wrested away from them by the former owner of Carol’s Tours packed the courtroom Monday morning, eager for their long awaited day in court.
Deborah Paul, 58, was found guilty of felony theft in October 2012. However, several delays due to Paul’s “health problems” forced several postponements over the past nine months, taxing the patience of victims.
...
Paul, the owner of a defunct Beaver Dam travel agency was found guilty of bilking 243 travelers out of money paid for their dream vacations and travel insurance premiums. Judge Andrew Bissonnette sentenced Paul to 27 months in prison followed by three years of extended supervision upon her release. He also ordered seven years of probation and that Paul pay her victims more than $191,000 in restitution. Bissonnette granted Paul 138 days of pre-sentence jail credit.
State Department of Justice Prosecutor Richard Dufour said Paul, who closed Carol's Tours in 2007, took in more than $270,000 in trip payments and $15,000 in useless travel insurance premiums. State investigators found she paid numerous personal and family bills, including mortgage and utility payments, with the money, according to the court complaint.
Paul's former officer manager, Lisa Hopper, was sentenced to 18 months in prison after she was found guilty of stealing more than $97,000 from the business.
...
Former University Employee Charged With Embezzling $367,901 Over 6 Year Period
From the Wall Street Journal on 6/8/13:
A grand jury has indicted a former Rensselaer Polytechnic Institute employee on charges she stole more than $350,000 from the university.
Rensselaer County District Attorney Richard McNally says Christine Dickson faces a felony count of second-degree grand larceny. Authorities say she used an RPI-issued credit card to steal $367,901 between 2003 and 2009.
The 55-year-old Dickson was arrested three years ago but had been in plea negotiations since. The grand jury indicted her Friday.
...
Dickson is accused of using the card to get $82,000 in cash advances, $15,000 in car rentals, $4,900 for cruise and airline travel and $1,500 in charges to Amazon.com. She also funded some trips to casinos.
A grand jury has indicted a former Rensselaer Polytechnic Institute employee on charges she stole more than $350,000 from the university.
Rensselaer County District Attorney Richard McNally says Christine Dickson faces a felony count of second-degree grand larceny. Authorities say she used an RPI-issued credit card to steal $367,901 between 2003 and 2009.
The 55-year-old Dickson was arrested three years ago but had been in plea negotiations since. The grand jury indicted her Friday.
...
Dickson is accused of using the card to get $82,000 in cash advances, $15,000 in car rentals, $4,900 for cruise and airline travel and $1,500 in charges to Amazon.com. She also funded some trips to casinos.
Texas Woman Pleads Guilty To Embezzling $772K
From the Terrell Tribune on 6/9/13:
A Kaufman woman is facing prison time after pleading guilty on Wednesday in connection with embezzling more than $750,000 from her employer.
Marci Johnson, 46, appeared in federal court and pleaded guilty before U.S. District Judge Jorge A. Solis to one count of mail fraud, stemming from her embezzlement of more than $772,000.
A Kaufman woman is facing prison time after pleading guilty on Wednesday in connection with embezzling more than $750,000 from her employer.
Marci Johnson, 46, appeared in federal court and pleaded guilty before U.S. District Judge Jorge A. Solis to one count of mail fraud, stemming from her embezzlement of more than $772,000.
Wisconsin Woman Accused Of Embezzling $500K
From WSAW:
An Athens woman is suspected of stealing more than $500,000 from a Wausau business where she worked for nearly 20 years.
Police say Michelle Walters, 39, embezzled the money from Northwestern Wisconsin Associates, Inc., a retirement plan company.
Walters has not yet been charged, but could face felony theft charges.
According to police reports, Walters confessed to stealing the money from NWA over the last six years to both her employer and police.
NWA president and owner, Matthew Stifler, found out about the scheme when the company's accountant noticed in the company ledger there had been a donation made to Arts Bash.
The accountant thanked Stifler for making the donation, since he had been involved in Arts Bash, but Stifler said he hadn't made a donation in years.
They got the original check from the company's bank, and found it was written to Michelle Walters, signed by Michelle Walters and endorsed by Michelle Walters.
That led Stifler to go through records to find dozens of unauthorized checks written by the suspect. For each unauthorized check Walters would list a different name as payee in the ledger, which was later entered into a computer.
Many checks were actually written to credit card companies, utilities, travel agents, and other businesses for Walters' personal gain.
Wausau Police Detective Jeff Strobach says Walters, who made $88,000 in 2011, admitted to the crime.
...
She also confessed to stealing the money and said she has a huge credit card problem. When asked what kinds of things she spent the money on, Walters said lots of little things like clothes, things for her kids and her husband.
Walters also said she'd put her home up for sale to pay back the company.
...
An Athens woman is suspected of stealing more than $500,000 from a Wausau business where she worked for nearly 20 years.
Police say Michelle Walters, 39, embezzled the money from Northwestern Wisconsin Associates, Inc., a retirement plan company.
Walters has not yet been charged, but could face felony theft charges.
According to police reports, Walters confessed to stealing the money from NWA over the last six years to both her employer and police.
NWA president and owner, Matthew Stifler, found out about the scheme when the company's accountant noticed in the company ledger there had been a donation made to Arts Bash.
The accountant thanked Stifler for making the donation, since he had been involved in Arts Bash, but Stifler said he hadn't made a donation in years.
They got the original check from the company's bank, and found it was written to Michelle Walters, signed by Michelle Walters and endorsed by Michelle Walters.
That led Stifler to go through records to find dozens of unauthorized checks written by the suspect. For each unauthorized check Walters would list a different name as payee in the ledger, which was later entered into a computer.
Many checks were actually written to credit card companies, utilities, travel agents, and other businesses for Walters' personal gain.
Wausau Police Detective Jeff Strobach says Walters, who made $88,000 in 2011, admitted to the crime.
...
She also confessed to stealing the money and said she has a huge credit card problem. When asked what kinds of things she spent the money on, Walters said lots of little things like clothes, things for her kids and her husband.
Walters also said she'd put her home up for sale to pay back the company.
...
Alaska Man Sentenced For Role In $500K Embezzlement Scheme From Seafood Company
From the Seattle Times on 6/7/13:
A Kodiak man will serve 28 months in a federal prison for taking part in a scheme to embezzle nearly $500,000 from the Trident Seafoods plant in Kodiak.
The Kodiak Daily Mirror reports (http://is.gd/AMhPD7) 31-year-old Jeremy Smith was sentenced in U.S. District Court this week for two counts of wire fraud.
The missing funds were discovered shortly after 32-year-old Isairis Wolfe was fired as the plant's bookkeeper in 2010.
Federal authorities allege she wrote 52 checks over a 2 1/2 year period to four people and one of their underage sons.
Also indicted were Anne Wilson, who is also known as Anne Sorio, of Kent, Wash.; Valerie Olivares, of Corpus Christi, Texas, and Jamie Fathke of Kodiak.
All have been given prison terms except Wolfe, who will be sentenced Tuesday.
A Kodiak man will serve 28 months in a federal prison for taking part in a scheme to embezzle nearly $500,000 from the Trident Seafoods plant in Kodiak.
The Kodiak Daily Mirror reports (http://is.gd/AMhPD7) 31-year-old Jeremy Smith was sentenced in U.S. District Court this week for two counts of wire fraud.
The missing funds were discovered shortly after 32-year-old Isairis Wolfe was fired as the plant's bookkeeper in 2010.
Federal authorities allege she wrote 52 checks over a 2 1/2 year period to four people and one of their underage sons.
Also indicted were Anne Wilson, who is also known as Anne Sorio, of Kent, Wash.; Valerie Olivares, of Corpus Christi, Texas, and Jamie Fathke of Kodiak.
All have been given prison terms except Wolfe, who will be sentenced Tuesday.
Thursday, July 25, 2013
Recent Trends In Employee Theft
The following article I wrote was published in KYC360 - The Online AML Community:
As the economy continues to bump along five years after the 2008 economic crash in the U.S., major embezzlement cases have never been more prevalent. Our statistics, based upon Marquet International data compiled over the past five years of U.S. embezzlement cases of more than $100,000, reveal that 2012 was a banner year for employee theft with 2013 running apace of last year. Since our data also shows that the average case spans nearly five years, we believe that the current pace of major embezzlements will not decline any time soon. The frauds that began for economic purposes immediately after the downturn are now just surfacing.
As the economy continues to bump along five years after the 2008 economic crash in the U.S., major embezzlement cases have never been more prevalent. Our statistics, based upon Marquet International data compiled over the past five years of U.S. embezzlement cases of more than $100,000, reveal that 2012 was a banner year for employee theft with 2013 running apace of last year. Since our data also shows that the average case spans nearly five years, we believe that the current pace of major embezzlements will not decline any time soon. The frauds that began for economic purposes immediately after the downturn are now just surfacing.
Anecdotal evidence suggests that many embezzlers steal from their employer with the initial view of their action as "just a loan" and that they "intend to pay it back". However, we have learned that most employee thefts typically start out small and grow in magnitude over time as the fraudster becomes emboldened for having not been caught, and realizing the ease with which the scheme(s) worked. What started out as a "one time" $5,000 payroll fraud scheme ends up being half a million dollar fraud six years later. Likewise what began as a $1,500 credit card abuse becomes a $150,000 embezzlement several years down the road.
Another noteworthy finding from the data is that the apparent motivation for many embezzlers who steal significant amounts from their employer is not to alleviate personal economic problems, but rather to maintain a lifestyle far beyond what they would otherwise enjoy. Many of the schemes may have begun for economic purposes, but the motivation factor quickly morphs into greed or entitlement and somehow the perpetrators are able to justify their actions.
Major embezzlement schemes are not complex, as 2012 Marquet Report on Embezzlement demonstrates. Indeed, our five year analysis showed that the most common scheme employed was the forgery or issuance of fraudulent checks (35.5%), followed by theft of conversion of cash receipts (21.2%) and then unauthorized electronic transfers (12.2%). Not surprisingly, at the height of their misappropriations (usually at the time they are discovered), major embezzlers typically employ more than one scheme in order to fleece their employer.
Contrary to conventional wisdom, our data consistently shows that most perpetrators in large-scale employee theft cases are women. This could be explained by the predominance of females working within finance departments, which is where most of these cases occur. Our five year data, which includes more than 2,000 major embezzlement cases in the US, reveals that over 62% of the perpetrators were women however, interestingly, the men in the data stole at more than double the rate of women.
One surprising result of our analysis is the fact that less than 5% of the perpetrators of these major frauds had prior criminal fraud backgrounds. Therefore background screening, while helpful for many reasons, will only weed out a small segment of potential embezzlers.
Another motivating factor for perpetrators is the clear link we have found between employee theft and gambling. In the cases where an embezzler's motivating factor was known, nearly one third of the cases involved a gambling issue. Not surprisingly, the vast majority of the cases occurred in states where gambling is broadly legalized and casinos are prevalent.
Finally, we have consistently found that the victim organizations are most commonly financial services entities, followed by government entities and then non-profits or religious organizations. We can understand why most major embezzlement cases involve financial firms since, “that is where the money is,” as Willy Sutton, the career bank robber from the 1930's supposedly told a reporter in response to being asked why he robbed banks. Non-profits and religious organizations are also understandable due to their typical weak financial controls and lack of financial oversight. Perhaps governmental bodies simply breed waste, fraud and abuse, accounting for why these are such common victims of employee theft.
We know that there will always be fraud and theft in organizations large and small. However, with proper controls and oversight, these cases can be minimized or stopped short or otherwise mitigated.
Thursday, July 18, 2013
Center for Strategic Business Integrity Formed
For
Immediate Release
(301) 865-1197 or (Info@CenterSBI.com)
The Center for
Strategic Business Integrity Announces Formation
Ijamsville,
MD – July 15, 2013
– The Center for Strategic Business Integrity (“CSBI”) announces its formation
today in response to numerous corporate oversight & compliance failures in
recent years. The CSBI’s mission is to
equip current & prospective board members and their key advisors with
principles & skills to drive robust oversight of any corporate enterprise
by deterring, detecting, responding and resolving material corporate negligence
in strategic decision making as well as business irregularities &
corruption before the damage is done.
Specifically the CSBI is:
The CSBI has
created the professional designation, “Certified
Board Advisor” or CBA, for appropriately qualified members. CBAs are current or potential board leaders
as well as key board advisors who have demonstrated by education, experience
and proven accomplishments that they are equipped with the skills and ethics necessary
to direct a modern corporate enterprise.
Verna added,
“The potential effects of non-routine, high impact business irregularities,
abuse of executive power and poor, sometimes negligent strategic decision
making are potentially catastrophic. As
a Nation, we can no longer tolerate or afford weak boardroom leadership. The Center’s mission is to begin the long but
important process of strengthening our next generation of corporate board
leaders.”
Contact:
Kelly Mackenzie, Director of Communications(301) 865-1197 or (Info@CenterSBI.com)
·
A center for preparing &
certifying board members & key advisors for their critical role;
·
A center for training and education;
·
A center for advocacy – promoting
effective corporate oversight;
·
A center for research – developing insight
into the successes & failures of corporate oversight; and,
·
A center for strategy development –
formulating principles & supporting tools for more effective corporate
oversight.
The CSBI’s
leadership consists of John L. Verna, CEO & Executive Managing Director;
Walter J. Sarkees, Managing Director & Chairman of the Board of Advisors;
and Christopher T. Marquet, Managing Director & Director of Research. In announcing the formation of the CSBI,
Verna said, “We are extremely excited about the creation of the Center for Strategic
Business Integrity. The need for more
professionalized, better skilled corporate directors and related trusted advisors
is long past overdue. The stakes of the
global economic game are simply too high and we must have the best leadership
in the corporate boardroom.”
About the Center for Strategic Business
Integrity
Center for StrategicBusiness Integrity (CSBI) is a research, education,
advocacy and certification (the Certified Board Advisor) organization dedicated
to developing effective corporate oversight strategies and skills for current
and future corporate board directors as well as their key advisors.
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