1. Protecting Your Organization’s Assets From Theft

2.  Dozens of Non-Profits are victimized by dishonest volunteers every year.  The average fraud/theft scheme goes undetected for 18 months.  93% of all frauds are committed by first time perpetrators.

3.  The loss of funds could be devastating.  Members will feel betrayed and may blame officers for not preventing the theft.  Level of trust declines.  Membership numbers could decline, especially if not properly handled.  Support ($) could dry up as contributors want to believe their money is being used appropriately.

4.  Officer and/or committee member positions go vacant for long periods.  Lines of communication deteriorate. (i.e. newsletter becomes infrequent or non- existent, web-page outdated)  Volunteers “burn-out”. Hard to adequately staff booths, etc.  A normally active officer/volunteer suddenly drops off the face of the earth. (No contact)  Be aware of officers having personal problems. (i.e. divorce, loss of job)

5.  Developed by noted criminologist and professor, Dr. Donald R. Cressy  Suggested that three circumstances must exist for an otherwise trustworthy person to steal. ◦ Motive or Pressure ◦ Opportunity ◦ Rationalization

6.  Motive / Pressure - Even good people sometimes find themselves financially strapped, addicted to drugs or alcohol or just not able to live within their means.  Opportunity – Lack of oversight may lead a volunteer to think they can “get away with it”.  Rationalization – “I deserve it for all my hard work.” or “They’ll never miss it.” or “I’ll pay it back before they notice.”

7.  Remove “Opportunity” from the triangle. ◦ Your organization must have well thought out and effective security measures. ◦ Create a system where all financial transactions are well documented and transparent to members/auditors.

8.  ALWAYS require two signatures on checks.  Never leave volunteers alone with cash.  Before shutting down a booth/show count cash proceeds in presence of two individuals.  Establish a finance committee to review financial reports.  Consider a complete audit, preferably by an independent CPA.

9.  Don’t leave cash in an unsecured container.  Don’t allow volunteers to take cash home.  Count cash proceeds in front of two people and turn cash over to treasurer to be deposited that day.  Keep petty cash to $100.00 or less.

10.  Avoid making any payments from the daily cash receipts.  Consider a debit card as its use generates a record.  Always require receipts, vouchers, etc. before any payments to a vendor or volunteer.  Always create a paper trail.  Use a book keeping software to record transactions. (i.e. Quicken, Quick Books)  Require treasurer’s report to be published in each newsletter.

11.  Even the best controls only limit your risk.  Fidelity Bond – Ensures if your funds are stolen they will be recovered.  Liability Insurance – protects officers, volunteers and third parties.

12.  First and foremost report the theft as soon as it is discovered/verified.  PROSECUTE! You can’t afford to give the impression that your agency will tolerate even the smallest of thefts.  Be honest with members about the incident. Don’t hide any of the ugly facts.  Be sure to let your members know what measures you will take to prevent a re- occurrence.  Incorporate changes into by-laws.

13. Thanks for your attention. Any questions or comments?