Without Checking References, Nonprofit Fraud Results, again

by Gary Snyder

When Anita Collins applied to work at the Roman Catholic Archdiocese of New York, in June 2003, the Archdiocese did not perform criminal background checks on prospective employees. So church officials were unaware until recently that she had been convicted of grand larceny in one case and had pleaded guilty to a misdemeanor in another. According to court records, Ms. Collins was arrested in June 1999, and charged with stealing at least $46,000 over 16 months from a Manhattan temporary employment agency where she worked as a payroll manager. In January 1986, she was arrested in the Bronx on multiple counts of criminal forgery and grand larceny. In that case, she pleaded guilty to a Class A misdemeanor and received three years’ probation. She was on probation when she statred working at the diocese

Although she did not live lavishly, she indulge herself in one thing: expensive dolls. When detectives emerged from her three-bedroom apartment on carrying boxes filled with personal effects: 17 or 18 were labeled dolls.

No one questioned the over 450  checks she wrote at the archdiocese to cover small expenses, like office supplies and utility bills. Anita Collins, 67, was charged with embezzling more than $1 million over seven years from the archdiocese. Ms. Collins had issued the checks from the archdiocese to “KB Collins,” the initials of one of her sons. After each check was printed, she would change internal records to show that the check had been issued to a legitimate vendor, prosecutors said. She kept the amounts to less than $2,500 each to avoid the approval of a supervisor required for larger checks. (link)

How many times does this have to happen to get charities attention?

Nonprofit Imperative gathers its information principally from public documents...some of which are directly quoted. Virtually all cited are in some phase of criminal proceedings; some have not been charged, however. Cites in various media: Featured in print, broadcast, and online media outlets, including: Vermont Public Radio, Miami Herald, National Public Radio, Huffington Post, The Sun News, Atlanta Journal Constitution, Wall Street Journal (Profile, News and Photos), FOX2, ABC Spotlight on the News, WWJ Radio, Ethics World, Aspen Philanthropy Newsletter, Harvard Business Review, Current Affairs, The Chronicle of Philanthropy, St. Petersburg Times, B, USA Today Topics, , Newsweek.com, Responsive Philanthropy Magazine, New York Times...and many more • Nonprofits: On the Brink (iUniverse, 2006)

Poor Governance at its Best

by Gary Snyder

This agency distributed checks that weren’t legitimate. Work was not performed. The phone numbers were fictitious, disconnected or belonged to someone else. The Seattle Aging and Disability Services kept doling out over $91,000 for those that were to receive services from the Kinship Care program for Senior Services.

It took an anonymous tip to the city Human Services Department that got an investigation rolling. No city employees were implicated in the alleged theft, but four were disciplined for not adequately investigating complaints of fraud in the city-funded program with at least two leaving. One city employee even gave the perpetrators advance notice that there had been a fraud allegation and that she would be examining invoices and spending. She was terminated.

The Kinship Caregiver program, which provided support to seniors who had sudden responsibility for their grandchildren, is now being managed by Catholic Community Services. (link)

Nonprofit Imperative gathers its information principally from public documents...some of which are directly quoted. Virtually all cited are in some phase of criminal proceedings; some have not been charged, however. Cites in various media: Featured in print, broadcast, and online media outlets, including: Vermont Public Radio, Miami Herald, National Public Radio, Huffington Post, The Sun News, Atlanta Journal Constitution, Wall Street Journal (Profile, News and Photos), FOX2, ABC Spotlight on the News, WWJ Radio, Ethics World, Aspen Philanthropy Newsletter, Harvard Business Review, Current Affairs, The Chronicle of Philanthropy, St. Petersburg Times, B, USA Today Topics, , Newsweek.com, Responsive Philanthropy Magazine, New York Times...and many more • Nonprofits: On the Brink (iUniverse, 2006)

Unwinding of an Unusual Nonprofit Fraud

by Gary Snyder

Virginia Attorney General Ken Cuccinelli said that the state has reached a settlement with a telemarketing company that solicited funds from Virginia residents for a fraudulent veterans charity that is under investigation in multiple states. The settlement requires Michigan-based Associated Community Services Inc. to pay more than $65,000 in refunded contributions, civil penalties and other costs for alleged violations of Virginia law. 


The company was soliciting funds for the now defunct U.S. Navy Veterans Association, a fraudulent organization that purported to raise money to aid disabled veterans and send care packages to troops serving overseas. A state investigation last year concluded that the association collected at least $2 million from Virginia residents over a five-year period that ended in 2010. (sounds like a good deal: stole $2 million and pay only $65,000). 


The settlement requires the telemarketing firm to pay a total of $16,780 among 812 Virginians who contributed to the charity. Associated Community Services already has returned uncashed checks and cash contributions totaling more than $32,500 to an estimated 1,500 Virginians who donated to the group. The settlement also requires the telemarketing firm to pay $9,052.50 to 485 Virginians for contributions made to a separate organization called American Homeless Veterans because the firm had not filed a solicitation notice with the state. Associated Community Services also must pay $25,000 in civil penalties for the alleged violations of the state's charitable solicitation law and $15,000 for reimbursement of the state's expenses and attorney's fees. (link)








Nonprofit Imperative gathers its information principally from public documents...some of which are directly quoted. Virtually all cited are in some phase of criminal proceedings; some have not been charged, however. Cites in various media: Featured in print, broadcast, and online media outlets, including: Vermont Public Radio, Miami Herald, National Public Radio, Huffington Post, The Sun News, Atlanta Journal Constitution, Wall Street Journal (Profile, News and Photos), FOX2, ABC Spotlight on the News, WWJ Radio, Ethics World, Aspen Philanthropy Newsletter, Harvard Business Review, Current Affairs, The Chronicle of Philanthropy, St. Petersburg Times, B, USA Today Topics, , Newsweek.com, Responsive Philanthropy Magazine, New York Times...and many more • Nonprofits: On the Brink (iUniverse, 2006)

Greg Mortenson: A Redux

by Gary Snyder


In an attempt to clear his name, Greg Mortenson co-founder of the  Mont.-based Central Asia Institute,  and of "Three Cups of Tea" fame is removing himself from day-to-day management of CAI. CAI has taken on an acting executive director and a communications director.  She is Karin Ronnow, a former Bozeman Chronicle reporter who wrote adoring stories on Mortenson's work in Afghanistan and northern Pakistan. 


The CAI board of directors will expand …from three members, Mortenson and two other persons. Mortenson crashed from being a celebrity to at the least an embarrassed author and charity executive. Both roles seemed to unwind when the CAI's treasurer and board chairman -- famed physician-climber ("Everest: The West Ridge") Tom Hornbein -- quit in frustration at Mortenson's lack of ability to manage and when the former K2 climber was charged by a "60 Minutes" expose with empty schools and questionable authenticity of his books. 

Nonprofit Imperative gathers its information principally from public documents...some of which are directly quoted. Virtually all cited are in some phase of criminal proceedings; some have not been charged, however. Cites in various media: Featured in print, broadcast, and online media outlets, including: Vermont Public Radio, Miami Herald, National Public Radio, Huffington Post, The Sun News, Atlanta Journal Constitution, Wall Street Journal (Profile, News and Photos), FOX2, ABC Spotlight on the News, WWJ Radio, Ethics World, Aspen Philanthropy Newsletter, Harvard Business Review, Current Affairs, The Chronicle of Philanthropy, St. Petersburg Times, B, USA Today Topics, , Newsweek.com, Responsive Philanthropy Magazine, New York Times...and many more • Nonprofits: On the Brink (iUniverse, 2006)

Unwarranted Trust Results in Two Scandals

bt Gary Snyder

He was “trusted like a member of the Bas Bleu Theater Co." Tom Campbell, board president, said. But now Matthew Shane Strauch has been charged with two counts of theft and three counts of identity theft stemming from two separate investigations.

The former general manager of Bas Bleu and a long time employee, Strauch took the personal information of someone associated with the theater company, opened two credit card accounts and accumulated substantial debt. Strauch also created a bank account at First Bank in the name of Bas Bleu Theatre Co., without the knowledge of company officials, where he is accused of depositing various checks stolen from the business. At least 30 checks were written from the account; five to “cash;” 17 to “Matt Strauch;” five to “Chase;” two to “U.S. Bank;” as well as multiple debit and credit card transactions to local stores, restaurants, online bills and other locations.

As if that was not enough, police said Strauch made five unauthorized counter withdrawals from bank accounts owned by a charter school where he was board treasurer of T.R. Paul Academy of Arts and Knowledge.

Bas Bleu founder and artistic director Wendy Ishii said, "While the financial toll is significant, the emotional toll is even more so."

Nonprofit Imperative gathers its information principally from public documents...some of which are directly quoted. Virtually all cited are in some phase of criminal proceedings; some have not been charged, however. Cites in various media: Featured in print, broadcast, and online media outlets, including: Vermont Public Radio, Miami Herald, National Public Radio, Huffington Post, The Sun News, Atlanta Journal Constitution, Wall Street Journal (Profile, News and Photos), FOX2, ABC Spotlight on the News, WWJ Radio, Ethics World, Aspen Philanthropy Newsletter, Harvard Business Review, Current Affairs, The Chronicle of Philanthropy, St. Petersburg Times, B, USA Today Topics, , Newsweek.com, Responsive Philanthropy Magazine, New York Times...and many more • Nonprofits: On the Brink (iUniverse, 2006)

Without Checking References, Nonprofit Fraud Results

by Gary Snyder

The former director of Portland's federal halfway house pleaded guilty to embezzling about $213,787 from a government-funded nonprofit. Laura Marie Edwards served as executive director of the Oregon Halfway House from 2007 until 2010, when she was suspected of stealing from the nonprofit now known as the Northwest Regional Re-Entry Center. She had misused a debit card meant for business purposes, according to court records. Edwards had purchased goods from the Adoption Shoppe, an online business she owned, as part of a scheme to put the nonprofit's money into her personal bank account, records show. 

She has quite a past. She was relieved of her duties by the board of directors at the Portland Halfway House after having been accused of embezzling money from a halfway house in California. Edwards was scheduled to plead guilty last June to stealing from a program receiving federal funds. But she skipped the proceeding and turned up in Rhode Island, where she had gone to work as a community outreach specialist for a charity, Big Brothers Big Sisters of the Ocean State. Officials at the Rhode Island charity fired Edwards after learning she was accused of embezzlement in Portland. Afterwards, Edwards was found in a local hospital after what a federal prosecutor in Providence, R.I., said was a suicide attempt. 

Nonprofit Imperative gathers its information principally from public documents...some of which are directly quoted. Virtually all cited are in some phase of criminal proceedings; some have not been charged, however. Cites in various media: Featured in print, broadcast, and online media outlets, including: Vermont Public Radio, Miami Herald, National Public Radio, Huffington Post, The Sun News, Atlanta Journal Constitution, Wall Street Journal (Profile, News and Photos), FOX2, ABC Spotlight on the News, WWJ Radio, Ethics World, Aspen Philanthropy Newsletter, Harvard Business Review, Current Affairs, The Chronicle of Philanthropy, St. Petersburg Times, B, USA Today Topics, , Newsweek.com, Responsive Philanthropy Magazine, New York Times...and many more • Nonprofits: On the Brink (iUniverse, 2006)

School Fraud with No Oversight

by Gary Snyder

In the year leading up to the overhaul of Chicago Public Schools leadership, the school district was beset by troubling instances of fraud and employee misconduct, including $1.13 million in improper benefits paid to retired teachers, systemic abuse of the federal free lunch program at a West Side high school, and a scheme by a central office employee to use school funds to buy items he later exchanged for cash.  Employees took advantage of lax oversight in the free lunch program to enroll their children despite earning six-figure salaries. In other cases, employees were circumventing the district’s computer system to access pornographic material online or visiting dating sites, the report found. One assistant principal at an undisclosed high school who was also employed by a local travel agency steered more than $22,000 in school funds to the business, an obvious conflict of interest. Another employee – who admitted his children were using CPS computers while at college and living in New York – has since resigned.

Other allegations include:

•    A teacher misappropriating as much as $56,486 from money collected from parents in a tuition-based after-school program and more than $40,000 taken from an elementary school’s PTA checking account. The teacher was discharged and convicted of felony theft.

•    Another teacher took a vendor check in exchange for books and deposited it in his own personal bank account rather than the school’s account. The teacher was later charged with numerous counts of theft.

•    A vendor for a mentoring program at a high school was double dipping for the same services by being a subcontractor for another entity contracted by another public agency.

•    Loss of a valuable package of Chicago Transit Authority fare cards by an employee who said he left them on the dashboard of his unlocked delivery truck.

•    An elementary school teacher using a CPS email account to solicit sexual partners for himself and his girlfriend on Craigslist. The teacher received a six-day suspension and a written warning.

•    A CPS research technician who stored seven pictures of non-frontal male nudity on her CPS issued laptop. The technician was laid off and designated ineligible to be rehired.

•    A member of two Local School Councils whose wife’s company sold nearly $4,000 in sweatpants to both schools.  

•    An elementary school teacher charged with videotaping men and boys in a water park locker room.

The inspector general reported that between 2007 and 2011, payments for holiday, vacation and sick time totaling more than $1.13 million improperly were collected by 185 retired teachers hired as substitute teachers.

Nonprofit Imperative gathers its information principally from public documents...some of which are directly quoted. Virtually all cited are in some phase of criminal proceedings; some have not been charged, however. Cites in various media: Featured in print, broadcast, and online media outlets, including: Vermont Public Radio, Miami Herald, National Public Radio, Huffington Post, The Sun News, Atlanta Journal Constitution, Wall Street Journal (Profile, News and Photos), FOX2, ABC Spotlight on the News, WWJ Radio, Ethics World, Aspen Philanthropy Newsletter, Harvard Business Review, Current Affairs, The Chronicle of Philanthropy, St. Petersburg Times, B, USA Today Topics, , Newsweek.com, Responsive Philanthropy Magazine, New York Times...and many more • Nonprofits: On the Brink (iUniverse, 2006)