Friday, September 26, 2014

It Took Over 4 Years To Detect A $2 Million Fraud At PBS

By Gary Snyder


The former finance director of a Public Broadcasting Service’s arm in Boston is alleged to have stolen more than $2 million. It took about four years to find it. He deposited more than 200 checks meant for PBS.  A lawsuit alleges he forged a PBS endorsement on the checks and presented the checks to Citizens Bank for deposit into his own account.

PBS contends that Citizens should have been aware of the fraud.  “Citizens Bank did not conduct any reasonable inquiry or question the appropriateness of the deposits when the checks were presented to Citizens Bank and accepted,” Federal Insurance said in the lawsuit.

No charges have been brought in the case, according to court records.

The alleged embezzlement came to light in a lawsuit filed in late September.
Federal Insurance, which covered PBS for employee theft, paid the nonprofit $2 million, the limit of the policy’s liability. The insurer is seeking to recover that money from Citizens, plus legal and other costs.

WGBH, a PBS station, was the victim of employee theft a few years ago. In 2010, a former accounting manager at WGBH-TV pleaded guilty to stealing nearly $500,000 from the station over nine years.

Such thefts deliver a blow to the reputations of charities, because they are built on trust and the expectation that the money they receive is used appropriately, said Chris Marquet, the owner of Marquet International, a Boston investigative firm that publishes an annual report on white-collar fraud.

“It’s never a good thing,” Marquet said. “They are probably no doubt going to have show the world that they have safeguards in place.”


Thefts from charitable organizations are fairly common, usually because they do not have the resources and structure for strict oversight, Marquet said. One in six major embezzlement cases in 2012 involved charities or religious organizations, according to Marquet’s study. (source)



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: Charity Navigator, Vermont Public Radio, Miami Herald, National Public Radio (NPR), Huffington Post, The Sun News, Atlanta Journal Constitution, Wall Street Journal (Profile, News and Photos), “Betrayal”, (a movie), NBC (on Charity Fraud…TBD), FOX2, ABC Spotlight on the News, WWJ Radio, Marie Claire, Ethics World, Aspen Philanthropy Newsletter, Harvard Business Review, Current Affairs, Charity Navigator, The Chronicle of Philanthropy, St. Petersburg Times, Board Room Insider, USA Today Topics, Accountants News, Newsweek.com, Responsive Philanthropy Magazine, New York Times, Portfolio Magazine, The Virgin Islands Daily News, NANKAI (China) BUSINESS REVIEW, National Religious Broadcasters newsletter, The Charity Governance Blog, American Chronicle, Palm Beach Post, Detroit Free Press, Oakland Press, Nonprofit World, Socially Responsible Business Forum, PNNOnline, Ohio Nonprofit Resources, Nonprofit Good Practice Guide, Nonprofit Startup Guide, Nonprofit Blog, National Coalition of Homeless Newsletter, Finance and Administration Roundtable Newsletter, MichiganNonprofit.com, CORP! Magazine, Crain’s Michigan Nonprofit, ncrp.org, PhilanTopic, Nashville Free Press, Nonprofit Law Blog, Seniors World Chronicle, Carnegie Reporter, Assoc. of Certified Fraud Examiners Examiner, msnbc.com, Worchester (MA) Telegram and Gazette, Carnegie Corporation of America, EO Tax Journal, Wikipedia: Non-profit Organizations; Parent: Wise Austin, Accountants News, Veterans Today, Answers.com, Far-roundtable, #Nonprofit Report, nonprofithelpnews, nonprofit news; National Enquirer, Northwest Herald, The HelpWise Daily, The #Nonprofit Report, Wikipedia (Nonprofit Organization), Answers.com, Nonprofits: On the Brink (2006) Silence: The Impending Threat to the Charitable Sector (2011)
Post a Comment