Nonprofit Embezzlement Finally Stopped After 40 Months

August 28, 2014 Posted by Jessica Shofler in News, Nonprofits

EmbezzlementWendy Harper started to embezzle from her nonprofit employer within four months of assuming her duties as payroll supervisor. She wasn’t caught until 40 months later.

During her time as acting payroll supervisor at Harvest Management Group, a nonprofit that manages 18 properties for the disabled and elderly, Harper used her position to embezzle almost $600,000. She did this by giving herself raises and claiming 1.2 million miles worth of mileage reimbursements. This would have meant her driving 30,000 miles per month while working a desk job.

In February, she pleaded guilty to one count each of theft from federal-program funds and filing false tax returns. On Monday she was sentenced to a two-year prison term. She was also ordered to repay the money she embezzled and to pay about $125,000 to the IRS for filing the false income-tax returns. She could have been sentenced to up to 13 years in prison and received a fine of up to $500,000.

The Department of Housing and Urban Development and the IRS found that because of the embezzlement, Harvest Management is having trouble maintaining its 900 units and paying property taxes.

If you are a reader of this blog, you know that this isn’t the first and certainly won’t be the last time a nonprofit has suffered at the hands of an embezzler. The NonProfit Times has reported that the typical nonprofit organization loses 5% to fraud each year and that the median loss suffered from occupational fraud is $140,000.

Has your nonprofit suffered embezzlement? What was done about it?

NOTE: The information contained herein is not intended to be legal advice and the reader should know that no Attorney-Client relationship or privilege is formed by the posting or reading of this article which is also not intended to solicit business.

Casey Summar, Partner, The Law Firm for Non-Profits,1812 W Burbank Blvd, #7445, Burbank, CA 91506

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