Protect Your Club Against Embezzlement
At least once each year, new stories emerge of youth sports organizations facing difficult times following the actions of dishonest individuals.
A Hastings, Minnesota man was charged with five counts of felony theft after being accused of taking $113,000 from a youth sports league in 2013.
Trenton, New Jersey witnessed a former Pop Warner volunteer be sentenced to 27 months in prison after a wire fraud conviction in 2014 – his restitution totaling $560,000.
Most recently, in 2015, a Spokane, Washington man pled guilty to second degree theft charges and is serving jail time after stealing more than $100,000 from his child’s soccer organization.
While there may not be one perfect solution, there are a handful of small, inexpensive measures that can be taken to prevent incidents from happening in the future.
Separation of Duties
A simple way to create an obstacle against theft is to set up a separation of duties within the organization. For example, one individual is responsible for ordering items, while a second individual is responsible for completing the invoice for those items.
For any club expenses, require two authorized club administrators to sign the check to ensure the payment is legitimate.
Even in small organizations where separating duties might not be a possibility, volunteers should make their accounting records as transparent as possible so other interested members can check the finances at any time.
Hire A Professional
Especially in volunteer-based organizations, administrators aren’t likely to be expert accountants. Bringing in an outside company to review the yearly figures will raise any potential red flags that require further analysis.
Set limitations on each position within your organization so an individual is not able to remain in the same seat indefinitely. Knowing that a new election is occurring annually and a fresh set of eyes will be going over the financials can be enough to deter theft.
Small steps such as these can help deter a potential threat to your organization’s finances and create roadblocks to catch an attempted theft. What other tactics have proven helpful in your organization?