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Bookkeeper Fraud: Tennessee First Presbyterian Church is a Victim
From:
Chuck Gallagher -- The Business Ethics Expert - Keynote Speaker Chuck Gallagher -- The Business Ethics Expert - Keynote Speaker
For Immediate Release:
Dateline: Greenville , SC
Monday, September 12, 2016

 
There is no point in dwelling on the “sickness” of bookkeeper Connie Parker. Between 2007 and July 2016, she stole at least $600,000 from a Tennessee First Presbyterian Church. She allegedly used the church’s credit card to charge everything from lavish vacations to household furniture.  This is accounting fraud or better stated bookkeeper fraud and likely one that is never expected.
Bookkeeper FraudAfter the many years of stealing, the axe finally came down on Parker. This resulted in two immediate outcomes: a hearing was held in front of a judge and the judge issued an injunction restraining Parker from selling or disposing of any property or assets. The church is scrambling to recover as much money as possible.  This is just part of the aftermath of bookkeeper fraud.
The second outcome, almost (I hate to say) predictable, was that she was checked into the hospital. Parker’s lawyer has told the court that his client is “very sick.”
The sickness is not, apparently, a ruse but it was how she got caught. When Parker got sick she could not pay the church’s bills and keep the books. A well-intentioned congregant took over her duties and almost immediately discovered an unauthorized $4,500 charge on a church credit card.  How is bookkeeper fraud caught?  When you can’t keep up the fraud and someone else takes over the outcome is discovery!
Parker apologized and later paid that money back. However the administrators at First Presbyterian Church, sniffing suspicious activities began to look through past invoices and were horrified to discover more than $400,000 had been put on church cards.

Bookkeeper fraud unintentional? I think not!

We could possibly and compassionately “excuse” Connie Parker if her sickness was a long-term disease that impaired judgment. However, she adroitly moved funds from different church accounts to pay off her credit card bill every month. In addition, she spent money on gifts for others and worse, she apparently paid herself bonuses of nearly $60,000.  Once you start down that slippery slope of unethical choices – whether it’s bookkeeper fraud or some other fraud – the amounts get bigger and the fraud gets worse.
The lawsuit is seeking $720,000 in restitution and, good luck with that. Most of the money is undoubtedly long gone and how does the bank or the Tennessee Bureau of Investigation recover things such as paid vacations and numerous visits to spas?
Though Connie Parker is the culprit, the church has no one to blame for this long-term case of fraud and theft but itself. It is a bitter pill to swallow perhaps but this case of unethical behavior leading to criminal activity must be shared by the church hierarchy. The real challenge in cases such as this is to examine policies and procedures, or a lack thereof, and to understand some basic truths.
The first of these many truths is that anyone, in any organization can commit fraud if there are no checks and balances, no formal reporting structure, no random examinations and “blind trust,” rather than strict reporting.  Amen!  Bookkeeper fraud is easy if there are no checks and balances or internal controls.
Though a setting such as a church is generally not seen as an organization in the classic business or even nonprofit sense, there is a surprisingly large sum of money changing hands each month. Often, positions such as church or synagogue treasurer are voluntary, elected from the membership. These volunteers are typically hands-off in their approach to the actual business workings of the religious institution. They rely on the bookkeepers to spew out reports from month to month, then the reports are “droned” at board meetings.
Unfortunately, applying a layer of “religion” or spiritual belief to the bookkeeper screen, or the feeling that “so and so would never commit fraud against a church!” Is not the same as having a financial committee reviewing every significant purchase.
The second “truth” I might bring up is that no one within any organization is irreplaceable. While many long-term employees are loyal and strictly adhere to policy, 10 years of performing the same bookkeeping service to the same organization can sometimes lead to carelessness or deviation. What did the church do to ensure Connie Parker was carrying out their strict wishes? Certainly, the major credit card companies can alert people in the organization above the bookkeeper level to notify them of any unusual activity. This check was not in place. Connie Parker was allowed free rein.
Ethically, I would be remiss if I did not talk about policy and training. This is an important truth to share as well. Was Connie Parker made to sign an ethical agreement every year? Was there a strict policy in place (I’ll condense this!) that stated that any fraudulent transactions would immediately result in termination and legal action? If not, why not? Ethical training for any religious institution of at least a “significant” size should be mandatory.
Teaching good ethics, the choices and consequences, is not the same as a gentle parable. It is a no-nonsense set of expectations of why ethical behavior is so important.
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