Week in and week out, hundreds of Louisiana Baptists faithfully handle the offerings and finances of their churches with integrity and honesty. However, some churches are not so fortunate and must deal with persons who have stolen funds – sometimes exorbitant amounts – from their coffers.
Note: Week in and
week out, hundreds of Louisiana Baptists faithfully handle the
offerings and finances of their churches with integrity and honesty.
However, some churches are not so fortunate and must deal with persons
who have stolen funds – sometimes exorbitant amounts – from their
coffers. While celebrating the faithful work of so many, the Baptist
Message offers the following article as a word of warning and as a
reminder to churches to implement sensible procedures for the handling
of funds. Such procedures protect the church as well as those handling
funds from actual – or accused – thefts.
When priest Brian Lisowski was caught with an
alleged prostitute last summer, parishioners at St. Bede the Venerable
Catholic church in Chicago began to suspect their pastor had been
keeping secrets from them.
They were right.
He had a million of them.
When the Roman Catholic priest resigned in July
2004, the Archdiocese of Chicago said it discovered Lisowski had
systematically skimmed more than $1 million from the parish in his five
years as pastor. The theft was discovered when collections went up
dramatically after Lisowski left.
While corporate scandals at Enron and Tyco have made
headlines in recent years, churches and other nonprofits also have been
victims of embezzlement. They can be particularly vulnerable because of
the level of trust given to employees and volunteers and their lack of
sophisticated financial controls and oversight, observers note.
The embezzlement at St. Bede is one of dozens of high-profile cases involving churches in 2004. For instance:
• In New York, the Charles Betts of Morning Star
Missionary Baptist Church has been accused by prosecutors – along with
the bookkeeper and her husband –of stealing $494,000.
• In Rockford, Ill., Jannine McKee was sentenced to
18 months in prison for taking $140,000 from the Second Congregational
Church, where she was the volunteer financial secretary.
• A former bookkeeper at St. Rose of Lima Catholic
Church in Layton, Utah, was charged with stealing more than $38,000.
• Marie Wendel, business manager for Kolbe Catholic
School in Cheektowaga, N.Y., pled guilty to stealing $332,000.
• Bernadette Lucas also pled guilty to embezzling
$235,000 while serving as church daycare director at Grace United
Church in Buffalo.
Such cases are not as rare as some may hope to
believe. For instance, in Buffalo, the local district attorney’s office
has prosecuted eight embezzlement cases at churches and nonprofits
since 2003, totaling more than a $1 million.
GuideOne Insurance insures about 45,000 churches in
the United States. In each of the last five years, the company has paid
out an average of $2.9 million on about 1,800 theft claims, a company
spokesperson said. Those figures include theft by outsiders as well as
embezzlement by people inside the church.
Consider also that most cases of church embezzling
go unreported, said Kent Egging, pastor at Bethany Covenant Church in
Mount Vernon, Wash. Indeed, congregations often are embarrassed by what
has happened and are unwilling to go to the police, said Egging, who
has studied church embezzlement for his doctorate.
“The biggest issue in a case like this is the
violation of trust,” he said. “It’s not about the money so much. It’s
about the trust.”
At one congregation, the church’s treasurer stole
more than $45,000, Egging noted. The money was in an account separate
from a building fund that had been put on hold.
That separate account gave the treasurer two things
that an embezzler needs to succeed – access and no accountability.
“He could transfer funds into this separate account
and then withdraw them – and absolutely nobody knew,” Egging noted.
The treasurer created a false financial statement
that covered up the transactions. Since he kept the books and
reconciled the bank account, it was easy to avoid detection, Egging
The embezzling was finally discovered when the building project started up again and the funds were gone.
Egging says most churches want to make things easy
on volunteers. At many, volunteer accountants work at home and keep
bank statements there as well, for their convenience.
“I would bet that most churches in America have some
or a significant number of financial records in a box at somebody’s
house or on somebody’s home computer,” he explained. “A church wants to
make it easy for a volunteer who’s working on church finances.”
Lisa Curtis of the Denver District Attorney’s Office
economic crime unit said there are a number of steps churches can take
to reduce the risk of embezzlement.
These include creating a system of checks and
balances so that no one person has complete control over income,
expenses and financial reports; having at least two people examine bank
statements and returned checks each month; and paying for an annual
audit by an accountant.
She also suggested that churches require their
treasurer or bookkeeper to take an annual vacation – because it is
difficult to hide fraud during an absence.
Curtis urged churches and nonprofits to report any embezzling immediately.
“If you do not prosecute embezzlers, they will get
away with stealing from charity – and they will continue their thefts
at other organizations,” she explained.
The unnamed congregation with the building fund did
file a police report, but they did not file charges, Egging noted.
Instead, the former treasurer agreed to repay the funds. Unfortunately,
he reneged on the agreement and refused to pay.
Citing that example, Egging cautioned churches
against being too quick to offer forgiveness without consequences.
“It all sounds so loving at the time, but this guy
was a criminal and he stole the money and wasn’t intending to pay it
back,” he noted.
However, even the best precautions fail if someone
is determined enough to get around them, church leaders acknowledge.
“I don’t know if anyone can come up with a foolproof
system, given the large amount of loose cash we deal with,” said Jim
Dwyer, a spokesperson for the Catholic Archdiocese. “When you deal with
a church situation, you are dealing with people you hope are honest.
“Whether it’s a church or a corporation, you are
still relying on the basic honesty of the people you hire and the
people who volunteer.” (RNS)