Where Most Needed

With the benefit the Internet, it is possible to see more of the pattern of charity insider fraud around the country.  It is not limited to large national charities.   Often these stories are from smaller newspapers.  That doesn't necessarily mean that fraud is more prevalent in smaller towns—it is just more likely make the papers.  Here are some recent examples:

• In St. Paul, Minnesota, Pa Paulette Vang pleaded guilty to embezzling $265,000 from Asian Women United of Minnesota (EIN 41-1801991 Form 990), an organization helping victims of domestic abuse.  She set up different bank accounts in the organization's name and was able to transfer money into them and then to herself without oversight.  Gambling was the reason.  The group's executive said that criminal and credit checks were run at the organization, but to no avail in this case.  (Story: St. Paul Pioneer Press)
• In Corpus Christi, Ray Gomez, former director of a free cafeteria, admitted to taking $300,000 from people who thought they were giving to Corpus Christi Metro Ministries (EIN 74-2247261 Form 990), his former employer.  The thefts took place over a five year period, and Mr. Gomez escaped notice because he generally collected small donations and did not engage in extravagant spending.  (Story: Corpus Christi Caller Times)
• In Louisville, former radio personality Todd Kelly Smith and his mother Sybil Smith pleaded not guilty to a charge that they stole $75,000 to $150,000 from the Todd Kelly Foundation, which was set up after the DJ claimed in 2001 to have been diagnosed with Lou Gherig's disease ALS.  Local television station WAVE3 confronted Kelly earlier this year (five years later) and has him on-camera showing no symptoms.  And there is no Form 990 for the foundation: the television report suggests that the paperwork for IRS charitable status was never filed.  (Earlier story: Ex-Radio Personality Under Scrutiny for Allegedly Faking ALS.)
• In the reaction stories to Todd Kelly affair, one recalled the story of Carol Braun, controller of Goodwill Industries of North Central Wisconsin (EIN 39-1144913 Form 990) for 26 years, who in 2003 pleaded no contest to a charge of embezzling more than half a million dollars to cover gambling debts.  (Which led me to this interesting "draft" report by Mary Dodge  of the University of Colorado at Denver about Women Who Commit White Collar Crimes MS Word Document 136Kb.)

These stories echo some recent articles here that separately dealt with the association of women and gambling with charity embezzlement.