Where Most Needed

John J. O'Connell, 36, a lobbyist in Harrisburg, Pennsylania, pled guilty Wednesday to a single count of mail fraud in a plea bargain agreement.  Investigators had found that Mr. O'Connell had embezzled about $170,000 from a nonprofit that he founded, Pennsylvania Law Watch (not a 501c3, so no Form 990 is available).  As executive director, he had sole control over the group's checking accounts.  The group had raised over $700,000 in its few years of existence in support of tort reform.  The 6 foot 7 lobbyist was a prominent figure at the state capitol. 

Mr. O'Connell previously admitted to a gambling problem which led to a personal bottom in 2004, and he voluntarily went to the IRS in August of that year admitting his misappropriation. 

A report from the Australian Institute of Criminology ("Gambling as a motivation for the commission of financial crime") offers some fascinating data on the patterns of gambling-related crime.  Gambling was identified as the second most common motivation for fraud crimes (greed was the most common).  The study reports that gambling-motived fraud was more likely to be directed at an employer (43% of cases) and the amounts were considerably lower than greed-motivated fraud (six figures vs. seven figures).   The typical perpetrators of gambling-based fraud were younger men and older women.  Mr. O'Connell was just about the average age for the male fraud criminal. 

With their relatively lax controls and typical small size, charities and advocacy groups provide ready opportunities for fraud; their main protection is their relative lack of resources.