Audit Finds Abuse of Education Dept. Credit Cards

I was once sat in on a petty theft case where a poor man who stole a $ .99 pack of potato chips and got a few months in jail. Occasionally you'll see bookkeeping types do time for kiting schemes - where government money is used "on the float" to pay personal expenses. They were going to pay it back....

This from The Washington Post:

U.S. Department of Education employees inappropriately used government credit cards to purchase $49,500 worth of goods and services, including meals, items at clothing stores and rental cars, for personal use, according to a review by the department's inspector general.

Auditors examining a sample of business travel expenses for fiscal 2006 found $18,256 in inappropriate charges made by 34 employees. The charges included payments to clothing retailers and restaurants near their homes or office.

Twenty-nine people used bank cards to withdraw about $17,600 more than allowed under the department's travel allowance for meals and incidentals. Four department workers made $13,570 in bank card withdrawals when they weren't on business travel. One logged 44 withdrawals totaling $8,560.

It could not be determined yesterday whether employees paid for the personal expenses they charged. The cards are issued to individual employees who are responsible for paying the bills but then seek reimbursement.

The July 1 report calls on the department to improve oversight of travel charge cards, which are only to be used for official travel, including to schools, conferences and training. "Inappropriate use of the travel card . . . represents abuse of a Government-provided resource, and compromises the integrity of the Department," the report says....

...The inspector general's office said the department failed to follow recommendations it laid out in a 2002 inquiry of the travel card program that also found lax controls. The new report noted that some employees who made inappropriate charges six years ago were flagged for problems this time.

..."We concur with the IG's findings and have a corrective action plan in place to address the IG's concerns," said Samara Yudof, spokeswoman for Secretary of Education Margaret Spellings....

It is unclear if the department's corrective action will include criminal charges for theft by unlawful taking.

The Fraud Triangle: Opportunity + Pressure + Rationalization

One of the things we teach prospective principals at UK is how to safeguard funds through sound fiscal controls. It requires teamwork and shared duties.

Embezzlement is an inside job committed by a trusted employee who is knowledgeable about school business affairs. They exploit their knowledge for personal gain. Like all economic crime it is premeditated. Offenders usually steal again. This “white collar” crime is rarely reported. Even when it is, charges are not always filed.

One sign of fraud: Being caught on video stashing the loot in your pocket.

This from the Cincinnati Enquirer:

Police: Principal caught on tape

INDEPENDENCE – Clint Green was fired as principal of St. Cecelia School here after he was caught on video pilfering cash from collection baskets, authorities confirmed Friday.

“The weekend of March 1-2, (Green) was taped taking cash from the collection baskets,” said Independence Police Capt. Tony Lucas, spokesman for the department.

Kenton County and Independence police installed cameras in the parish rectory after Father Mario Tizziani, the parochial administrator, found what he described as “discrepancies” between parish donation records for 2007 and the amounts that parishioners claimed they’d donated, the Covington diocesan newspaper, The Messenger, reported Friday.

On March 3, the school fired Green, a 33-year-old Fort Mitchell resident, who had been hired as principal in 2006 after teaching at the school for two years.

“In the video, it appears that that (Green) was holding envelopes up to the light to see whether they contained a check or cash,” said Lucas, who is also a member of St. Cecelia’s parish.

Envelopes that appeared to hold cash went in Green’s pocket, the video indicated, while those with checks went back in the collection basket, Lucas said.

“It has been brought to our attention by members of the (St. Cecelia) finance committee that restitution of $3,000 has been made,” Lucas said Friday. “Arrangements are being made to collect further amounts.”

No charges have been filed against Green, who Lucas said has been “very cooperative.”

Felony charges can be brought for crimes involving theft by unlawful taking of $300 or more....

Photo: Video and a copy of a letter to parish at KyPost.com.

Northern Kentucky Principal Fired

Accused of financial misconduct

INDEPENDENCE - Felony criminal charges are being pursued by Independence police against Clint Green, who was fired Monday from his job as principal of St. Cecilia School.

Green, 33, was terminated "due to financial impropriety," according to a letter sent to parents Tuesday by the Rev. Mario Tizziani, the parish's parochial administrator.

Independence Police Captain Tony Lucas said Wednesday that the department was notified by the parish a week ago that funds, believed to be in excess of $300, were missing from either the church or school. Lucas said two detectives have been assigned to the case.

Theft by unlawful taking in Kentucky is a felony when the amount exceeds $300...

...According to a report obtained from the Administrative Office of the Courts, he was found guilty of shoplifting (under $300) in 1999 in McCracken County in western Kentucky. He received a 30-day suspended sentence and two years of probation.

Fitzgerald said the Diocese was aware of that conviction when Green was hired...

...Green was hired as principal in 2006 after teaching at the school for two years. St. Cecilia has roughly 300 students in grades P-12...

...Green is listed on the Heritage Foundation's PolicyExperts.org Web site as an expert on issues such as church/state relations, parental education choices, religious freedom, public school financing and entrepreneurship...

This from the Cincinnati Enquirer.