Faith-Based Daily Awareness Post 11 June 2024

These updates are shared to help raise the situational awareness of Faith-Based organizations to best defend against and mitigate the impacts from all-hazards threats including physical security, cybersecurity, and natural disasters.

Massive parish theft calls for more internal control, expert says

The Pillar reports that a Florida woman pled guilty to embezzling $775,000 from a Catholic parish.

In the article, Robert Warren, a retired IRS investigator and professor of accounting at Radford University recommended the following safeguards.

• Preventive Controls
  • Separation of duties – including several people in financial transactions and record-keeping
• Detection Controls
  • Reconciling bank accounts
  • Taking an inventory of assets

In April, The Pillar reported Florida woman facing trial for $700k parish theft, which involved a different woman at a different church.

Related Item from the IRS:

• Former church employee sentenced to pay restitution and serve two years in federal prison for defrauding church out of more than 450,000 dollars (2023)
• District man sentenced to 78 months in prison for schemes to defraud small business pandemic relief programs and the Archdiocese of Washington (2022)
• Ex-pastor of Orange County church sentenced to 14 years in federal prison for orchestrating $33 million con that defrauded investors (2021)

Analyst Comments:

As the above items indicate, Faith-Based Organizations (FBO) are often victims of embezzlement. FBOs should consider implementing, or improving, preventive and detection controls.

FB-ISAO’s  11 March 2024 Daily Awareness Post (DAP) highlighted an embezzlement story where a California church administrator stole $350,000.

The DAP provided Smart Church Management’s 10 Practices That Safeguard Your Church Against Embezzlement – Smart Church Management.

The DAP also provided the Church Mutual’s Preventing Fraud And Embezzlement pdf.