Risk Report -- July 2018

Locals fuel gambling habits with embezzlement

  • Macomb Township, Michigan: A former Dakota High School Spanish teacher pled no contest to embezzlement and has been ordered to repay $30,000 to the Chippewa Valley School District for stealing from homecoming dance sales. The teacher was a student activity coordinator and oversaw ticket sales for the homecoming dance and other activities. The homecoming ticket sales should have brought in about $30,000, but she deposited only $11,000 into the school account. A school trip to Camp Tamarack should have brought in $13,000 in ticket sales, but she deposited only about $500. A search of the teacher’s classroom revealed empty deposit envelopes and casino receipts. A review of casino records showed she had spent more than $90,000 in 2016 playing penny slots. In addition to repaying some of the stolen funds, she will also serve two years’ probation and must seek treatment for gambling. 
  • Saginaw, Michigan: An employee of a substance abuse and mental health treatment center in Saginaw Township, Michigan, stole more than $328,000 to fuel a gambling addiction. The employee, who served as an internal accountant at the center, committed the theft by forging company checks between 2015 and 2017. After pleading guilty to embezzlement, the former employee was sentenced to five years’ probation, a year on an electronic tether and told to repay what she stole. The employee voluntarily enrolled in Gamblers Anonymous. During the time of her embezzlement scheme, the employee won $80,000 in Michigan Lottery prizes, one of them while on break from the clinic.

Two local medical providers targeted by embezzlers

  • Marquette, Michigan: A northern Michigan health care provider was not satisfied with a judge’s order of probation for a former employee who pled guilty to embezzling $230,000. In her victim impact statement, the business owner was concerned the theft did not result in a jail sentence and the judge subsequently sentenced the former employee to 180 days in jail. The embezzlement scheme, which lasted from May 2013 to February 2017, involved fraudulent credit cards opened in the owner’s name, theft from deposits, paying personal credit cards with business funds, forging the owner’s name on checks and manipulating records to hide the losses. The business owner took public action to protect other businesses and to “make sure she didn’t do it again.” 
  • Grand Rapids, Michigan: After serving nearly three years in prison for a 2014 embezzlement conviction from a Plainfield Township health spa, a 33-year-old woman went right back to embezzling – this time from a Grand Rapids medical day spa. As the front desk receptionist, she was able to steal almost $50,000 after just five months of freedom. Coupled with her previous heist of $55,000, the former employee now faces a maximum sentence of 15 years for the second offense. Just because you are hiring for an entry-level position does not mean a background check is unnecessary. Start your background investigation plan here.  

Security ennui a risk to your medical data | A survey conducted by Kickstand Communications found that 87 percent of healthcare workers admitted to sharing sensitive medical information using non-secure email. In fact, the survey found that healthcare workers are 36 percent more likely to “share regulated data such as patient information and credit card information via non-secure methods…than those working in financial services.” Sixty percent of respondents across industries said they “do what is easiest”, making a mockery of investments in security tools, two-factor authentication, complex passwords and training. If/when a breach occurs, the fact that employees are circumventing security protocols places liability on the employer.  

Concerned about your IT security? Use this tool developed by our newly combined firm, Trivalent Group, to find out your next best security steps. 

Fraud can happen to anyone. If it happens to you, the best next step you can take is to leverage the support of professional fraud investigators and forensic accountants. To request an investigation, click here

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