Misericordia program offers advice to nonprofits to guard against theft
DALLAS TWP. — Luzerne County District Attorney Stefanie Salavantis is tired of seeing thefts from charities and nonprofits landing on her desk.
So with the help of some of the region’s top organizational accountants and state Rep. Karen Boback, she has devised a plan to help stop them.
“I was seeing so many of these cases, and it was getting overwhelming, and I thought something needed to be done,” Salavantis said.
Wednesday evening marked the second in a series of presentations on how to help eliminate thefts from charities and other nonprofit groups.
Held at Misericordia University, the presentation reviewed steps and procedures that can help nonprofits protect themselves.
Misericordia Professor Fred Croop led the forum, along with John Nonnemacher, of Snyder & Clemente accountants.
They said the first — and most important — thing an organization should do is to regularly reconcile its accounts.
According to Croop, all bank reconciliations should be reviewed monthly, with two separate members overseeing reconciliations and statements. That way, it would be much more difficult to falsify any invoices or statements. He also suggested that those reconciliations be compared to the monthly treasurer’s report.
“We want everything to tie together, to be compared so that you corroborate evidence,” he said.
Some other ways to help reduce theft include using two signatures on checks — something Salavantis said her office does. When questions arose about what to do if a signee is out of town, Salavantis recommended having three non-related individuals able to sign checks. The DA also advised against signing blank checks in bulk.
Nonnemacher said charities should make sure that bank accounts are set up using the organization’s EIN number and not a member’s Social Security Number. In many cases of organizational theft, bank accounts had been linked to a member’s own Social Security Number, Salavantis added, which should prompt an immediate “red flag.”
Other possible “red flags” to watch for include individuals who are living beyond their means, never take time off, or provide vague answers to questions.
Another warning sign: late charges or penalties being placed on an account for unpaid bills even though funds are supposed to be available.
It was also recommended that groups rotate members’ positions to stop complacency and reduce the chance for theft to occur.
Boback, R-Harveys Lake, said charities need to educate their members on theft prevention and how to be accountable for funds.
In addition to the presentation, Croop and his students have created a manual on preventing theft. It can be downloaded and viewed for free via the university’s website, misericordia.edu.
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