Let me introduce to you Ms. LeeAnn Dove. Most likely you have not heard of her. What makes LeeAnn worth noting is she managed to embezzle close to half of a million dollars from her employer Great Falls Landscapes over six years.
According to the Herndon Patch, Dove has been indicted on six counts of wire fraud, one count of mail fraud and eight counts of bank fraud. She faces 20 years in prison for each wire and mail fraud count and 30 years in prison for each bank fraud count. That totals to 380 potential years in prison.
So what happened? Did Dove run into financial difficulties? Did she have a sick child, spouse, or parent to take care of and support? It does not appear so. According to United States Attorney's Office Eastern District of Virginia Dove "added fake employees to the company’s payroll, whose paychecks she deposited into her personal bank account. During her six-year scheme, Dove also used company credit cards for personal purchases, including electronics, furniture, limousine services, concert tickets, and thousands of dollars in gift cards." I know you are asking, how did this go on for six years undetected? It is hard to imagine that the owners did not miss $500k from their profits. There are many potential reasons Dove was able to keep her scheme alive for this length of time including:
- Did Dove have check signing authority?
- Did Dove write checks and reconcile the bank accounts?
- Did any of the owners review the bank statements?
- Did any of the owners review the payroll?
- Did any of the owners review the credit card statements?
- Did Dove ever take vacation or let another employee assume her duties?
- Did anyone notice that Dove was living beyond her means?
What happens frequently with a long term trusted employee is they are given to much authority and no one reviews their work. With small organizations it is difficult to maintain strong segregation of duties, but it can be done with owner oversight. The impression given is that Dove was able to purchase items, pay bills, process payroll and have control over financial assets without answering to anyone. Unfortunately, this is a recipe for fraud. Strong internal controls, owner oversight and an intolerance of fraud tone from the top are excellent prevention measures.
This is so true. I write a blog, smallbusinessbandits.com, where I post stories about small business thefts like this one. It really makes me wonder why people are in business for themselves if they take no interest in where the money is going - the "numbers" part. Typically just having the bank statement sent to their house, or looking quickly at their cleared checks online would reveal these thefts instantly. Why earn it if you're just going to let someone steal it? Plus, we all pay higher taxes when people like Ms. Dove take money and don't pay taxes. Thank you for help educating people about employee theft. Sad how rampant it is.
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