Battling Embezzlement, With Tips From The Confessed
06/21/11 4:33PM By Kirk Carapezza
(Host) Vermont's State Auditor is helping cities and towns fight embezzlement of public money - something that he says has cost local governments millions of dollars - by tapping the advice of former embezzlers.
At a conference Tuesday in Montpelier, State Auditor Tom Salmon invited confessed embezzlers to join him in training dozens of municipal, state and non-profit officials in fraud prevention.
Salmon says embezzlement is unacceptable, and he can tick off the possible ways to detect it.
(Salmon) "For one, it's tone at the top. It has to be a cultural commitment where people - not just those paying the bills - want to know about insuring a strong, internal control over cash. So, the basics of internal controls, with segregation of duties, with making sure that bank reconciliations are done by someone outside of the bill paying process."
(Host) Salmon says most cases of embezzlement involve a long-term trusted employee, which is why his office wanted to have experienced embezzlers share their stories with city and town officials.
(Salmon) "I think it was very telling to the people that it doesn't take a ton of extra work to prevent fraud. It just takes some increase in awareness of the certain weaknesses that could be existing right now."
(Host) Salmon says in Vermont and across the country there is a history of ignorance surrounding fiduciary duty. So his office is creating a ‘red flag checklist' that will help town governments and non-profits to change that.
Tuesday's conference was co-hosted by the Vermont League of Cities and Towns.