OPM Addiction

Since this is the biggest shopping week of the year, I thought it would be fitting to share research on a true-crime involving a school district’s chief financial officer (CFO) who had an apparent addiction to “Other People’s Money” (OPM).

The CFO had worked for the school district for seventeen years—and had been stealing their money for sixteen of them. And all the while, year after year, an independent auditor gave the school district’s financials a passing grade.

Weeks after the independent accounting firm issued a clean audit report; the FBI notified the school district their bank had reported irregularities.

One of the methods the ex-CFO used was to authorize over-payments to businesses. When refund checks arrived, he’d deposit those into his personal accounts. As is often the case in fraud cases, the ex-CFO funded his lavish lifestyle—personal travel, jewelry, private club memberships.

Rather than go to trial, the ex-CFO pleaded guilty to 35 state and federal charges of public corruption regarding the school district crimes AND two charges that he stole from a business who had hired him after his firing from the school district.

A federal judge sentenced the ex-CFO to over five years in prison for embezzlement, money laundering, and public corruption. Between the state and federal sentences, he’ll pay more than $1.3 million in restitution to the school district and close to $40,000 to the business he stole from.

After serving his federal sentence, he’ll be transported to a state prison to serve an 11 year sentence.

After his release, he’ll serve three years under supervised released. The state judge ordered that his retirement fund first pay his restitution debt before he can draw benefits.

Worth Mentioning: The school district sued the accounting firm that performed their annual audits. The case is ongoing. As a part of cleaning house after the embezzlement, the school district also replaced the Superintendent.

Here’s a similar crime you may have missed: Greed and the Perfect Audit

Do you know of a crime you’d like to share? Email me so we can discuss the details.

Source: U.S. Department of Justice, South Carolina Attorney General, The Post and Courier