Does the Penalty Meet the Deceit?
posted on: Friday, March 16, 2007
Does the Penalty Meet the Deceit?
By Gary Snyder
As those of you that follow the strengths and weaknesses of the nonprofit sector know, billions of dollars have been taken from those in need by trusted agency leadership. The regular e-newsletter, Nonprofit Imperative, has documented hundreds and hundreds of convictions of those in control being punished in some manner or another. I thought that it may be instructive to take a look on the disparity of sentencing based on the severity of the crime.
Just recently, five members of one of the largest nonprofit schemes—Baptist Foundation of Arizona—were sentenced. This was one of the biggest frauds perpetrated on contributors in the history of the charitable world. Eleven thousand, principally elderly, were taken-in by a Ponzi (pyramid) scheme. (Other similar nonprofit Ponzi schemes in the late nineties were the New Era Philanthropy Foundation-$135 million loss; Great Ministries International-$353 million loss). The $550 million was embezzled over several years by the Baptist Foundation, ending in 2002. While a significant amount of the money was regained from insurance claims, it was nevertheless a precursor of the current climate. Baptist Foundation fraud parallels the for-profit Enron activities resulting with Arthur Anderson executives paying $217 million to those defrauded and a number of accountants losing their licenses. The sentence: three of the four executives received probation and restitution; one was sentenced to prison.
Another noteworthy example of nonprofit greed was at the local United Ways. We can document that 7 agencies that intentionally miscounted or understated expenses and as far as we can tell there were no consequences. The sentence: of the twenty-one United Way agencies that have been involved with criminal activity totaling more than $17 million, sentenced varied. One took $102, 000 and received 7 years in prison, whereas another that took $72,000 received probation; and other that took $2.1 million got four years in prison; and yet another repaid $227,000 and was hired as a consultant to UW.
Schools are the up and coming center for nonprofit malfeasance. At the Roslyn schools in New York, about $11 million was taken by the superintendent and others. Some senior employees had the school district pay their personal credit card bills, which included more than $1 million in cash advances withdrawn from automatic teller machines, and pay for mortgages on luxury homes, personal automobiles and much more. Sentence: superintendent 4 to 12 years; another, one to three years in prison.
As the chart below shows, there is a significant disparity in sentencing. A $4,000 theft received an eleven year sentence whereas hundreds of thousand dollar embezzlements got either probation or restitution.
Some others:
Theft Amt.- Sentence -Charity
$300,000-restitution-Niles Schools/Parker Foundation
$135,000- 6 yrs. prison/restitution- Litchfield Performing Arts
$180,000-6 months prison- Paralyzed Veterans
$600,000-3 years prison-Systems United
$10,000-5 years prison-US Dept. HHS
$111,000-5 years prison/15 years probation-Humane Society South Coastal
$4,000-11 years prison-Washington Teachers Union
$300,000-10 years prison-Metro Ministries Loaves and Fishes
$100,000-10 years probation/restitution-Quincy College
$600,000-8 years prison-Super., Georgia State Schools
$235,000- 26 months prison; 5 years probation-Bristol Speech and Hearing Center
$20,000-20 years prison; 15 years suspended-Henrico County-Arthur Ashe PTA
$238,000-3 years probation-Macomb-Oakland Regional Center
$70-120,000-300 hours of community service-Progressive Training Associates
$2.3 million-4 years prison-Hyman Foundation
$3.6 million-5 years/restitution-African Christian Relief
$480,000-5 years in prison-Richmond Metro. Youth Soccer League
$400,000-2.25 years in prison-Cherokee Elementary School
$42,000-2-20 years-Upper Ohio Valley Italian Festival
$223,000-30 days in jail; restitution-Lower Currituck Volunteer F ire Department
$300,000-6-12 months-Our Lady Queen of Peace
$1 million-3.1 years; restitution-National Crash Analysis Center
$6 million-4.75 years prison-Prepared Table Charter School
$10,000-2 months jail-On Our Own
$875,000-18 months; restitution-North Bay Health Care Group
$48,000-5 years probation-Ensemble Studio Theatre
$500,000-1 year in jail-Long Island Schools for the blind
$500,000-13 months-SE Arkansas Community Dev. Corp.
$47,000-5 years in prison-Vietnam Veterans of America
$880,000-200 hours of community service-Whitney Museum
If you have a understanding of the inconsistency in sentencing or want to comment,
let us know.
Gary Snyder is the author of Nonprofits: On the Brink and articles in numerous publications. His email address: gary.r.snyder@gmail.com; website: http://www.garyrsnyder.com/
By Gary Snyder
As those of you that follow the strengths and weaknesses of the nonprofit sector know, billions of dollars have been taken from those in need by trusted agency leadership. The regular e-newsletter, Nonprofit Imperative, has documented hundreds and hundreds of convictions of those in control being punished in some manner or another. I thought that it may be instructive to take a look on the disparity of sentencing based on the severity of the crime.
Just recently, five members of one of the largest nonprofit schemes—Baptist Foundation of Arizona—were sentenced. This was one of the biggest frauds perpetrated on contributors in the history of the charitable world. Eleven thousand, principally elderly, were taken-in by a Ponzi (pyramid) scheme. (Other similar nonprofit Ponzi schemes in the late nineties were the New Era Philanthropy Foundation-$135 million loss; Great Ministries International-$353 million loss). The $550 million was embezzled over several years by the Baptist Foundation, ending in 2002. While a significant amount of the money was regained from insurance claims, it was nevertheless a precursor of the current climate. Baptist Foundation fraud parallels the for-profit Enron activities resulting with Arthur Anderson executives paying $217 million to those defrauded and a number of accountants losing their licenses. The sentence: three of the four executives received probation and restitution; one was sentenced to prison.
Another noteworthy example of nonprofit greed was at the local United Ways. We can document that 7 agencies that intentionally miscounted or understated expenses and as far as we can tell there were no consequences. The sentence: of the twenty-one United Way agencies that have been involved with criminal activity totaling more than $17 million, sentenced varied. One took $102, 000 and received 7 years in prison, whereas another that took $72,000 received probation; and other that took $2.1 million got four years in prison; and yet another repaid $227,000 and was hired as a consultant to UW.
Schools are the up and coming center for nonprofit malfeasance. At the Roslyn schools in New York, about $11 million was taken by the superintendent and others. Some senior employees had the school district pay their personal credit card bills, which included more than $1 million in cash advances withdrawn from automatic teller machines, and pay for mortgages on luxury homes, personal automobiles and much more. Sentence: superintendent 4 to 12 years; another, one to three years in prison.
As the chart below shows, there is a significant disparity in sentencing. A $4,000 theft received an eleven year sentence whereas hundreds of thousand dollar embezzlements got either probation or restitution.
Some others:
Theft Amt.- Sentence -Charity
$300,000-restitution-Niles Schools/Parker Foundation
$135,000- 6 yrs. prison/restitution- Litchfield Performing Arts
$180,000-6 months prison- Paralyzed Veterans
$600,000-3 years prison-Systems United
$10,000-5 years prison-US Dept. HHS
$111,000-5 years prison/15 years probation-Humane Society South Coastal
$4,000-11 years prison-Washington Teachers Union
$300,000-10 years prison-Metro Ministries Loaves and Fishes
$100,000-10 years probation/restitution-Quincy College
$600,000-8 years prison-Super., Georgia State Schools
$235,000- 26 months prison; 5 years probation-Bristol Speech and Hearing Center
$20,000-20 years prison; 15 years suspended-Henrico County-Arthur Ashe PTA
$238,000-3 years probation-Macomb-Oakland Regional Center
$70-120,000-300 hours of community service-Progressive Training Associates
$2.3 million-4 years prison-Hyman Foundation
$3.6 million-5 years/restitution-African Christian Relief
$480,000-5 years in prison-Richmond Metro. Youth Soccer League
$400,000-2.25 years in prison-Cherokee Elementary School
$42,000-2-20 years-Upper Ohio Valley Italian Festival
$223,000-30 days in jail; restitution-Lower Currituck Volunteer F ire Department
$300,000-6-12 months-Our Lady Queen of Peace
$1 million-3.1 years; restitution-National Crash Analysis Center
$6 million-4.75 years prison-Prepared Table Charter School
$10,000-2 months jail-On Our Own
$875,000-18 months; restitution-North Bay Health Care Group
$48,000-5 years probation-Ensemble Studio Theatre
$500,000-1 year in jail-Long Island Schools for the blind
$500,000-13 months-SE Arkansas Community Dev. Corp.
$47,000-5 years in prison-Vietnam Veterans of America
$880,000-200 hours of community service-Whitney Museum
If you have a understanding of the inconsistency in sentencing or want to comment,
let us know.
Gary Snyder is the author of Nonprofits: On the Brink and articles in numerous publications. His email address: gary.r.snyder@gmail.com; website: http://www.garyrsnyder.com/
posted by Gary at
2:48 PM
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