Tag Archives: Embezzlement

Embezzlement: Is It Our Dirty Secret? (a five-year update)

Five years ago I posted an essay about embezzlement at history organizations while I was on AASLH Council and in the midst of recovering from the financial fraud perpetrated by its chief financial officer.  History News recently published my updated version and included a sidebar by John Dichtl to describe the fraud at AASLH.  When it occurred, AASLH wanted to be open and transparent about the situation and use it to help others, and yet, we often found ourselves silent and frustrated because it could have jeopardized the criminal investigation and lawsuits.  Now that the CFO has been sentenced, AASLH can discuss it more openly (although some aspects are covered by confidentiality agreements). Please share this article with your colleagues to help them tighten their financial controls and reduce the chances of embezzlement at their organizations.

By the way, this issue of History News has lots of good articles for historic sites, including:

  • “The Many Voices of a Historic House” by Jane Mitchell Eliasof (about the effort reinterpret the Crane House in Montclair, New Jersey as an African American YWCA from 1920 to 1965)
  • “Like a Phoenix: Opportunities in the Aftermath of Disaster” by Samantha Engel (about the fire that occurred during a construction project at the Whaley Historic House Museum in Flint, Michigan)
  • “A Please Touch Historic House Tour” by Christine Ermenc, Christina Vida, and Scott Wands (a case study of an award-winning program at the Strong-Howard House in Windsor, Connecticut).

History News is one of the best benefits of membership in AASLH.  Along with a quarterly copy in the mail, they recently added online access through JStor and send members a pdf version in advance via email. I’ve been a member for nearly 40 years and if you want to find consistently useful ideas for managing your historic site or house museum, there’s no better place than AASLH.

AASLH/MMA Meeting Recovery and Recap

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It took me several days to recover from my conference hop in Detroit last week.  I’m not sure why I ended each day exhausted. Was a joint meeting of the Michigan Museums Association and the American Association for State and Local History too rich for my brain cells? Was it the non-stop activities from 7 am to 9 pm? Was it the Cobo Conference Center, so large that I had walk two city blocks to a session after entering the building? No matter the cause, I was a mindless zombie for a couple days afterward but I did have a great time.  I’ll definitely be at AASLH next year in Austin, Texas.

The use of Twitter grew tremendously at the conference.  I heard that more than 1,500 tweets went out from sessions, so many that AASLH created a summary via Storify (and further proof that Twitter isn’t just for the young digerati).  I experimented with Periscope, which provides a live video feed on Twitter. I’m still getting the hang of it (first rule: be sure you’re pointing the phone camera at the scene, not looking down at your feet, when you’re fussing with the phone to start recording).  I was skeptical about its ability to attract an audience but surprisingly lots of people watched it immediately (Periscope provides statistics both during and after recordings; 96 people watched my video of the exhibit hall). You definitely will want to see how you might want to use this smartphone application for promoting events, lectures, and programs at your museum or site. Everywhere on the web a Tweet can go, a Periscope can go, too.

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Tom Segrue’s plenary presentation about Detroit’s history also included observations about the impact of racial segregation, manufacturing, and economic redevelopment has had on its successes and failures, which is a cautionary example to other cities around the country.  My hometown of Rockville, Maryland is much smaller than Detroit, but I immediately saw the parallels around segregation and redevelopment for the last 50 years. His book, The Origins of the Urban Crisis, has mostly attracted the attention of academic historians (and a couple prestigious awards), but preservationists and public historians should learn about him as well because of his analysis of downtown revitalization efforts and gentrification. His presentation is now available free from AASLH via SoundCloud and iTunes.  AASLH has provided another dozen audio recordings of sessions from this meeting, many that relate to house museums and historic sites, and in a month the webinars of selected sessions will be available. Thanks, AASLH!

I was involved with a couple sessions during the conference and in case you missed them, I’m sharing the handouts of resources and contact information that we distributed:

I also learned a lot, both in the sessions and in the hallways chatting with friends, so I’ll be sharing those in future posts so this annual meeting will continue to live on for a few more weeks.

Video: Avoiding Employee Theft

In this 2:22 video, this video by The Hartford, Gene Marks has two suggestions for reducing embezzlement and employee theft (yup, it happens at museums and historic sites).  When he discusses “inventory,” think “collections.”  And be sure that your staff takes vacations.

You’ll find more details at Five Signs Your Employees Are Tampering with Your Accounts.

Washington Post Investigates Financial Fraud at Nonprofits

Form 990 diversionDuring the last couple months the Washington Post has been running a series of articles on financial fraud at non-profit organizations using the annual Form 990 report.  According to their research, more than a thousand organizations have disclosed “a significant diversion” of assets (such as embezzlement) since 2008.  “Significant” means it exceeds $250,000 or five percent of the organization’s assets or receipts, so minor occurrences of fraud are not revealed.  Charitable organizations (such as museums and historic sites) were by far the most common victims, representing about 65 percent of the total.  Educational institutions were the second most common victims, but fell far behind at about 15 percent.

The three most common forms of financial fraud are: Continue reading