Alleged Defrauding by Individual to the Tune of $500,000 (Furnishing a Sorority)

[exlurker]

http://www.al.com/news/tuscaloosa/in...raduate_s.html

Jennifer Elizabeth Meehan, 38, has been indicted by a federal grand jury. Meehan allegedly stole about $500,000 by defrauding a supplier of sorority house furnishings.

Allegedly she “was tasked with furnishing the University's [Alabama] new Gamma Phi Beta house, the largest in the sorority's national history. . . . Meehan was president of the House Corporation Board of the Epsilon Lambda Chapter of Gamma Phi Beta Sorority in an unpaid, volunteer capacity and was tasked with furnishing the sorority house between September 2013 and March 2015.”

(I’m only guessing, but maybe she’s no longer a member in good standing of Gamma Phi Beta? )

[AZTheta]

I am editing my post because it may be misleading the way I first wrote it:

NOT the first time this has happened, unfortunately.

Now I'll be even more unpopular when I write my opinion on Housing Corporations that are staffed by volunteers. NOTE: what I am about to say is not what happened to the GPhi alumna/situation referenced in the articles above. OK, here it is so feel free to flame away:

I think that the days of volunteers running Facility Corporation Boards are long gone. Women today simply don't have the time to volunteer to run a facility - it's big bucks and big business, extremely time consuming, and should be done by those who have knowledge, experience, and TIME to do it. I speak from extensive personal experience. In my opinion, housing should be managed by the fraternities/sororities, professionally.

Note that I'm not going to share my personal experiences here, so don't bother asking. Suffice it to say that I make my opinion based on data and facts from my own time on a Corp Board. NEVER AGAIN. Oh I am so tempted - but I won't.

No system of checks and balances, one person writing checks/access to $ - this is what can and does happen. That's a fact, Jack.

And Jen - yes, the Striesand effect indeed. This should be put on blast instead of kept quiet. It happens in every organization, Gamma Phi Beta has nothing to be ashamed of - nothing at all. It happens to all of us.

ETA: please note that in this particular case, the woman did NOT write checks against an account, she committed wire fraud.

[AOIIalum]

If you are following your GLO's operational and financial procedures, it minimizes the chance of fraud. As a former HC President myself, there were so many checks and balances that it was overwhelming. Note that I am NOT complaining. They were there for my protection and the sorority's protection.

As we're seeing here, it's a recipe for disaster when someone tries to cheat the established procedures or even just lets things slip because there aren't enough warm bodies to ensure compliance. I can't imagine that was the case at Bama, but I don't know or claim to know any more that's been published in the articles linked here. It's a sobering reminder of what can go wrong when it comes to Greek Housing management. It also should be a wake up for all groups to review their current HC policies and how they can be improved. What can we learn from this to keep it from occurring again? What were the red flags? Who dropped the ball, or multiple balls, in this case?

You still need local representation (back to those checks and balances again!) but I agree with AZTheta that professional management of sorority/fraternity housing is the way to go. Liability is a real thing, folks, and sadly Gamma Phi is now living that nightmare. Whether your chapter just has a closet full of possessions or a multi-million dollar property, management is best done by closely vetted professionals. NOT by a local alum who conveniently has their own business specializing in just what the local HC needs.

[TriDeltaSallie]

How in the WORLD did she think no one would figure this out?

[33girl]

ONE person can write checks?

Good grief, we needed two signatures on a check to go to GC Murphy and buy pomps and toilet paper.

[thetalady]

Originally Posted by 33girl

ONE person can write checks?

Good grief, we needed two signatures on a check to go to GC Murphy and buy pomps and toilet paper.

Requiring 2 signatures means squat to the bank. It is strictly for internal policy.

[SWTXBelle]

It looks like more than merely taking chapter money -

"The majority of her alleged crime wasn't taking the sorority's chapter money - it was wire fraud . . . The bank fraud charges come from a separate scheme in which Meehan allegedly opened a bank account under a fraudulent business name under which she submitted more phony invoices to Greek Resource Services."

[navane]

Originally Posted by 33girl

ONE person can write checks?

Good grief, we needed two signatures on a check to go to GC Murphy and buy pomps and toilet paper.

According to the article, she was submitting fraudulent invoices to the furniture company for reimbursement and had set up a fake business account. The article does not mention anything about her being a sole signer to a checkbook - that is, she was allegedly submitting invoices to a vendor, not cashing house corp checks.

I only comment on this so that we don't have everyone go off speculating that this house corporation was negligent in allowing one signature on checks. Our international headquarters staff has sent representatives to the chapter and I'm sure the federal investigators will sort it all out.

[Titchou]

Delta Gamma requires ALL house corporations to use our Fraternity Housing Corporation bookkeeping service. They collect all the money from the chapter and pay all the bills. They do the tax returns. The local volunteers just handle the day to day operation of the house and vote to approve expenditures. In this day and time, it just makes sense to have the professionals handling the money.

[AnchorAlumna]

Originally Posted by 33girl

ONE person can write checks?

Good grief, we needed two signatures on a check to go to GC Murphy and buy pomps and toilet paper.

Does GC Murphy still exist??

[33girl]

Sadly, no Missing the home of the $5 all purpose party shoes.

[AnchorAlumna]

Originally Posted by 33girl

Sadly, no Missing the home of the $5 all purpose party shoes.

Oh, OK. Our GC Murphy closed many, many years ago...35? We still wish we had our Hill's Department Store back.
Sorry for the hijack!
Carry on....

[Kevin]

A third internal control can be added to the requirement for double signatures on checks--that the treasurer maintain physical possession of the checks when he or she is not a signer on the account, a third officer handles that. The more checks, the better.

Trust no one.

[honeychile]

Without going into details, my chapter had a similar problem. The alumna in charge of our Housing Corporation used the money for personal trips to the Convention, and other personal expenses. Our Housing Corporation went from roughly $500K to nothing in three years. To this day, I feel that she was in cahoots with the accountant. Suffice it to say, she is no longer a member of Alpha Delta Pi.

[ColdInCanada11]

Originally Posted by honeychile

Without going into details, my chapter had a similar problem. The alumna in charge of our Housing Corporation used the money for personal trips to the Convention, and other personal expenses. Our Housing Corporation went from roughly $500K to nothing in three years. To this day, I feel that she was in cahoots with the accountant. Suffice it to say, she is no longer a member of Alpha Delta Pi.

Wow, I am speechless. I don't understand how anyone can do that to their organisation.