Often church fraud happens when someone does their job in isolation. When you don’t have anyone helping you with the work or reviewing your work, there is less help to resist the temptation to steal or “borrow” from the church.
Try Googling “Church Embezzlement” and the name of your state. You will be shocked! Here’s what I saw:
- $324,000 stolen from churches in Tabor and Lesterville, South Dakota
- $126,000 stolen from churches in Elk Point, South Dakota
- $260,000 stolen from church in Rapid City, South Dakota
- $60,000 stolen from Lakota churches in South Dakota
What you notice first are the large dollar amounts. Surely these must be mega churches handling millions of dollars in donations each year, right? Wrong! Most of these are small churches in small towns where everyone knows everyone, and they put all their faith in one person to care for the finances. It appears that most of the time, the person stole by simply writing checks from the church’s checkbook.
If you want to better protect your church being stolen from and making it into the newspaper headlines, here’s my advice.
- Independent Eyes on the Bank Statement: Someone who is not responsible for keeping the accounting records should regularly see the bank statements. This is especially helpful if the bank statement includes check images. If it costs extra to get those check images, it’s worth it. If you can’t get those check images, the person keeping the books cannot be a check signer.
- Independent Eyes on the Bank Rec: Whether someone independent performs the bank rec or someone independent reviews it, that second set of eyes is invaluable. The bank rec brings in what was recorded in the accounting records to compare to that bank statement.
People seem to struggle when isolated. A supportive community can really bring out the best. Bringing more trusted people into the financial processes will take some pressure off your church treasurer and usually bring out the best in them.