c. 2005 Religion News Service
(CHICAGO) When the Rev. Brian Lisowski was caught with an alleged prostitute last summer, parishioners at St. Bede the Venerable Catholic church began to suspect their pastor had been keeping secrets from them.
They were right _ he had a million of them.
When the Roman Catholic priest resigned in July 2004, the Archdiocese of Chicago said it discovered Lisowski had systematically skimmed more than $1 million from the parish in his five years as pastor. The theft was discovered when collections went up dramatically after Lisowski left.
While corporate scandals at Enron and Tyco have made headlines in recent years, churches like St. Bede and other nonprofits also have been victims of embezzlement. They can be particularly vulnerable, experts say, because of the level of trust given to employees and volunteers and their lack of sophisticated financial controls and oversight.
The embezzlement at St. Bede is one of dozens of high-profile cases involving churches in 2004.
_ In New York, the Rev. Charles Betts of Morning Star Missionary Baptist Church has been accused by prosecutors, along with the bookkeeper and her husband, of stealing $494,000.
_ In Rockford, Ill., Jannine M. McKee was sentenced to 18 months in prison for taking $140,000 from the Second Congregational Church, where she was the volunteer financial secretary.
_ A former bookkeeper at St. Rose of Lima Catholic Church in Layton, Utah, was charged with stealing more than $38,000.
_ Marie Wendel, business manager for Kolbe Catholic School in Cheektowaga, N.Y., stole $332,000, while at Grace United Church in nearby Buffalo, the church’s day care director, Bernadette Lucas, embezzled $235,000. Both pleaded guilty. According to the Buffalo News, the local district attorney’s office has prosecuted eight embezzlement cases at churches and nonprofits since 2003, totaling more than a $1 million.
GuideOne Insurance, which insures about 45,000 churches in the United States, has paid out an average of $2.9 million on about 1,800 theft claims in each of the last five years, according to Emily Abbas, a company spokeswoman. Those figures include theft by outsiders as well as embezzlement by people inside the church.
Most cases of church embezzling go unreported, said Kent Egging, pastor of Bethany Covenant Church in Mount Vernon, Wash. Egging, who has studied church embezzlement for his doctor of ministry degree program, says congregations are often embarrassed by what has happened, and are unwilling to go to the police.
“The biggest issue in a case like this is the violation of trust,” he said. “It’s not about the money so much. It’s about the trust.”
At one congregation, Egging said, the church’s treasurer stole more than $45,000. The money was in an account separate from a building fund that had been put on hold.
That separate account gave the treasurer two things that an embezzler needs to succeed _ access and no accountability, Egging said. “He could transfer funds into this separate account and then withdraw them,” said Egging, “and absolutely nobody knew.”
The treasurer created a false financial statement that covered up the transactions. Since he kept the books and reconciled the bank account, it was easy to avoid detection.
The embezzling was finally discovered when the building project started up again and the funds were gone.
Egging says most churches want to make things easy on volunteers. At many churches, volunteer accountants work at home and keep bank statements there as well, for their convenience.
“I would bet that most churches in America have some or a significant number of financial records in a box at somebody’s house or on somebody’s home computer,” he said. “A church wants to make it easy for a volunteer who’s working on church finances.”
Lisa Curtis of the Denver District Attorney’s Office economic crime unit says there are a number of steps that churches can take to reduce the risk of embezzlement. These include creating a system of checks and balances so that no one person has complete control over income, expenses and financial reports; having at least two people examine bank statements and returned checks each month; and paying for an annual audit by an accountant. She also suggests that churches require their treasurer or bookkeeper to take an annual vacation _ because it’s difficult to hide fraud during an absence.
Curtis urges churches and nonprofits to report any embezzling immediately.
“If you do not prosecute embezzlers,” she said, “they will get away with stealing from charity _ and they will continue their thefts at other organizations.”
The unnamed congregation with the building fund did file a police report, Egging says, but they did not file charges. Instead, the former treasurer agreed to repay the funds. Unfortunately, he reneged on the agreement and refused to pay.
Egging cautions against being too quick to offer forgiveness without consequences.
“It all sounds so loving at the time,” he said, “but this guy was a criminal and he stole the money and wasn’t intending to pay it back.”
(OPTIONAL TRIM FOLLOWS. STORY MAY END HERE)
Even the best precautions fail if someone is determined enough to get around them, says Jim Dwyer, spokesman for the Chicago Archdiocese. That has happened in five cases since 1997 in the archdiocese.
To prevent embezzling, the archdiocese publishes “best accounting practices” for its parishes, and also trains lay people to serve on parish financial councils. The parish books are audited when a pastor leaves or if the financial council notices something suspicious.
“If they see a spike in collections when someone _ a pastor, an usher, a volunteer _ is missing, they are trained to report it,” Dwyer said. “Those kinds of red flags trigger an audit.”
In the case of St. Bede, Dwyer says, the system eventually caught up with Father Lisowski. When confronted, he admitted what he had done and repaid more than $1.2 million to the archdiocese. He faces up to 30 years in prison if convicted of money laundering and theft.
Dwyer said reporting Lisowski to the police was essential for maintaining “good stewardship” of the archdiocese’s finances. “If you are going to be good stewards,” he said, “you have to hold people accountable.”
Still, he admits there is no perfect solution for preventing embezzlement at churches.
“I don’t know if anyone can come up with a foolproof system, given the large amount of loose cash we deal with,” Dwyer said. “When you deal with a church situation, you are dealing with people you hope are honest. Whether it’s a church or a corporation, you are still relying on the basic honesty of the people you hire and the people who volunteer.”
MO/RB END RNS
