13th December 2017
Home » Bisnis Online » Stealing in the Helpless Nonprofit Charity – Why does it Happen?
April 5th, 2017 Cat: Bisnis Online

It is Christmas time, and people have been giving generously – sometimes to large well-established charities, sometimes to small soup kitchens and food pantries to help the homeless out with a meal. People often worry about how in a large charitable organization, the little contributions they make to just disappear through mismanagement. In Scotland in Cornwall though, people giving to a small charity a few years ago were surprised to read in the news how a clerk at that organization chipped away at the nonprofit charity’s receipts – it came to a quarter of $1 million over several years. And here in the US, a modest soup kitchen and Virginia, that tried to help the local homeless with a hot meal in winters, found one day that about $50,000 was just missing from its bank. The homeless who lined up for their meal that evening had to go back hungry. It was so sudden, the modest organization did not even have the time to find backup funds. Over the next few months, they obtained alternative funding from local churches, and found out who was behind the fast: one of the management committee.

More and more, the humble nonprofit charity is falling victim to fifth columnists who work from within; these happen not just at the major international charities either. They happen at your local PTA, or children’s club. They often run on mutual trust among the community members and the office bearers. They don’t have the funds for proper financial controls or special auditing. Since it is all run on work volunteered by the neighbor next door or the church helper, no one wants to make a big fuss over tallying accounts and offending anyone. Small charities are not even required to file an annual return. When something happens, like a volunteer quietly pocketing half the annual budget to make up for being laid off at work, they have no choice but to just close down and disappear without a trace.

Wehear it all over the place these days. In Atlanta, a local residents’ association that had around $50,000 set aside for street improvements and park upgrades, found that the treasurer stole it all. A Toys for Tots program in Tennessee had to close down when a respectable volunteer, a former armed services serviceman, just stole everything. And on it goes. This kind of mindless fraud, actually adds up: in tens of billions of dollars each year. And the small nonprofit charity, usually begun on a promise of good faith, just pathetically closes down when is mercilessly targeted. Of course it isn’t the charity itself that actually suffers; it is the poor who would have benefited. So why do people do this?

Don’t the people who work in nonprofit charity organizations see the risk in trying to steal from their neighbors? However will they continue to live in that community? Well sometimes, when there is a lot of money in front of you, you tend to block out what could happen if you fell for temptation. They never think of it as actual stealing; they always plan for a little luck with money later on, but it never actually happens as planned. In the difficult economic environment today, the chances of this kind of thing happening are all the more possible. The charities don’t have enough money to hire enough staff to keep books properly, and the people who do remain working, are saddled with the extra work; and these people tend to feel that the charity “owes them” extra money for the extra work.

One of the best things that small nonprofit charity organizations can do to hedge against such catastrophes, is to take out theft insurance. It has saved the life of more than one philanthropic organization. These charities often try to keep such events from getting public out of fear that no one else will be willing to donate to them when they learn that they mismanaged funds. But the opposite tends to be true usually. When potential donators and patrons hear of responsible actions in the aftermath of a theft, it usually only redoubles their faith in charitable work.

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