Embezzling on the Rise...With Women at Front of Curve?

Accused but not yet charged with pilfering more than $1.5 million from the tourism bureau in Palm Beach County, Donna Duffer may be the latest of a growing breed of entrepreneurial woman: one who embezzles from her employer.

"It's a very common phenomenon," said Barry Strock, president of a management and systems consulting firm in Albany, N.Y., that advises companies on how to protect themselves against embezzlement. "Anecdotally, I see this happening all over the country."

In Palm Beach County, Preston Mighdoll, chief economic crimes prosecutor in the State Attorney's Office for 13 years, is amazed at the number of such crimes he's seeing and the escalating amounts of money stolen.

When Mari Lampman of Lake Worth was arrested last year and charged with embezzlement from the home builder she worked for, Mighdoll thought the $1.2 million she purloined "was mind-boggling."

Now he has a half-dozen cases pending in which the amount stolen is $1 million or more.

Embezzlement by women skyrocketed 80 percent between 1993 and 2002, even slightly exceeding the number of those crimes committed by men in 2002, according to a New York Times analysis of federal data.

Experts say women are tapping the company till for several reasons. Some have a vice, such as a gambling addiction or compulsive shopping. Duffer racked up debts from online gambling, her attorney said. Others may have incurred large medical bills or made a bad investment and are desperate for cash.

"It's usually a matter of need or greed," said Strock, who consults primarily with not-for-profit organizations and governments.

Mighdoll sees some women stealing because they covet the lifestyle of the people running the company. Take Wendy Thompson, 31, of Lake Worth. She was sentenced last year after pleading guilty to stealing about $600,000 from her employer, a Boca Raton construction and development company where she was a project accountant. Thompson got five years in prison, followed by 10 years' probation.

Thompson thought if she dressed like her more affluent co-workers she would be accepted by them, her attorney at the time, Margaret Broz, wrote in a sentencing memorandum. So she embezzled from the company.

Still, her alleged thievery, and even that of Duffer, pales in comparison with that of which Linda Corra is accused. She was charged in April with misappropriating money from the Center for Hematology in Boca Raton, where she was a bookkeeper for 12 years. The total: $6 million, a Palm Beach County Circuit Court embezzlement record, Mighdoll said. Among Corra's purchases: a $1.5 million Boca Raton home, two Boynton Beach townhouses and a 38-foot boat.

Corra, 49, may enter a plea in the case, perhaps in December. She has paid back about $4.5 million, prosecutor Frank Castor said.

The Association of Certified Fraud Examiners released a study this year of 1,134 occupational fraud cases investigated from January 2004 to January 2006. The median loss, regardless of gender, was $159,000. Many of Palm Beach County's accused female embezzlers, besides Corra and Thompson, have been stealing on a much grander scale lately.

Among the women who have been charged or convicted this year with large-scale stealing from employers:

* Lampman, 53, pleaded guilty in June to grand theft plus a computer-related crime and was sentenced to 15 years in prison.

She was the bookkeeper at BHD Corp., a North Palm Beach-based home builder. She made out more than 100 checks to herself, spending thousands of dollars on dog clothing, doll collections and jewelry.

The company's losses forced it to lay off 20 employees. The judge in the case called the magnitude of the fraud "monumental."

* Sharon Kay Smith, 47, formerly of North Palm Beach, was charged in May with writing more than 400 checks totaling $402,817 on the account of Quality Swimming in Boca Raton to herself and her own company. Smith was a bookkeeper for eight years at the swim lessons company. Her case is pending.

* Silvia Barnard, 34, of Palm Beach Gardens, was busted in March and charged with transferring money from attorney Cari Podesta's office trust account to her own bank account. Barnard was Podesta's assistant. She subsequently pleaded guilty to grand theft, admitting that she took $241,000 from her boss. She was sentenced to four years in prison plus probation and ordered to pay restitution.

Barnard told the judge that she used the money to make a down payment on a house, two cars, furniture, "a little bit of everything."

* In June, Vickie Stetson, 37, of Jupiter was charged with embezzling $99,245 from a Boca Raton plastic surgeon's office where she worked as a patient coordinator for two years. She told police that she also stole $3,153 from her next employer, a dental clinic in Boca Raton, according to court records.

Stetson forged Dr. Patrick Graham's signature on credit checks she took from his desk, then deposited them in her bank account, police said. She also diverted money to her daughter's bank account, and she billed some patients for services they did not receive in order to conceal the withdrawals she made from the doctor's account, according to police. She told police that she was dependent on prescription drugs, especially Percocet, according to court records. Her case is pending.

Women tend to steal smaller amounts over a longer period of time, studies show. Because men dominate most company hierarchies, they have access to more of the organization's resources and their thefts are larger. The median loss in frauds committed by men was double that incurred in frauds by women in the cases studied by the fraud investigators. In the cases they studied, men accounted for 61 percent of the crimes.

Strock said it's not surprising that women are embezzling so often.

"In most institutions I find the Marthas," he said. "They're usually women who don't show up in the organization chart. The Marthas are the clerks, the bookkeepers, the mail people, the secretaries."

As such, these women are the linchpin of organizations, and they often make deposits and withdrawals of money and know how things work, Strock said.

"The reality is most bookkeeping jobs in an office tend to be women, and with that comes trust," Mighdoll said. "Most of the people who commit these types of crimes are first-time offenders."

The fraud investigators' survey found the same thing: Fewer than 8 percent of their embezzlers of either gender had prior criminal convictions.

In nearly 30 percent of the cases reviewed in that study, the theft was not turned over to police. The median loss of money in those cases was only half that in those cases referred to police.

Some companies and organizations don't get police involved because they "don't want to impair their image," Strock said. And sometimes they handle the problem internally because the amount taken is small, Mighdoll said.

The fraud examiners' study found that small companies endure disproportionate losses from embezzlements. The median loss at firms with fewer than 100 employees was $190,000 per scheme, compared to $159,000 overall, the study concluded.

Implementing fiduciary checks and balances can result in additional expenses that small firms resist, Mighdoll said. "Most of these companies are not set up to do that."

Companies and organizations that enable one employee to become indispensable by being the only one who, for example, knows how to prepare financial reports, are among those at risk, Strock said. If he comes across an organization with financial irregularities that has an employee who never takes a vacation and is unusually nice, "I get really suspicious," he said.

"They have a cigar-box mentality of running the business," Strock said of some not-for-profit groups with which he has worked. "If you leave the cookie jar without the lid on it, people tend to take the cookies."

The workplace thefts studied by the fraud examiners' group found that only one defendant in 351 cases was acquitted; more than 73 percent pleaded guilty and about 15 percent were convicted at trial.

Recovering the loot, however, was more difficult. About 42 percent of victims got back nothing; 23 percent got less than one-quarter of what was stolen.

Palm Beach County victims fare similarly, Mighdoll said. "Generally, we cannot find the assets."

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