Putting in plans to stop booster club embezzlement before they ever begin is a great way to keep up with your booster club security. While it’s not the most fun topic to discuss, it is an important one that should be addressed.
Booster club embezzlement happens all of the time, so you should never blindly believe that it couldn’t happen to your group. You never know who has tried sticking their hand into the money pot or trimmed a few numbers to keep you none the wiser.
This is one of the biggest reasons why it’s important to trust but verify and keep some great guidelines in place to prevent theft before it happens.
Why We Should Stop Booster Club Embezzlement
When you steal from a booster club, you’re stealing from a nonprofit organization that helps many students, so it’s like you’re stealing from all of them at once. Not only that but now the money has to be re-earned. But, to keep the group on track, the money actually has to be earned back twice. Once to recoup what was lost and another to get them back on track after the financial derailment.
What makes it even worse is that now the booster club and the school have to come up with and enforce much stronger guidelines and code of ethics to keep it from happening again. But as everyone knows, trust is hard to gain back after it’s been broken. With so much distrust in a booster club, it could crumble due to the pressures.
So the theft not only takes from a nonprofit that helps students, it has to be regained twice and could ultimately lead to the dismantling of the booster club. If the booster club disbands, it won’t be able to help any future students, meaning the theft did way more damage then a few missing dollars.
Booster Club Embezzlement Guidelines “Code of Ethics”
To stop booster club embezzlement, or at the very least lessen the chances, it’s important to set up some guidelines designed to help with the booster club management. Some great ones to consider adding include:
Don’t allow a single person to handle the booster club finances.
By dividing the financial task to two or more people, you now have multiple people keeping a record of the monies. This allows for checks and balances to ensure that the numbers add up.
- Give one person the responsibility of counting money that’s deposited into the bank.
- Give another person the task of writing checks to vendors.
- Another person could be the one in charge of keeping the books and internal audits to make sure that the numbers add up.
The division of labor is one of the most effective strategies to mitigate booster club embezzlement
Rotate Booster Club Officers Regularly
This is something that should be discussed within your booster club bylaws. A rule as to how many back to back terms as an office a person can have. Many times, the opportunity for embezzlement starts with a person who has had a lengthy control over the finances without interruption.
By rotating officers out, you break up the opportunity to embezzle long term and when the new officer is introduced, they can run an audit to ensure that the numbers look accurate. If they don’t, a small investigation can be done to find out why. This is one of the easiest ways to stop booster club embezzlement.
Make a rule that all monies collected are immediately counted and deposited after the event
Booster clubs often have a lot of fundraisers where they can make large amounts of cash in hand by the end of the event. This can be really tempting when sitting on someone’s counter or table at home.
After the event is over, 2-4 (or more) people should sit at a table, and count out the cash one by one to determine how much money is there. When everyone agrees to the amount of cash sitting before them, they should write on an envelope the amount, and give their initials, or signatures to show that they signed off and agree that it was X amount.
The envelope should state how much is inside and the cash should immediately be deposited into the envelope and sealed. Everyone should make a small note about how much money was raised so that they can double check the accuracy of the treasures report at the following meeting.
After the money was counted and agreed upon, the cash should be immediately dropped off at the bank. For instances where the bank is closed for holidays, late hours, or weekends, then a rule should be in place stating that the money must be deposited within a given timeframe. The less time the money spends with an individual, the better.
Require double the signatures to stop booster club embezzlement
By requiring two signatures on every check to pay vendors and two endorsements for every withdrawal or change to the booster club bank account you can also help stop booster club embezzlement because now there are more eyes on the account and finances.
Stop booster club embezzlement by purchasing insurance
A fidelity bond (also known as a commercial crime policy) won’t cost much in the long run, but it is an insurance that helps to cover the losses from embezzlement and theft. If you aren’t able to stop booster club embezzlement 100% the least you can do is get this policy on the books to make sure that IF it happens, you can still support a booster club with this policy in place.
Download reports to software
A little more time consuming, but a great idea nonetheless is to take all financial records and reports and upload them to some booster club software. By doing this you not only get a digital copy of statements in case something goes wrong and the paper copies are lost or destroyed, but you can also give access to multiple people. Even if they don’t have access to edit the numbers, and to simply view it, it’s still more eyes on the finances and more eyes means better record keeping.
With so many different ways to help stop booster club embezzlement before it begins, your booster club can be pretty secure in knowing that it’s safe and protected. Working together to keep up with the code of ethics is an important job and one that helps the booster club during its entire lifetime.