Examining Instances of Embezzlement in Vermont

• In Event: Advanced topics - Forensics, Government and International Accounting

Abstract

Vermont has an embezzlement problem that needs to be understood so preventive or deterrence measures can be proposed. In this study, I examine distinct cases of embezzlement in Vermont organizations to better understand the traits of the perpetrators and the methods used to commit fraud. I replicate the data gathering and analysis methods of a nationwide study on embezzlement, the 2013 Marquet Report on Embezzlement (Marquet 2014), and focus specifically on cases in Vermont that involved more than $20,000 in losses and occurred since the passage of the Sarbanes-Oxley Act of 2002 through the end of 2014. I find that Vermont perpetrators tend to be middle-aged, female and hold accounting or finance positions. The type of organizations frequently victimized include government or non-profit entities and most perpetrators steal through the use of forged or unauthorized checks. In most cases, embezzlements occur because organizations lack a proper segregation of duties. To curtail embezzlements, Vermont organizations should separate the custody, recording and authorization functions regarding checks, employ forced vacations, conduct random audits and develop an effective tone at the top that demonstrates a commitment to an ethical environment.

Authors

• Tyler Miles, University of Vermont

• Barbara Arel, University of Vermont