Protecting your funds and equipment
We have seen a growing number of theft occurrences in youth sports organizations by trusted directors, officers, and other volunteers. Such theft can take the form of embezzlement or the taking of equipment. Media accounts of such activity are backed up by the recent claims paid out by our insurance carriers.
The primary reasons for volunteer theft are dire financial circumstances often attributed to personal financial problems and gambling addictions.
Youth sports organizations present the perfect opportunity for theft because most aren’t run as a true business and limited or inadequate controls are put in place. These organizations are often run by a small group of volunteers who have build up a great deal of trust among one another.
Below are some common sense controls that can help to limit volunteer embezzlement and theft of equipment
- Require a countersignature on all checks or checks over a certain amount.
- If you allow the use of credit or debit cards, make sure that the monthly statements are reviewed by someone who is not authorized to use the card.
- Collect checks instead of cash during fundraisers.
- Keep detailed inventory records of all equipment and require a log to be kept when equipment is assigned or checked out.
- Create an audit committee to review all financial records, account statements, and conduct an inventory of all equipment.
In addition to these safeguards, all sports organizations should carry a Crime Insurance policy that covers employee dishonesty, forgery and alteration, and theft of money and securities. Such a policy should be specially endorsed to cover theft by employees and officers.
