For Small Nonprofits, Embezzlement Is a Wound

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Stole-my-heart

October 26, 2015; KELO-TV (Sioux Falls, SD)

NPQ has written many times about the fact that embezzlement thrives in informal situations, which is a good description of many small nonprofits. But in such organizations, the damage done to internal culture and external reputation may prove hard to heal. Nonprofits that take the issue on with transparency may avoid some of that damage; in such situations, trust is the coin of the realm.

Aaron Wimmer, until recently the executive director of the Sioux Falls-based Family Visitation Center, has been charged with one count of grand theft. He turned himself into authorities and was released on a personal recognizance bond pending trial. Police noted during their daily video briefing that Wimmer has been making restitution and that full restitution to the local charity may be complete as soon as this week.

Authorities estimate that Wimmer stole more than $40,000 over several years. Wimmer, 40, began embezzling small amounts from his employer in 2011 by using a company credit card for personal expenses. Sioux Falls Police stated that Wimmer’s thefts escalated in 2014 and 2015, but did not say how the thefts escalated or how the stolen money was used.

Financial irregularities were discovered by Family Visitation Center (FVC) staff and board members in August 2015 and were reported to authorities who began investigating. Wimmer resigned from FVC almost immediately upon being informed of the investigation and has cooperated with authorities.

FVC, formerly affiliated with Avera McKennan Hospital in Sioux Falls, became an independent nonprofit organization in 2009. With a budget of about $600,000, FVC provides a safe environment for supervised visitation of children of adults involved in contentious divorce, domestic abuse, substance abuse, and/or child abuse situations. In addition to philanthropic support and payments from parents, FVC receives contractual payments from courts when supervised visitation is ordered by a judge.—Michael Wyland

Disclosure: FVC is a longtime client of Sumption & Wyland.

  • wensilver

    Mr. Wyland – NPQ has written a few things on Sandusky’s Second Mile children’s charitable non-profit. Seeing that non-profits here in PA are under the auspices of the Office of Attorney General, and TSM was never investigated – yet it raked in huge amounts of donations over the years – one simply wonders.

    Especially when CEO Dr. Jack Raykovitz and his wife pulled down a 6 figure salary from TSM – and Dr. Raykovitz also held a full-time position as a licensed child psychologist in private practice.

  • Thanks for noting NPQ’s coverage of The Second Mile, Jerry Sandusky, and Penn State. Rick Cohen wrote about my governance analysis of The Second Mile before I became a newswire writer for NPQ:

    https://nonprofitquarterly.org/2011/11/29/lessons-to-be-learned-from-sanduskys-second-mile-charity-issues-in-nonprofit-governance/
    I’ve written a few pieces on the scandal since I joined NPQ as a newswire writer, and, of course, Rick and others have also written on the subject.