Professor Elam

Weekend March 12, 2016

Hondo is a small town of 8,000 directly west of San Antonio.  But fraud has been uncovered in this otherwise quiet community.

Frances Bendele has been replaced as Treasurer of the donated funds. $304,907 had been raised bu the group.   

Bendele was expected to deliver a check in that amount.  But she never appeared. She was in a one car accident, now claiming amnesia and a total loss of memory. Bendele, 68, is a person of interest in an ongoing Texas Ranger investigation. A review revealed checks wrting to Bendele herself.

Moral of the story – most white collar crime is an inside job. While Frances deserves her day in court, it appears she was tempted as there were literally no internal controls. She was simply handed the money, expected to deposit and account for it. This is why a division of duties is a necessary component of  proper internal control.  At a minimum a third party should have performed a bank reconciliation which would have revealed the first sign of trouble.