[A] bookkeeper for a major Vermont nonprofit is under criminal investigation for embezzlement, according to the organization’s top executive, who says the amount taken could be in the six figures.
Hunger Free Vermont executive director Marissa Parisi said Tuesday that the organization believes the employee has been embezzling funds for a decade. Parisi said the damage was significant.
“We actually think the loss could be in the hundreds of thousands,” Parisi said.
Parisi said the case is under investigation by the Federal Bureau of Investigation. No charges have been brought. The FBI would neither confirm nor deny an investigation is under way, as is their policy. Parisi would not identify the employee, who she said has been terminated.
Parisi was alerted to the alleged embezzlement four weeks ago when the local bank contacted her about suspicious activity in the organization’s checking account.
Hunger Free Vermont typically keeps four months worth of reserve funds on hand, which Parisi and the board believed was fully funded. “When we discovered the issue, we realized that was not the case,” Parisi said.
“We’re lucky that we will be able to continue all of our programs, but not having our reserve fund is scary for us,” Parisi said.
The individual was fired after the discrepancies were discovered, Parisi said. Hunger Free Vermont alerted law enforcement, and is cooperating with federal investigators to determine the extent of the embezzlement.
According to Parisi, the bookkeeper has worked at Hunger Free Vermont for 11 years. The organization, based in South Burlington, has an annual budget of slightly more than $1 million. There are 15 employees.
Parisi said she has reached out to major donors to the organization to notify them of the situation.
According to a statement by Hunger Free Vermont, the organization believes the theft began in 2006 and as internal controls tightened over time, the employee’s strategy for stealing became more sophisticated.
“I’ve always been committed to a high level of accountability to our donors and the community.” said Parisi, who was hired as executive director in 2009. “Unfortunately, this employee went to great lengths to subvert our internal controls and has stolen money intended for our programs that end hunger. It is hard to comprehend how our former friend and colleague could do this to us and the wider community we serve.”
Organization officials said the accused employee used several methods to steal funds, including check forgery, falsifying financial statements, and recording checks made out to this person as other legitimate vendors in the organization’s accounting software.
Hunger Free Vermont works statewide running nutritional assistance programs for children, families and vulnerable Vermonters. Its mission is “to end the injustice of hunger and malnutrition for all Vermonters.”
“We just want to make sure that this issue, this crime that’s been committed against us doesn’t derail our programs,” Parisi said. The loss would not be covered by insurance.
“We are devastated to learn of the theft by our colleague who we worked closely with and trusted for many years,” she said. “Not only has this person endangered the service we provide for food insecure Vermonters, but also has committed a crime against the donors who trust us with their donations to do our vital work.”
Stuart Comstock-Gay, president and CEO of the Vermont Community Foundation, the state’s largest philanthropic organization, said that embezzlement like that alleged in the case of Hunger Free Vermont happens “almost not at all.”
While cases occasionally happen in Vermont in other sectors, he said, it is rare in nonprofits.
“As unfortunate as this is, it’s not a sign that there’s a raft of this kind of problem,” Comstock-Gay said.
He said he is aware of the situation at Hunger Free Vermont, and understands that the organization is taking steps to double check their accounts and remedy the situation.
“It’s also a message to everybody who runs any type of organization to pay attention to all of the protections you have in place,” Comstock-Gay said.
