This week my heart goes out to the women of Gamma Phi Beta Sorority. To be defrauded of $400,000 of the money you have worked hard to raise for your chapter house by an alumna you trusted is a truly saddening betrayal of trust to all Greek members on this campus.
For anyone who has not seen the story yet, the gist of it is as follows. The President of Gamma Phi Beta’s House Corp has recently been indicted by a federal grand jury on charges of fraud and money laundering. These charges stem from the woman in question, an attorney no less, allegedly submitting false invoices to Greek Resource Services for furnishings that were supposed to be purchased for the new chapter house, but in actuality never were. According to the indictment, the woman transferred the checks received from Greek Resource Services through a fake business account into her personal financial accounts.
I sincerely hope that the money will be returned to its proper accounts within the Gamma Phi Beta chapter and Greek Resource Services and that this crime does not keep this chapter of accomplished young women from opening their new house for recruitment on schedule this August.
However, this sordid affair serves as a cautionary tale not just to other Greek houses on campus, but also to every student organization and in the long-term, every student on campus. Every type of organization, from the smallest of book clubs to the world’s biggest corporations, are vulnerable to loss by the unethical behavior of their members. Finding it and bringing it to light in time to stop major outflows of cash requires the work of layers of procedural safeguards and employees who are trained to spot suspicious behaviors by their coworkers.
As anyone who’s taken an accounting class from this University’s nationally recognized department can attest to, the fraud triangle consists of motivation, opportunity and rationalization. Unfortunately, there is little to be done to keep a person’s greed from motivating and rationalizing his or her behavior.
However, much can be done on the part of organizations and individuals to cut off the opportunity for losses to occur. More than one individual should be put in charge of keeping an accurate accounting of an organization’s finances at all times. These accountings should occasionally be subject to review by the entirety of the executive board of the organization. Finally, the old saying of “trust in God but lock your car” should be taken to heart by all officers in an organization. Trust your employees (or members or alumni volunteers) but don’t assume they are all above the siren call of temptation. Frauds like this most recent one can be carried out by just one bad actor, but they can also be stopped by any number of good ones.
Leigh Terry is a senior majoring in economics. She is the Opinions Editor of the Crimson White.
