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2 Bethany College employees fired after embezzlement scandal

Updated: Tuesday, October 1 2013, 03:30 PM EDT

By: NEWS9

BROOKE COUNTY, W.Va. --


Two Bethany College employees have been fired after an investigation revealed more than $500,000 was embezzled from the school.

One employee who managed the cashier's office was fired after allegedly admitting to the crime. The director of finance for the college – who was responsible for reconciling the account in question – has also been terminated.

Brooke County Prosecutor Joe Barki said the cashier's office manager worked at the college cash window, where the embezzlement occurred.

Barki said the suspect admitted to the stealing money while still employed at the college, but he did not wish to elaborate further as this is an ongoing investigation.

Bethany College President Scott D. Miller said the employee was immediately fired after admitting to the theft, and the matter was referred to the prosecutor's office. Barki said charges are likely to be filed in the next week.

Barki said the investigation stemmed from the results an outside audit. The investigation lasted several weeks and Barki said the alleged crime is part of a larger "criminal enterprise." He said at least two other people who did not work at the college are also suspected to be involved.

Stay with NEWS9 and WTOV9.com for continuing coverage as details become available.



WEB EXTRA: Unedited Letter From Bethany College President To Alumni

Oct. 1, 2013 -

“With the fall semester fully underway and a wonderful Homecoming weekend just completed, our 174th academic year is off to a strong start.  Bethany is in a strong financial position, within a competitive academic environment as well as a diverse and engaging student body.  Recently, I have shared with you via the State of the College and the President’s Letter the many positive accomplishments of the campus community.
 
Unfortunately, not every bit of news is positive and I am writing to inform you of a negative development we have had.  Through the course of annual financial audits by our outside audit firm, we learned that Bethany has been the victim of a crime. More particularly, the audit process revealed that more than $500,000 in cash was unaccounted for in the accounts relating to the College’s cash window -- an area used to cash student and employee checks.  Working with the Board of Trustees and our outside accounting and legal advisors, we immediately launched an investigation that resulted in a confession from a Bethany employee who managed the cashier’s office.  The employee who admitted stealing the money was immediately terminated and the matter was referred to the Brooke County Prosecutor for criminal prosecution.
 
The prosecutor asked the College in writing to refrain from communicating about the incident in any way until today, in order to accommodate the investigation. Investigators quickly determined that the systematic thefts from the cash window were linked to ongoing criminal activity in Ohio and authorities there have now acted to seize some assets. By working with the authorities, Bethany College not only helped identify and break up the criminal activity, but enhanced the likelihood to recover a significant portion of the stolen funds.
 
No student or employee funds were impacted by this theft. We do expect to recover the majority of the College’s loss through the efforts of the criminal prosecution and through insurance.  In any event, the loss will not have a material impact on the financial strength of the College, nor will it adversely impact our operations this year or into the future. Nonetheless, we fully recognize that this incident is not acceptable, and all of us involved in leading Bethany apologize for this breach of trust and poor performance that has adversely impacted the institution that we love.  
 
It is apparent that the theft was possible because of ineffective oversight of certain financial controls relating to the cash window. The Director of Finance of the College, who was responsible for reconciling the account in question, has also been terminated.  
 
With the guidance of the Board of Trustees, we have taken several steps to ensure that this does not happen again.  We closed the cash window and have replaced it with banking services provided through WesBanco. We asked Eileen Greaf, our new Chief Financial Officer who has substantial college financial management experience, to work with our outside auditors and conduct a review to ensure that all appropriate financial systems and controls are in order. To strengthen our legal oversight we have established a new board position, Chair of Legal Services Committee, which Board member and attorney Mark Chernenko will assume. Another member of our Board, G. William Newton, an experienced financial executive, has become Chair of the Audit Committee. We have also strengthened our financial team with the transfer of Deidra Hall-Nuzum to the finance department.  Deidra is a Bethany graduate and an accountant who has been an outstanding employee for several years.
 
We appreciate your ongoing support of Bethany College and welcome any questions you may have about this incident or any other matter.

Sincerely,

Scott D. Miller, Ph.D.
President of the College"

2 Bethany College employees fired after embezzlement scandal


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