Recovering From Embezzlement: One PTO’s Comeback Story

A PTO shares how it is recovering from an embezzlement incident.

by PTO Today Editors

02/07/2016

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re’s been quite a run of PTO and PTA embezzlement stories in the news lately, and it’s scary stuff. Groups worry that it could happen to them and wonder how they’d get through it.

Well, Karlyn McConico knows.

The PTO president at Avondale West Elementary in Topeka, Kan., McConico recalls the day in late March when the group’s secretary told her a rumor was floating around that the group was out of cash and wouldn’t be able to fund its upcoming annual carnival.

“We were like, ‘What?’,’’ McConico says. As far as she knew, the finances were in order. “We had just had a board meeting,’’ she adds.

But McConico decided to investigate and took a solo trip to the bank where she was confronted with the harsh truth: The PTO account was nearly empty. Because the matter is under investigation, McConico was unable to share details of what exactly was missing or who is under investigation. But she did sum up that day by saying, “To have the carpet pulled out from underneath you, it was sickening.’’

McConico, along with the group's vice president and secretary, decided to tackle the problem head-on. They reached out to the administration and made a quick decision to contact the police. Then they called an emergency meeting for parents to inform them of the lost funds and to let them know the carnival, which was scheduled for April 19, might not take place. The parents immediately began to rally and said the carnival couldn’t be canceled. An emergency carnival meeting was scheduled for the next day.

“We saw a tenfold increase in the number of parents involved,” McConico says. “Parents mobilized to get the word out to their contacts and employers, and social media was flooded with announcements about our predicament.’’

In addition, local media began covering the story. Before long, donations were pouring in, including two gifts of $2,500, one from a local company and the other from a person who had attended Avondale Elementary in the 1960s and wanted to make sure the kids got their carnival.

McConico says the carnival took place on schedule and was one of the best the school had ever seen. Because of the generosity of the community and profits from the actual sales at the carnival, the PTO made between $7,000 and $8,000 and will have more than enough to cover its other end-of-year events.

Now looking back, McConico says she and her team realize that they could have done more to ensure that financial best practices were, well, really practiced. “Routines and traditions get established and they don’t always allow for transparency,’’ she says.

They are now focused on turning that around. “We are restructuring our bylaws and other protocols have already been assigned,” McConico says. “We have two parties on the checks and two doing the resolutions of bank statements.”

One other piece of advice from McConico? If you are worried that your group doesn’t have solid financial best practices in place, say something. “When you want something to change, be willing to be persistent,’’ she says. “Keep bringing it up and push for things that will make your organization smarter and stronger.”

For more help and resources for your group, check out these articles:

5 Smart Financial Controls

What Every Treasurer Should Know

How to Manage Your Budget

Handling Cash: 6 Simple Steps