Stealing From Children

Blog
December 3, 2010

In the nonprofit community there is a bad habit of assuming that because everyone is dedicated to the mission, and that the mission is so important, certainly no one would ever do anything to hurt the organization or misappropriate funding. We’d all like to believe that someone we worked with for a long time that seemed to really believe in the program would not actually be embezzling – especially if the mission was to help low-income children. It happens. It is important to realize that it happens. Some people in Austin, Texas have learned that the hard way.

December 1, 2010, Louanne Aponte surrendered to authorities. She is charged with six felonies including theft of over $400,000 from an Austin, Texas charity, Family Connections, where she was the executive director as well as some organizations where she volunteered.  Employees described her as a caring and committed boss.  Family Connections’ mission was helping low-income children. The organization has had to subsequently file for bankruptcy protection as they are no longer eligible to receive any governmental funds and the government is seeking restitution from the individual board members.

The embezzlement is thought to have taken place over a five year period and went to pay for Aponte’s fancy car, ski boat, and house. Staff of the organization are outraged and confused, struggling to understand how someone could do this.

The morality of how someone could do it is difficult to conceptualize. The actual process of how someone could do it was fairly simple. The case “exposed weaknesses in nearly all the checks and balances that were supposed to detect such problems” reports the Austin local news website statesman.com. Aponte falsified financial statements that were presented indicating they had been audited by a local firm. An examiner on a routine check from the state Health and Human Services Commission happen to notice that the firm indicated was not qualified to conduct such an audit. When contacted, the local firm stated that it had not audited Family Connections’ books. Investigators believe that Aponte had been falsifying financial statements for years and forging them to appear audited. Aponte also stands accused of tampering with governmental reports.

No criminal background check was performed prior to hiring which would have revealed that Aponte was still on parole from a 1987 theft conviction.  The board admitted to never having met with the auditors which would have prevented the scheme in the first place. Having a meeting between the board and the auditors is a fairly standard practice in the nonprofit arena. The City of Austin has revised its rules for oversight of funded agencies in the wake of this case. Aponte is sitting in jail today with bail set at $1.5 million.