Why Church Leaders Should Take the Risk of Embezzlement Seriously
7 reasons to protect against fraud.

As hard as it may be to believe, churches are not immune from embezzlement. In fact, the widespread belief among church leaders that such a crime "could never happen in a church" makes churches an easy target. Economic downturns make the risk even greater. Here are seven reasons to prevent fraud from happening at your church:

  • Removing temptation. Churches that take steps to prevent embezzlement remove a source of possible temptation for church employees and volunteers who work with money.
  • Protecting reputations. By taking steps to prevent embezzlement, a church protects the reputation of innocent employees and volunteers who otherwise might be suspected of financial wrongdoing when financial irregularities occur.
  • Avoiding confrontations. By taking steps to prevent embezzlement, a church avoids the unpleasant task of confronting individuals who are suspected of embezzlement.
  • Avoiding church division. By taking steps to prevent embezzlement, a church avoids the risk of congregational division that often is associated with cases of embezzlement–with some members wanting to show mercy to the offender and others demanding justice.
  • Avoiding the need to inform donors. By taking steps to prevent embezzlement, a church reduces the risk of having to tell donors that some of their contributions have been misappropriated.
  • Protecting the reputation of church leaders. By taking steps to prevent embezzlement, a church reduces the damage to the reputation and stature of its leaders who otherwise may be blamed for allowing embezzlement to occur.
  • Preserving accountability. Churches that take steps to prevent embezzlement help to create a "culture of accountability" with regard to church funds.

Resource. For a full analysis of the subject of embezzlement of church funds, see chapter 7 (volume 2) in Richard Hammar's four-volume set,Pastor, Church & Law (4th ed. 2009). To order, call 1-800-222-1840 or visit ChurchLawToday.com.

This content is designed to provide accurate and authoritative information in regard to the subject matter covered. It is published with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. "From a Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations

Comments

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Church Fraud Deterrence

February 25, 2011  10:10pm

And yet another obvious reason to put up financial safeguards: Because the money and resources that are placed in a church's care can then go to those that actually need the assistance. Many churches use part of the funds to meet budget necessities, like building and utility payments, before funding their various charities. Some people may think that churches use all the funds for their own luxury (and sadly, a few do) but most churches have non-profits and local charities as a top priority. Therefore when their resources are misappropriated, it affects the whole community, not just the congregation.

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kai

September 09, 2010  5:08pm

Churches are NOT IMMUNE to embezzlement? Pastors are already pocketing the tithe they request every sunday. that is why you see them live in multi million $$$ homes, drive in luxurious homes & fly in private jets.

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