Nathan Salsbery is a partner and executive vice president with the accounting firm CapinCrouse. As the son of a pastor and the son-in-law of a retired FBI agent, it's perhaps no surprise that he's become an expert in forensic accounting and rooting out fraud in churches. We asked him to talk about his forensic accounting work and offer insights for identifying and preventing fraud in churches.
What's the difference between fraud and embezzlement?
Fraud is a very broad term. Embezzlement is just one method of fraud. In broad categories, fraud is committed through asset misappropriation, fraudulent reporting, or corruption. Embezzlement sits within asset misappropriation, so it's kind of a subclass of fraud.
Is asset misappropriation the most common type of fraud?
Yes, in general terms, asset misappropriation is stealing, and that is the most common type of fraud. It could be stealing the cash of a church, whether through cash going out of the church, such as checks or expense reimbursements, or through cash coming in to the church, such as offerings or registration fees paid by a member for a church event.