Out-of-Control Controller

A not-for-profit organization’s controller had check-signing responsibility as well as access to the organization’s checking account. During his employment, the employee set up a fictitious firm that allegedly provided financial services to the organization. The loss wasn’t discovered until after the employee had left the organization and was caught doing the same thing to his next employer, at which time he admitted that he had established the phantom firm for the sole purpose of stealing from his employer.