Georgia Professional Standards Commission
2014 West Georgia RESA
Fraud Prevention, Booster
Clubs and Other Items
Sanctions-January, 2013January 2014
Legal compliance-35
 Conduct with Students-84
 Alcohol and Drugs-34
 Honesty-119
 Public Funds and Property-30
 Remunerative Conduct-2
 Confidential Information-5
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2
Sanctions
Abandonment of Contract-6
 Required Reports-34
 Professional Conduct-39
 Testing-71
 Total-459
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West Georgia RESA
4
West Georgia RESA
FY 2012
FY 2011
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Carroll County-6
Carrollton City-0
Coweta County-5
Harris County-3
Heard County-0
Meriwether County-9
Troup County-8
Total-31
RESAs avg-61
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Carroll County-3
Carrollton City-6
Coweta County-10
Harris County-2
Heard County-2
Meriwether County-2
Troup County-5
Total-30
RESAs avg-64
FY-2013
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Carroll County-1
Carrollton City-0
Coweta County-7
Harris County-4
Heard County-0
Meriwether County-0
Troup County-1
Total-13
RESAs avg-55
Violations From Cases Closed
July 1, 2010-June 30, 2012
Top certification areas:
 CTAE
 P. E.
 Social Studies
 Special Education
 Years of Experience:
 6-10 years—approximate age-28-30
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Standard 2
Conduct With Students
Standard 2
An educator shall always
maintain a
professional
relationship with all
students, both in and
outside the classroom.
For the purposes of
the Code of Ethics,
the enrollment period
for a graduating
student ends on
August 31 of the year
of graduation.
Sexual Abuse of
Students
Statistics
1 in 84 chance of being killed in
automobile during lifetime
 Risk of being sexually abused by age 18
 For Girls-1 in 4
 For Boys-1 in 6
 Median age-9 years old
 90% of perpetrators known by family
 40% inside the home
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Sexual Relationship with
Students
O. C.G. A.--16-6-5.1
 Person who has supervisory or disciplinary
authority over a student who engages in
sexual contact with students…
 New thing in Georgia
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Sexual Relationship with
Student
13
16-6-5.1
Jail time
 Age 16-not less than one year nor more
than 25 years in jail or a fine not to
exceed $100,000 or both
 Under the age of 16-not less than 25
years nor more than 50 years in jail
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Principal
Teacher heard a rumor regarding an
inappropriate relationship between a
teacher and a student
 Principal stated—”Do you have any
evidence?”
 Several weeks later, a 2nd teacher
reported to principal the rumor she had
heard and got the same response
 Investigate and report rumors to
superintendent
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Standard 5
Public Funds
& Property
Standard 5
An educator entrusted with
public funds and property
shall honor that trust with a
high level of honesty,
accuracy, and responsibility.
Public Funds & Property
Unethical conduct includes but is not limited to:
misusing public or school-related funds;
2. failing to account for funds collected from
students or parents;
3. submitting fraudulent requests or
documentation for reimbursement of expenses
or for pay;
4. co-mingling public or school-related funds with
personal funds or checking accounts; and
5. using school property without the approval of
the local board of education/governing board or
authorized designee.
1.
Standard 5-Public Funds and
Property
Fraud-any intentional or deliberate act to
deprive another of property or money by
guile, deception, or other unfair means
 5% of revenue will be lost annually to
occupational fraud
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10-10-80 Rule
10% will never steal from you
 10% will rob you at every opportunity
 80% will steal if given the right
opportunity and circumstances
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The Silent Code
Code of the Schoolyard
 Don’t tattle
 Never say anything unless you are sure
everyone feels that way
 Don’t get involved
 What is the difference between tattling
and reporting?
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Meet Bob
Bob
Not his real picture; had to use a French
model
 Bob is a state employee
 Bob has been with the state of Georgia for
20 years
 Bob is a well respected family man
 Bob is a hard worker-he arrives early and
stays late
 Bob is dedicated-he has a heavy work load
and never takes vacation
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Bob
Also the perpetrator of a million dollar
fraud scheme
 Bob was caught purely by accident
 Does your school district employ any
Bobs
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How could this have happened?
Management ignored red flags
 Lack of management oversight
 Placed trust in Bob to the exclusion of
internal controls
 Allowed high workloads to override basic
accounting practices
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Why don’t more people report?
No mechanism for reporting
 Failure to train management to recognize
fraud
 Failure to train employees
 Fear of retaliation
 Fear of lawsuit
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Schools are especially
vulnerable
Educators are basically trusting and
compliant
 Schools have a high workload
 Many employees have the opportunity to
commit fraud
 Educators are not trained to audit and
inspect financial transactions
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Reasons Employees Commit
Fraud
Opportunity
 Financial pressures-living beyond one’s
means, alcohol, drugs, gambling, poor
credit, unexpected financial needs
 Rationalization-I’m only borrowing the
money, I deserve more pay, they won’t
miss it, I won’t get caught, I’m not hurting
anyone, it’s not that serious, it’s for a
good cause
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What can be done
Hotline
 Employee training
 Establishing a culture
 Internal controls
 Better hiring practices
 Understand why fraud occurs
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Top Internal Controls
A system of checks and balances
 Reconcile revenues and expenditures
every month
 Restrict use of credit cards and verify all
charges and accounts
 Provide oversight of operations and
management
 Put policies and procedures in writing
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Top Internal Controls
Keep current inventory of assets
 Protect petty cash funds
 Insist on receipts, invoices
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Schemes
Expense reimbursement
 Payroll
 Billing Schemes-Shell companies, false
invoices, overpayment
 Vendors-nepotism, outside employment
with company, projects before renovations
 Bribery, Kickbacks, Bid-rigging
 Specifications written for a specific
business
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Invoices
P. O. Box with no phone number or fax
 No folded invoice
 No shipping and handling, no taxes
 Sequentially numbered invoices
 Photoshop invoices
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Do Schools Have a Problem?
Former state superintendent
 Former DeKalb superintendent
 Former assistant superintendent in Walton
County
 Booster Club and PTA officers-(Cherokee,
Gwinnett, Walton)
 Assistant Principal and A. D. (Fayette)
 Coaches, Bookkeepers, Cafeteria
Managers, Administrators, Bus Mechanics
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Booster Clubs and
Student Organizations
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Position of Principals
Booster Clubs have their own rules and
regulations
 Booster Clubs do not fall under
supervision of School
 Principals have no control or authority
over Booster Clubs
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Question
If the high school does not exist, would
there be a need for a Booster Club?
 What if Booster Club wanted to do
something controversial
 Professional Standards Commission holds
school system administration accountable
for Booster Clubs
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GHSA By-law 1.73
A Booster Club shall be considered to be
an extension of the school
 Following persons or groups may be
considered boosters:
 Members or Parents
 Donors
 Volunteers
 Alumni or Former Students
 Relatives
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Standard #5 Public Funds and
Property
An Educator entrusted with public funds
and property shall honor that trust with a
high level of honesty, accuracy, and
responsibility
 Unethical conduct includes but is not
limited to:
 Using school property for personal gain
 Using school property without the
approval of the local BOE/ designee
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Is it Legal?
Coaches utilize Booster Club funds or
School funds to purchase team logo shirts
for Coaches and Administrators
 Do other employees get free clothes to
wear to work?
 Do we allow Band Directors to purchase
their outfits for free?....or Drama teacher?
 If other teachers received anything free,
they would be scrutinized
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Camps
Who handles the money?
 Who gets paid?
 How is the revenue used?
 Are school equipment, supplies, facilities,
etc. used?
 Are the Drama teacher and other
employees provided the same
opportunities as coaches?
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Standard 9
Required
Reports
Soccer Coach
A player asked her coach if she could talk
with her confidentially
 Coach agreed to keep things confidential
 Student said she was being sexually
abused at home
 Coach suggested they go to the counselor
 Student refused-saying she needed to
keep things confidential
 After several weeks of coercion, the coach
and player went to the school counselor
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Joe Paterno
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Where Do We Go From
Here?
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Solutions
Good Board Policies
 Supervision of Booster Clubs and Student
Organizations
 Proper Accounting Procedures
 Training provided on an annual basis
 Accurate and Up-to-Date records
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Suggested Board Policy
All clubs and organizations (including PTAs
and Booster clubs) are required to use
school as fiscal agent
 Must follow all internal accounting
procedures
 Audit Trail-clear trail from receipt of funds
to disbursement of funds
 Bank Account-Principal controls—as
option-could require two signatures
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Suggested Board Policy
Principal should establish a general fund
or account for all organizations and
projects such as pictures sales or vending
income
 No debt incurred which cannot be paid
from receipts of the approved activity
 No debt can be carried over to next fiscal
year without specific board approval
 All purchases must be made in accordance
with board purchasing policies
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Up-to-Date Records for Student
Organizations and Booster Clubs
Files should contain current membership
list with names, addresses, phone
numbers of officers
 Files should contain list of By-laws
 Goals should be submitted each year
 All planned fund raisers should be
submitted for board/designee approval
 All trademarks, logos, and marketing
information are property of the BOE
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Up-to Date Records (continued)
Minutes should be taken at each meeting
and submitted to principal or designee
 Attendance records should be recorded
and included in the minutes
 Guidelines should be established on the
procedures necessary to begin a new
organization—minimum number of
members, by-laws, name of sponsor,
meeting dates, purpose, proposed
activities, when clubs can be formed, etc
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Community Coaches and Band
Helpers
Booster Clubs may hire using contracted
services
 Approval of Athletic Director, Principal,
and Superintendent required prior to
issuance of contract/MOU
 Volunteers and Community Coaches
should undergo FBI background check and
fingerprinting
 Title IX guidelines apply
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THE BUCK STOPS WITH YOUR
ATTORNEY
Another Available Option
Establish Booster Club as 501c3 non-profit
organization
 Must have its own tax ID number
 Registered and approved with IRS
 Have same requirements for all Boosters
(Band, Athletic, Academic, Foundations,
etc.)
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Requirements
Principal or Administrative Designee
should be a member of the Executive
Committee and attend all meetings
 Coaches/Band Directors should not serve
on Executive Board
 Check writing should require two
signatures
 Audit and Tax returns should be required
annually with copy sent to Superintendent
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Treatment of Perks and Benefits to
Educators
Booster Club is responsible for all record
keeping and tax notification
 Form 990 should be filed with IRS if gross
receipts are greater than $25,000.
 Form 1099 for income
 Educator responsible for reporting income
on tax return
 Camp Income also applies
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Advice
Coaches should not maintain checking
account for any fund raisers or activities
 Strong board policies protect the coaches
and the school system
 Utilize proper accounting procedures and
maintain accurate records
 Provide training on an annual basis to
administrators, coaches, and booster club/
PTA officers
 Seek advice from board attorney
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What Will the Headlines Read?
Booster Club money stolen-School System
took advice of Attorney
 Trophy High School Booster Club Money
Stolen
 Who will the reporter call?
 The superintendent/high school principal?
 Attorney?
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Special Thanks
Georgia High School Athletic Association
 Cartersville City School System
 John Grant
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Contact Information
paul.shaw@gapsc.com
 404-232-2635
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