Petty theft is not the major risk

[wandrson]

Continuing the discussion from Prosecution of the DMS thief:

On another topic

In many ways what Chris says is true of those who commit white collar crime, too. Embezzlement, kickbacks, graft, brother-in-law deals and other theft occurs routinely in organizations where trust is a fundamental value. I’ve seen it occur in the military, in church and in a number of non-profits. All of these organizations place a very high value on trust.

The best solution is vigilance, audits and accountability policies.

This deserves more then the one like I can give it. Petty thieves, such as the one recently caught, represent far less risk to DMS then the organizational issues that Dan is talking about. I was reminded on reading this post of someone at the last member meeting saying something like; “We elected them, and at some point we just need to trust them.” Dan’s examples (and there are unlimited number of additional examples) illustrate that if you set up a system based upon trust you will eventually have people who violate that trust and steal from you. In my experience many of these violations start with the best of intentions; “Well we need someone to do X, I am very busy and I know so and so who does that.” This type of thing isn’t a problem if it is disclosed, but if it isn’t disclosed or if there is some form of consideration for selecting this person then you have issues.

In my opinion, we, the members, need to spend some time creating procedures that do not require trust and ensure that such practices can not go on.

[John_Marlow]

Walter is SPOT ON!! In every enterprise there must be a separation of powers. People who can authorize expenditures must not be the people who can approve the payments. People who select vendors must not be allowed to approve payments. Purchases of certain types and above certain dollars require multiple quotes. And so on.

[mblatz]

In every enterprise there must be a separation of powers.

To this point, and for the record, I am VERY against board members also serving as committee chairpersons. Committee chairs often have to go/apply TO THE BOARD for funds to further their committee’s goals and agendas. How can this possibly make sense?

[MathewBusby]

If a single chairperson recused themselves, it isn’t much of an issue. It would certainly become an issue if, say, more than one were chairpersons and trading votes.

[ESmith]

I do not intend to request additional funding for Logistics nor will I lobby for, discuss with the board, nor vote on any funding matters pertaining to Logistics funding should they come up. None of the committee regulars volunteered to run the committee nor have any of the tentative volunteers committed to much, so I awkwardly remain with both titles.

[mblatz]

If a single chairperson recused themselves, it isn’t much of an issue. It would certainly become an issue if, say, more than one were chairpersons and trading votes.

It’s an issue no matter what, really. In your scenario for there to be two to trade votes, there first has to be one; why allow it? Also, once a first is allowed, what does the rule to disallow the second one look like…“No Homers”? And if a (one) board member recuses themselves, than a vote is potentially a 2-2 tie (although I am not sure what that means under DMS rules).

It’s just not a good idea.

I do not intend to…etc.

Eric, I understand. Checks and balances aren’t about any one person or group. They are about the eventual person or group that always seems to want to rig the system.

But I appreciate the fact you are not entirely comfortable with your dual roles.

[MathewBusby]

Sorry - that was a poorly phrased supporting argument for your point, which you just illustrated for everyone else.

[mblatz]

And the fact you used an adorable emoticon makes it OK you offered no reasoning or support for you rebuttal.

I am also super-impressed with how you are able to speak for or intuit the mental state of “everyone”.

[Photomancer]

Personally, now that Director funds aren’t available I see a greatly diminished conflict of interest or lessened potential for abuse. Note: I don’t believe there was any in the past but I don’t think it was a good governance practice. All allocations must now come thru the BoD in an openly available recorded vote. This means if there is spending outside of the regular meetings (e.g. an emergency or some deal they deem super) they must make that record available - it’s a financial record which is dictated as open.

Committee Chairs can spend what is in their budget without BoD approval now. But all these purchases must clear the Finance Committee for payment. If something looks “Out of Place” or “Not Right” - then we don’t pay and forward the issue to the BoD for formal payment resolution. You will see at the last BoD meeting that there were some questions regarding Honorariums that were put forth and voted on.

Additionally, since our books are now very current and anyone that wants READ access gets it or you can review a spreadsheet that will be posted on the wiki every week (I believe on Mondays, since Finance meets every Sunday to close out that weeks transactions) so you can sort through them yourselves (which is easier than doing through QuickBooks Online unless you know it. This is the biggest check on abuse. If someone has a question send it to Finance for Review.

As Erik has stated, he is a Chair because no one wanted the thankless job. Finance has an acting Chair, Luke Olson, a BoD member because no one wants to assume the Treasurer role - the hunt goes on. An internal practice of the Finance Committee is you cannot process any of your own transactions. E.g. I could not process reimbursements for items I purchased for CA when I was Co-chair, nor does Allen process his purchases made for others since he is a Procurement Officer. Others on FC do those transactions. (If you’d like to join the FC to help - please do. End of recruitment ad)

We are making major progress on our internal controls - many things are being improved that will also improve things like the new Calendar/Honorarium system to be rolled out.

Again, this is just my personal opinion, from a financial control perspective I don’t see a conflict because everything is so open now. BoD members have been recusing themselves on any items they have involvement with at BoD votes.

Also, when something is a tie vote, the motion fails for lack of a majority to pass.

Long answer - but hope this helps clarify some things that may not be apparent.

[John_Marlow]

There are some good controls in the processes you described. Thanks for clarifying those.

[wandrson]

BoD members have been recusing themselves on any items they have involvement with at BoD votes.

I did some checking today and there have been as many abstains in the first five months of this year as the preceeding fifteen months.

[dryad2b]

Once Scarborough Faire is over (this weekend), I intend take a bigger role, as I mentioned to you earlier. Your current meetings have conflicted with my job.