Recently the Detroit Free Press reported on another church embezzlement case.  In the article it is reported that “after 19 months, members of [the Church] are getting a full-time pastor to formally replace [their former pastor] charged with embezzling $700,000 from the [Church].”

The article details that this church “struggled with attendance and donations in the wake of the allegations against its [former pastor and business administrator].”  Deeper into the report we learn some specifics about the church’s post-embezzlement struggles.  During a recent fund-raising appeal the church fell $100,000 short of its goal of close to $300,000.

One big lesson can be learned from this story.  In the business world, when employee fraud occurs, the problems usually stop with the loss of money.  The perpetrators are charged, restitution is made (hopefully) and in some cases insurance policies cover the loss.  In most cases, everyone dusts themselves off moves on.  Not true in the church world…

In the church environment, the loss of money is often only the beginning of the victim church’s woes.  And in the end, the lost money is the least of the church’s problems.  My main point when attempting to convince a church that a fraud risk assessment is needed is to point out that the pain of lost money pales in comparison with the tsunami of ill will, accusations and loss of trust that can infect a congregation.  As evidenced by this news account, when churches descend into this situation, a much more destructive form of money loss takes place – church members simply quit giving.  Unfortunately, many churches do not even survive…

*Note – When brackets appear [  ] I have changed the names and replaced them with generic descriptions.