A church administrator in southwestern Pennsylvania allegedly skimmed more than $1.2 million in funds from his employer over the past seven years, in part by creating fake auditor reports to hoodwink the church’s board of trustees. That kind of fraud could have been prevented if the church or its financial institutions used RIVIO Clearinghouse, a secure online exchange for private company financial information, jointly developed by CPA.com and Confirmation.
David Reiter, 50, had been employed by Westminster Presbyterian Church in Upper St. Clair, Pa., for 17 years, a job that paid $69,000 in 2018. Yet the Allegheny County (Pa.) District Attorney's office calculates that Reiter and his wife, Connie, managed to steal $1,227,423 from church accounts – including the organization’s nursery school and child care programs – from 2011 to late 2018. Those spoils allegedly paid for trips to Walt Disney World and Hershey Park, Pittsburgh Pirates tickets, music lessons for the Reiters’ children, medical expenses, and a host of other items ranging from Starbucks visits to Sirius XM radio fees, the district attorney’s office contends.
The alleged scheme unraveled when the church board’s treasurer grew impatient with David Reiter when a face-to-face meeting kept being delayed with the church auditor, identified by Reiter as “Drew Harrison” of the Pittsburgh accounting firm Sisterson & Co. The treasurer called the firm and was told no one by that name worked there.
Reiter instead offered a cell phone number to contact the auditor, according to the district attorney’s office. But it was for a prepaid phone paid out of the skimmed funds, and Reiter impersonated “Harrison” on a subsequent call with the treasurer. With questions mounting, Reiter confessed to the church’s head pastor that he had done “bad things” and needed to resign.
Investigators later discovered the church had never been a client of Sisterson, and that Reiter had fabricated an audit report from the firm, as well as an earlier audit report from another firm that hadn’t been involved with the church for years.
In this case, a fake audit report was created, appearing to be issued by a real, licensed CPA firm, however the church had never been a client of this firm. Let’s explore how this could have been prevented with RIVIO Clearinghouse:
- Audit reports exchanged through the platform can only be issued from licensed CPA firms that are appropriately following the stringent professional requirements to upload attested financial information.
- Documents submitted through the platform cannot be altered, ensuring that information is authentic.
- If RIVIO had been in use by the church or its financial institutions, the administrator wouldn’t have been able to pass off bogus auditor reports as legitimate.
Unfortunately, it can be too easy for bad actors to manipulate information. The good news is that there are steps you can take to help protect your clients and your firm.
You can read more about this case here - https://www.thisisinsider.com/david-reiter-allegedly-stole-money-from-westminster-presbyterian-church-2019-2
Learn about another fraud case very similar to this one, involving the former owner of Newsweek. https://www.cpa.com/webinars/scheme-defraud-first-degree-investigating-newsweek-financial-fraud
Kalil is the leader of CPA.com's sales organization, and is responsible for developing and executing go-to-market sales strategy across the organization’s product and services business lines to the CPA profession and adjacent professional markets. Under his leadership, CPA.com's sales capacity has expanded to drive deep engagement with the Big 4, Top 100 CPA firms, and small and midsize firms spanning client accounting services, sales and use tax, audit and assurance, and advisory practice areas.
After earning a bachelor’s degree in food industry management from Michigan State University, Kalil worked as an account representative with Thomson Reuters Tax & Accounting.
Kalil joined the CPA.com team in 2011 as a strategic account manager. After consistently outperforming goals and having demonstrated exemplary leadership and vision, he transitioned into Enterprise Business Development. His extensive knowledge of technology, leadership, and strategic management trends in the accounting profession has kept him in high demand for speaking engagements, allowing him to share vital insight and information to accounting professionals. He also led the launch of CPA.com's RIVIO Clearinghouse.
In 2017, Kalil was recognized by CPA Practice Advisor as a Top 20 under 40 Superstar for his influence and contributions to change in the accounting profession.