Georgia Professional Standards Commission 2014 West Georgia RESA Fraud Prevention, Booster Clubs and Other Items

Sanctions-January, 2013 January 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 2

Sanctions  Abandonment of Contract-6  Required Reports-34  Professional Conduct-39  Testing-71  Total-459 3

West Georgia RESA 4

West Georgia RESA         

FY 2011

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         

FY 2012

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

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 6

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

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 12

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 14

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 2 nd teacher reported to principal the rumor she had heard and got the same response  Investigate and report rumors to superintendent 15

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:

1.

misusing public or school-related funds; 2.

3.

4.

5.

failing to account for funds collected from students or parents; submitting fraudulent requests or documentation for reimbursement of expenses or for pay; co-mingling public or school-related funds with personal funds or checking accounts; and using school property without the approval of the local board of education/governing board or authorized designee .

 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 19

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 20

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? 21

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 23

Bob  Also the perpetrator of a million dollar fraud scheme  Bob was caught purely by accident  Does your school district employ any Bobs 24

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 25

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 26

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 27

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 28

What can be done  Hotline  Employee training  Establishing a culture  Internal controls  Better hiring practices  Understand why fraud occurs 29

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 30

Top Internal Controls  Keep current inventory of assets  Protect petty cash funds  Insist on receipts, invoices 31

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 32

Invoices  P. O. Box with no phone number or fax  No folded invoice  No shipping and handling, no taxes  Sequentially numbered invoices  Photoshop invoices 33

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 34

Booster Clubs and Student Organizations

35

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 36

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 37

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 38

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 39

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 40

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? 41

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 43

Joe Paterno 44

Where Do We Go From Here?

45

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 46

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 47

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 48

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 49

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 50

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 51

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.)

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 54

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

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 56

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?

57

Special Thanks  Georgia High School Athletic Association  Cartersville City School System  John Grant 58

Contact Information  [email protected]

 404-232-2635 59