When is borrowing actually theft?

[Louisa1895]

Hi,

I need some advice please.

I am treasurer for a local kids’ group. I’ve recently discovered the chair has been borrowing money for personal reasons from petty cash. I only discovered this because funds were light and I asked whether some expenses hadn’t made their way to me. Turns out there have been at least 3 occasions this has happened. Money has been repaid but I feel compromised and betrayed (personally and on behalf of the group). It has always been operated on trust.

No acknowledgement, apology, recognition it was wrong. Instead chair is acting as if i’m In the wrong for calling it out. It’s as if he doesn’t see the problem and he’s made comments about the group is very friendly and doesn’t need regimented processes (i’ve Since tightened up all accounting processes). I haven’t gone public on them - just tried to manage it few committee members.

Would you feel the same as me? To me, the initial borrowing, and subsequent attitude, is just so wrong. I can’t believe I misjudged someone so badly.

Really interested to hear others’ views. Thanks in advance

[TheKitchenWitch]

No no no no no. Absolutely no. Yes it is based on trust and that means nobody helps themselves to funds.

[Louisa1895]

Thank you - I completely completely agree. Thank you for the validation. I’m just so shocked by his attitude.

[DontBuyANewMumCashmere]

By law, theft occurs when someone appropriates something belonging to another with the intention of permanently depriving it.

Morally it is theft as he has borrowed and used the money without permission, but unless you can prove he intended to never pay it back it wouldn't be classed as theft.
He hadn't cleared it, nor left a note/IOU... but also didn't deny it when challenged.

Very dodgy behaviour but not theft I don't think.

[dizzydaisies]

Agree it's wrong but I expect they (stupidly!) think they're not doing much wrong.

I think the approach I'd take, is to say that if it ever came to light, if the charity ever came under scrutiny, it could appear very suspicious and would cause lots of scandal and embarrassment for the group. Therefore let's avoid that by being extra squeaky clean and transparent with all incoming/outcoming.

[Time40]

It's not theft because it was repaid, but it's deeply unprofessional. I would feel the same way you do. Tell him it must never happen again.

[FadedRed]

His attitude is because you've called him out on his totally improper actions. You are absolutely in the right to have done this. I hope he isn't still the Chair, because he shouldn't be.

[TokyoSushi]

Yes not quite theft, but definitely not right either. I wouldn't want jim as the chair. What is he borrowing or for? £2 for a coffee or £100 for his weekly food shop? Not right whatever it is though.

[Louisa1895]

Thanks all. I called a mini committee meeting which was minuted. I made it absolutely clear that the group’s money is held in trust, there must not be any personal borrowing ever again.

What I am really shocked about is the behaviour of this person to me now. He’s angry, tried to obstruct me from speaking to others on committee without him there. He is outraged. I have never used the word theft to him - I chose to believe he genuinely borrowed the money. So I did give him benefit of doubt. But his attitude since stinks.he’s treating me as if i’m In the wrong, and sadly it seems getting others on side. I have tried to be reasonable but can’t put up with this for much longer.

[Louisa1895]

£40 as far as I can make out. Trust is destroyed now though. Because he only paid this amount back after I challenged the light funds I wonder whether this has been happening all along. It feels horrible.

Yes, still chair. No one will take over and group will fold otherwise. I think we should close and give the money to charity. We do t have many numbers now and the whole things feels horrible now. Finding it hard to remain objective and divorce the emotio from it all.

[FadedRed]

In your shoes, I wouldn't want any more to do with this dodgy set up. Is it a stand alone group or is there an official authority responsible for this group? Is it or the overarching organisation registered with the Charities Commission? I would be taking any evidence to the official authority or reporting to the CC. And leaving to find a better use for your time and efforts. Hopefully the group would be dissolved and a new startedgroup with all the correct provisions for conduct put in place.
Sounds like he was using the groups money as his own personal slush fund/lending bank. Not on.

[Louisa1895]

The group is affiliated to a children’s organisation but is not a registered charity. It does have charitable aims though. I was concerned about lack of framework about 2 years ago and pushed for the group to adopt a suitable constitution. So we do have rules to follow!

I have suggested we close up but obviously it’s not just up to me. I can’t just resign as that leaves one signatory on the account - him. I need to find somebody responsible and reputable to handover to. Ultimately my concern is the money. It is for the children only. I need to make sure it will be properly managed. But if the group is going to continue I need to leave as the trust has completely gone. This person has no integrity. I’m so upset by this - can’t work out if it’s the original “borrowing” or his attitude after the event. Ie no remorse but very defensive and acting as if i’m In the wrong. How can he have no shame? I just find it so baffling that someone can act so appallingly without shame! I really need to leave and move on with my life 🤦‍♀️

[SDTGisAnEvilWolefGenius]

Could you suggest a third signatory for the account - say it is for everyone’s convenience, if a signatory is unavailable - and resign as soon as one is chosen?

[crosstalk]

Rather than close it, if it's done good work, can you not reinvigorate it as a charity and register it with the charity commission? Or get it subsumed into the children's organisation as subset? I suspect other people than you will have suffered from questioning the chairman or disagreeing with him - or is that not true? no wonder it's floundering. Can you not access financial records to see if it has been going on rather longer than the £40 you spotted?

[Louisa1895]

Like the idea of a third signatory. Unfortunately group can’t be registered charity as revenue less than £5k. It is all a mess. I tried to handle this responsibly with the ultimate aim of ensuring money spent appropriately. I did “out” the chair in a mini committee meeting - I had to as we must be transparent. But I did spare him as I didn’t divulge the exact circumstances. The other committee members have accepted that it was borrowing and won’t happen again, as did I. As there was no hard evidence for theft I simply tightened up accounting processes (esp re petty cash) and explained we need to be clear and transparent. I have suggested we close (lack of interest and support) but he’s determined to keep it open but at the same time demanding three figures in petty cash and saying no need for regimented processes. The secretary also seems to have turned - it seems to have turned into shutting me out because they think i’m shutting Them down (I just want it run properly). Chair has really turned - i’ve Done a couple of financial notes for committee and, at the meeting, the chair has demanded to audit them before circulation despite having never paid any interest before. I can only think he’s worried about being outed further. On a personal note I don’t know what he’s saying about me and I am really concerned that my integrity and reputation is going to be affected by this. I have simply been trying to do the right thing following g his actions. I am really struggling tbh - finding it so hard to talk to someone who refuses to acknowledge they’ve made a mistake, or apologise. The fact that he doesn’t recognise what he did is dodgy, and the position his actions have placed the group and everyone else in, makes me so uncomfortable. I don’t want to sound all self-righteous but it’s wrong and it bothers me that he’s now turned on me. I guess that’s because I called him out on his actions. If anyone has any experience of this or similar please do share. Worried how this is going to end up!

[Hiddentruth]

Hi this is a brief reply but have experience of this. It happened at our village out of school club and it was fraud. The treasurer had been changing chequestion adequate out to the out of school to herself...amongst other things... and banking them. Moor fool the bank who accepted crossed out altered cheques! She was very affable but she was found guilty. ..got a custodial sentence and only got out of that on health grounds as she claimed she was pregnant...or something! !!!

Consult your bank on it proto and anyone who is unreasonably aggressive as you describe has something to hide. Speak to the police. This person sounds like bad news.

Did you watch Panorama on Monday I think...called Ripped Off...Join the Club?

Not quite the same crime but it shows the vulnerability of clubs to unscrupulous imposters.

Your case may not be so bad as ours but you are wise to be wise.

Consult the experts and bypass this chair. Minimising a crime is a well known tactic.

[Hiddentruth]

Sorry for typos using a tiny screen here...fat fingers!

I mean altered cheques making them out to herself....

[Floralgizelle]

You gave him the benefit of the doubt and didnt acuse him of anything, only pointed out it makes you feel uncomfortable him borrowing for personal issues when you as treasurer could be acused when monies are not accounted for. The fact he is now acting in an agressive manner, shows he is more than likely upset at being found out. We had a similar set up within the family and they immediately got aggressive and tried to point fingers. Now that you have ensured the comittee is aware of no personal borrowing without 'throwing him under the bus' (which is more than he deserves) but great job at handling this situation profesionally. All he is doing is making himself look guilty and im sure others see it this way too.