A solid set of booster-club guidelines can guard against embezzlement.

When Goodrich (Mich.) High School Athletic Booster Club treasurer Tonya Yannaki suddenly stopped attending meetings last year, her fellow boosters demanded she turn over the club's financial statements. That's when they discovered that Yannaki had transferred $48,000 from club bank accounts into her personal account over a 12-month period. The money helped pay bills and buy a house, according to investigators. Yannaki has since made restitution but still faces up to 10 years in prison.

The Yannaki case followed a similar incident in nearby Livonia, where the former president of the Bentley High School Boosters Club was charged with stealing $17,000. "That's the problem with these clubs - there's no checks and balances," Genesee County Prosecutor David S. Leyton told The Flint Journal. "It's too easy."

Steve Beden, executive director of the North American Booster Club Association, agrees that the very nature of prep-level fundraising leaves assets susceptible. Many booster organizations embrace anyone who volunteers their services and may often overlook the fact that the treasurer has little or no professional background in finance. "Somebody is tagged, pushed into the role of treasurer and given the checkbook," Beden says. "There's no accounting, and there are no oversight committees. Clubs that operate like that can end up getting in trouble."

Booster club embezzlement is a crime of opportunity predicated on trust, says Cynthia McMannon, an assistant executive director of the Arizona Interscholastic Association who specializes in finance and human resources. "While fraud cannot succeed without trust, conducting a successful booster club is also based upon trust," she says. "Booster club members must have a certain degree of autonomy and authority. The question is, how much?"

Beden has spoken with many an athletic director who claims to have experienced strained relations with one or more booster clubs. That friction is often the result of power struggles, when boosters believe they should have control over such administrative duties as the hiring and firing of coaches. As a result, some athletic directors tend to "push the clubs into left field," he says. "They really don't know what else to do with them."

Those clubs then operate with little oversight or support, and members may be more willing to risk breaking the law. It is far easier for someone to rationalize dishonest behavior in that type of atmosphere, McMannon says.

"If somebody wants to steal something, it's going to get stolen," adds Mike Kimmons, assistant principal and athletic administrator at Adamsville (Tenn.) Junior/Senior High School, who is doing his best to make that as difficult as possible. Years ago, the school suffered booster club fraud that resulted in the elimination of all such organizations. Now that the organizations have been reinstated, Kimmons instructs members of the five athletics-related booster clubs to deposit all funds directly into individual team accounts that are monitored by the school's full-time bookkeeper. "I'm not responsible for the booster clubs, but any money they raise is going to go through me or another administrator," he says, stressing that the policy makes theft a lot less tempting.

Adamsville appears to have gotten a jump-start on Tennessee's School Support Organization Financial Accountability Act, which will take effect July 1. Under the new law - passed last June in an effort to eliminate illegal fundraising, fraudulent accounting and misappropriation of booster club funds - every school principal in the state will have ultimate control over all booster clubs and can dissolve them at any time. Additionally, each booster organization must provide officers' names with complete contact details and election dates, as well as draft bylaws and submit annual goals.

Of the estimated 1.3 million booster clubs supporting schools, colleges, universities, municipalities and private organizations, NABCA says that few actually take the time to develop bylaws or objectives. That's why the association provides a sample "code of ethics" to help clubs create their own - including a statement that all members will "hold ourselves accountable to the highest standards for honesty, truthfulness and public service." With language like that, Beden says, club members tempted to pocket funds or manipulate accounts might think twice.

In the wake of the Bentley High embezzlement, a booster organization at a neighboring school decided to require that copies of bank statements be provided to and reviewed by members at meetings, and that one club member not authorized to sign the group's checks audit the checking account on a quarterly basis.

Those are among the defenses that Beden and McMannon suggest, in addition to the following:

  • Find a local accountant (ideally a parent or alum) who will provide pro bono assistance to ensure that proper accounting procedures are followed by the treasurer. Better yet, ask that person to be the treasurer.
  • Invite the athletic director, principal or another school administrator to sit on the club's executive board. This will send a clear message that the club values and respects its relationship with the school.
  • Require that all money collected from game-night concessions and merchandise sales immediately be deposited in a local bank's 24-hour drop box or locked in the school's safe. No booster club member should take money home.
  • Purchase fidelity bond insurance (also known as a commercial crime policy) to protect against losses resulting from stolen money.
  • Upload financial records and files of all booster clubs onto a school computer, ensuring backups.
  • Consider creating an executive booster club to oversee all of a school's booster groups. This organization can serve as a reporting agency, as well as mediator and mentor - helping generate fair opportunities for booster clubs of smaller sports and training all new members in proper policies and procedures.
Booster club officers may be the most common suspects in embezzlement cases, but they aren't always to blame. Last November, a former athletic department secretary at El Toro High School in Lake Forest, Calif., pleaded guilty to stealing an estimated $204,000 from athletic booster clubs over nine years, and was sentenced to a year of house arrest and ordered to pay back the money. And in December, a former employee of Bishop Lynch High School in Dallas who handled cash proceeds from ticket sales at games and other events was indicted on felony theft charges in connection with more than $95,000 missing from the school's booster club coffers. School officials say she wrote checks to herself and forged the athletic director's signature.

"It's sad any time something like that happens, because when the situation hits the papers - and in most cases, it does - you're going to lose support for that organization. And not just that year, but also in the coming years," Beden says. "So even when the people who caused the problems are long gone, the kids will be the ones paying the price."

The Goodrich booster club was lucky. It recouped the stolen money, which doesn't always happen. Goodrich boosters also noticed more Friday night bingo players than usual after charges were filed against Yannaki - an indication that the organization still has the community's support.

The reason residents might be up in arms about booster-club embezzlement is also what may drive them to lend additional support in times of need. "Residents take ownership in a team, and they feel like the money belongs to them," Kimmons says.

Beden claims the majority of booster clubs are slowly becoming more organized and disciplined. That said, the actions of any individual member could still send a club reeling. "These are parents who are good people," he says. "They do not take on their roles with the goal of going out and doing something wrong. But they can get in over their heads."

Aug 2010 Seems I may have the same problem, Can anyone tell me who shuld we turn to... even the princible is turning a blind eye to it Raventek@aol.com
What if alleged misappropiation of funds is done by the Principal and the Athletic Director, and the previous club officers allow it? Who do you go to? We even tried to follow the rules put forth by the District, but the Administrator turn a blind eye....it is not only the officers of the Club that are corrupt.....
We have a situation with our H.S. Soccer organization. We are a pay to play club backed by our school so we can vie for district awards and the kids can receive varsity letters. We have one lady in charge of collecting the player fees which pay for bussing, ref fees and field maintenance. Our boosters pay for uniforms, equipment and everything else. Our boosters have an e-board and we provide a monthly financial statement. The other lady said she doesnt have enough activity to provide us with a monthly statement on the player fee money. I think we should see a statement no matter what. It is the parents money that she is controlling. She is also in charge of the travel and rec soccer leagues which we are afraid that all this money is combined in one account. She claims the h.s. money is separate but we cant get a statement from her. We dont know where to turn to see if we can legally demand that she provide us with a monthly statement. We would also like to see a bank statement so we know that our money is separate from rec and travel accounts. Our A.D. claims she has no control because we are still a club status, although our kids are drug tested and can be disciplined by the A.D. if needed. I called the county prosecutor who said we should call a lawyer, which we do not have the extra funds to do. I'm just trying to find out how we force this lady to give us monthly statements. She also is the only one that signs these checks for the player fee account. Thanks, R.Walker
Agree with the article and hope to see some direction or legal commentary on the inquiries. We also have a school that says it is hands off on Booster Clubs. Yet the Athletic Director was giving out advice and direction on protecting the Coach who was haphazardly giving out "scholarships" to whomever without exec board approval or general membership and donor knowledge. Her own golf booster club she coaches was not appropriately filed with the state. It was rectified recent as in 11/2012 because all the scrutiny on the other booster clubs. She sees and allows the booster clubs for athletics to be run for the benefit of the Coaches not the kids. It is to the point where people are tired and are speaking up but then the school backs down and says they are not involved. In California what legal recourse donors have? Especially when the students welfare gets embroiled and parents asking questions - not directing monies - but asking questions - are ignored, told it is not their business or otherwise harassed by Board members who feel entitled to do so because they are protecting their players playin time but not looking out for the welfare of the funds they are raising.
I am in a similar situation. I am a new head coach at a high school in california. The coach last year left our organization in $6000 of debt. I have organized countless fundraisers and have gotten the debt down to almost nothing. My concern is that the booster club has been helping with the fundraisers and I am kept in the dark as to how much is raised (at and event, for example). I don't like being kept in the dark and the funds are being handed out like hotcakes, and without my approval. I have been tolerating this booster club because I need money for the team's expenses but next year, I want to establish some stricter procedures. I suspect that the money is not being handled properly. Does anyone have any suggestions as to what procedures I can impliment next year? I plan on requiring all the money to go through the Associated Students org. but can anyone suggest what I should do? I hate feeling like I have no control over the money.
Suggestions: Set up a checking acount at a local bank. Have two signatures needed on each check for withdrawals. (caution not husband and wife or relatives)Set up a simple excel spreadsheet to record dates of receipts of deposits and withdrawals. All payments are by check. Present monthly bank statements to the board at regular meetings as part of the financial report. Keep records for each fundraiser, list amount of bank, plus receipts for sales. Each payout must have a receipt and each payout must be paid by check. Insist that at each meeting a detailed financial report is given. On an annual basis a committee from the group should sit down and complete an audit fo the annual books. Questions can be asked and the groups financial position can be established. These suggestionswill not only protect the group but also the individuals who have volunteered to "Keep the books" Good luck
Is the Sponsor/Orginazation leader does not want the booster club help" What to do with the funds?