Executive board virtually dissolved after parents learn of stolen funds

LITTLETON – The investigation into funds stolen from the South Jeffco Sports Association has led to nearly the entire executive board being dissolved.

At a meeting Tuesday night, parents were told that someone had stolen $100,000 from the organization.

Former President Gary Losh says he was voted out of his position toward the end of the meeting. He says the treasurer is the only one left on the executive board.

"I feel betrayed," said Losh. "(I) feel like I've been thrown under the bus."

Losh says the association is governed by a 25-member board, including a separate executive board.

Those who voted out the executive officers include board members and parents who were at the meeting, which lasted until about 11 p.m.

Losh says he wanted to remain president, "Absolutely I wanted to at least finish this investigation." He adds however, "I am not disgruntled."

Losh says he can understand why this would happen but he believes he and other executive board members should have been congratulated for moving this investigation forward.

"I feel awful for the families," said Losh.

The South Jeffco Sports Association is one of the largest youth sports leagues in the metro area.

Board members are not saying publicly who took the money, but parents were told that person is no longer with the association.

Losh confirms that detail. He says only one person is being investigated in this case, and that person was terminated on September 17. While he would not reveal the person's name or position, he says it was a full time office employee.

"We started looking through other records and discovered a couple more checks that were forged one in my name, the other by the person who is a suspect in this case, writing the check to themselves and signing themselves," said Losh. "(We) just got caught not paying attention. It's the best way I can say it."

When asked why board members did not inform parents about the stolen funds earlier, Losh responded, saying it was early in the investigation and they were still trying to gather accurate information. "You can't provide information that you don't have," he added. He feels parents were notified in a timely manner.

Losh offers this timeline of the investigation:

September 14: Members of the association discovered a forged check for an undisclosed amount. This was around 5:30 p.m. on a Friday. Since it was late in the day and the weekend was starting, Losh and other board members decide to wait until Monday to call the Jefferson County Sheriff's Office.

However that same day, the board terminated the employee whose signature was on the check. That evening the 25 member board was called to an emergency meeting to inform them of what happened.

About a week later: A second forged check was discovered that had already cleared the bank. This was also signed by the same employee that had been terminated. Losh says board members also discovered "other improprieties" involving the terminated employee. As a result, a second emergency board meeting was called that evening.

Since then, Losh says the treasurer has worked four days a week for 10 hours a day to investigate the embezzlement. Losh says he was not paid as president, and even took time off his regular work to help her with the investigation.

Losh says they discovered that $67,000 of the stolen $100,000 was automatically debited from the association's account and transferred to an American Express account. Losh says this embezzlement happened in "clever ways." He says they did talk to American Express, and it is "looking favorable" that the company will refund the entire amount transferred.

"I just felt something wasn't right, just a gut feeling. I was kind of checking here and there, of course not ever thinking that anything could've been electronically debited, not in my wildest dreams, not even thinking about that. The hard part was finding the checks," said Losh.

Losh also says the association has liability insurance, with a clause relating to employee dishonesty, with coverage up to $25,000.

Losh says it is also "looking favorable" that the insurance will pay the full $25,000 to the association. That means there is a chance of a total of $90,000 being returned to the youth sports league.

At Tuesday night's meeting, parents wanted to know how one-sixth of the program's annual budget slipped away. The money came from participation fees paid by parents.

One of those parents was Kristi Sagrillo of Littleton. Her two boys play youth football and baseball in the South Jeffco leagues. To make that happen, she and her husband shell out thousands of dollars every year.

"Never even thought about it, and I think most parents don't think about it," she said. "Where is all that money going? We pay fees, quite a bit of fees, and what are we getting in return?"

Sagrillo says she is angry about the theft, and says it makes her angrier they were not told when it happened.

"You know, I'm really disappointed. I'm very disappointed. If it turns out they've known for quite some time, and that's what I'm hearing, and they didn't disclose it to the members, I'm really disappointed," she said.

Because many athletic leagues are registered as non-profits, there are some questions experts say you should ask before writing that check, according to Charley Shimanski from the Colorado Non-Profit Association.

- Make sure the non-profit is registered with the Colorado Secretary of State's office as required. - Ask if there is an annual audit and if you can see it. - Ask if there is a separation of duties, how many people have to sign the checks? - Ask if any board members have financial expertise. - Get involved.

"There's a great opportunity, unlike a normal business, to get involved in that organization as a volunteer, lend the expertise you have," said Shimanski.

"Perhaps you're a great soccer coach, perhaps you're a CPA and you can bring the financial expertise, perhaps you have computer skills and those types of things. That's one of the most exciting things about the non-profit sector, we engage the public in the great work we do," Shimanski added.

Even so, Shimanski says those questions will not be a full-proof way to keep things from going wrong.

"One can ask all the right questions, get all the right answers and at the end of the day, there still may be wrongdoing taking place within that organization. There is no fail-safe approach," he said.

At the South Jeffco Sports Association's last meeting, the rules were changed so each check over $500 now needs two signatures. Meeting minutes show someone suggested three signatures would be even better.