Statement from Richard Spies

September 19, 2016 11:16 am

Statement from Richard Spies

 

 

Dear Friends –

 

As you know, The Providence Plan has been working diligently to address the fallout from the recent embezzlement that we suffered at the hands of a now terminated employee.    I am reaching out today to keep you, our friends and supporters, up-to-date and informed.

 

Here are the facts:

 

  • In July 2016, we were made aware of significant gambling losses by our then Director of Finance. As a result, with the assistance of our auditors and bank, we conducted additional reviews and identified a number of questionable expenditures from TPP’s account.
  • In conjunction with our bank we compiled the checks behind those expenditures, and confirmed that they were unauthorized and improper.
  • We then sought and obtained the assistance of Brown Rudnick LLP, including an experienced team from their New York City office to investigate the apparent criminal conduct which had been uncovered. Brown Rudnick LLP agreed to assist TPP through this crisis on a pro bono basis.
  • The team from New York includes Justin Weddle, who was an Assistant United States Attorney in the Southern District of New York investigating and prosecuting white collar crime for more than 12 years.
  • The Brown Rudnick lawyers swiftly confirmed that the identified checks were forged, that they were forged by the same individual employee at TPP, and that the employee was also in a position to cover his tracks through various accounting entries.
  • On July 27, as soon as these facts were confirmed, TPP terminated the responsible employee.
  • TPP’s extraordinarily committed board of directors became immediately involved, creating a special committee of the board to manage the process. The board directed the special committee to do so with the following guiding principles:  we should cooperate with law enforcement fully, we should be transparent with stakeholders, and we should do everything possible to maintain TPP’s ability to continue to fulfill its mission of helping the community through its various programs.
  • To those ends, TPP quickly contacted funders and other stakeholders, continued its full cooperation with law enforcement, and issued a public statement on July 29, 2016.
  • The direct theft is in the range of hundreds of thousands of dollars, as TPP announced on July 29 and was reported in several local media outlets the next day.
  • TPP also moved quickly to engage forensic auditors to trace the accounting entries related to the stolen funds and to determine the effect, if any, on individual grants.
  • The work by the forensic auditors has continued, as has TPP’s continuing response to the theft it has suffered.
  • Throughout the process, TPP’s board has remained engaged and committed to finding a path through this crisis.  At the same time, TPP has responded to inquiries from every media outlet that has posed them, sharing information as it has become available. Going forward, we will continue to be open, accessible and transparent as we continue our work serving Providence, and all of Rhode Island.

 

This is a challenging time for us at The Providence Plan, but we are committed to moving forward in a straightforward, transparent manner.  I want to thank you again for your support and please don’t hesitate to reach out to me if you have anything that you would like to share with me or the team.  I will continue to keep you informed of events as they develop.

 

Best wishes,

 

Richard Spies

Chair