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UPDATE: Local sport club treasurer pleads to embezzlement

Local youth sports group moves on after embezzlement scam sentencing

Posted: August 31, 2012 10:08 a.m.
Updated: August 31, 2012 10:08 a.m.

 

With the sentencing of its former treasurer, a beleaguered youth sports program is “starting to turn the corner,” following a two-year investigation of an extensive embezzlement scam, parents said Thursday.

Harry Jose, 41, of Canyon Country, was sentenced to a year in jail and ordered to pay $100,000 in restitution, after he pled no contest to one count of grand theft and two counts of forgery Wednesday.

He will also receive one year of probation after he’s released.

Jose used Canyon Country Athletic Association funds as his personal checking account, writing approximately $256,880 in forged checks over a period of four years, according to Detective Steven McCauley of the Los Angeles County Sheriff’s Department Commercial Crimes Bureau.

“He would take CCAA checks and forge (former CCAA President Mike Chandler)’s name and cash the checks, and then put the money in other accounts (Jose) had,” McCauley said.

The Canyon Country Athletic Association is a local Pee Wee football and cheerleading organization with several age groups for children 7-14 years old.

McCauley filed the complaint in March, detailing one count of grand theft and 11 felony counts of forgery. McCauley launched a two-year investigation into the fraud after it was brought to his attention by Mike Harrand, a former board member with the athletic association.

A concern over whether the team would be able to pay for uniforms, despite receiving approximately $400 in dues from hundreds of parents, prompted the first alarm.

Chandler and Jose were asked to resign in August 2009 when suspicions first arose, Harrand said.

The investigation revealed Chandler had no idea his name was being forged on checks, and he had no idea the embezzlement was taking place, McCauley said. He has been cleared of any wrongdoing.

After looking into the books, Harrand knew something was wrong when he assumed treasurer duties and found a tax return had not been filed for the nonprofit in three years.

As Harrand began to dig through years worth of receipts, he noticed suspicious activity. Checks were written to accounts that didn’t have anything to do with Pee Wee football, he said.

About $116,000 of the embezzled funds made it back into program coffers through Jose’s dealings, but once it comes out of an account improperly, it’s considered part of the crime, McCauley said.

The $100,000 amount was a settlement made between Jose and the organization. If he does not pay the full amount within six months, Jose faces several years in prison, McCauley said.

Since the crime was uncovered, the board has resolved more than $70,000 in debts, close to half of that debt to the Internal Revenue Service for the unfiled returns — which was forgiven — and about $40,000 in payments owed to vendors.

Now, after about two years of tightening the belt, the organization is back in the black, according to former athletic association President Brian Adams, who stepped down last year.

In fact, at the end of the season, there was still money in the account after the team bought new helmets for their players, Adams said.

He credited Harrand with helping to bring the case to McCauley’s attention, which ultimately netted the resolution.

“It was a cumbersome process, but I’m glad it’s over,” Harrand said. “Those amounts have been fully paid, and we don’t owe anybody anything at this point. Everything’s great, and we’re starting to turn the corner.”

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