Gonzaga program helps police crack smaller-scale fraud, embezzlement cases

Spokane County law enforcement agencies believe they may be seeing the criminal result of the bad economy: Reports of theft and fraud by employees in all types of work are increasing.

From fast-food restaurants to mom-and-pop businesses to large corporations, police say they’ve seen more reports of theft in the workplace in the past two years than ever before.

Investigators have long had their hands full with cases, so an increase in theft reports doesn’t necessarily lead to an increase in theft investigations.

“We’re already working as many cases as we can work. We know it’s there, but our caseload can’t really go up any more,” said Spokane police Detective Stacy Carr.

The Spokane Police Department also recently reassigned a detective to the property crime unit from the fraud unit.

But a program at Gonzaga University that began two years ago is helping. The Justice for Fraud Victims Project is a partnership of academia, law enforcement and criminal prosecutors that allows students to get real-life experience while assisting theft victims who may otherwise never see justice.

Prosecuting long-term theft can require detailed forensic audits that police aren’t trained to do and small businesses just can’t afford. The Gonzaga class, with the help of certified fraud examiners, conducts the audits for free. Professional accountants and forensic auditors volunteer to assist the students.

“It’s an area of expertise police have not traditionally been trained in,” said K. Jill Bolton, an assistant U.S. attorney who tracks white-collar crime in Eastern Washington.

And officials say it’s working. Embezzlers have been prosecuted who authorities acknowledge may have slipped through the cracks had the class not been available.

Carr points to a large-scale theft by an employee from the Hillyard chapter of the Knights of Columbus. She had nearly completed her investigation into the theft when the Spokane North Lions Club reported a similar theft. Carr quickly realized the suspect was the same man: Curtis G. Wasson. Carr already had a felony case pending against Wasson and questioned whether she could justify the time it would take to investigate the Lions case. That’s where the class came in.

Students investigated the North Lions Club theft, and Wasson pleaded guilty in both cases last June and was ordered to pay back all the stolen money – nearly $24,000.

Were it not for the class, the North Lions Club may never have seen justice, Carr said.

Marie Rice, program coordinator and a certified fraud accountant, said the need for the program was obvious.

“We saw there was ample opportunity to help,” she said.

Spokane Valley police Sgt. John Nowels, who leads the property crime unit, said the program is “absolutely” making a difference, “particularly for smaller businesses that may not have the money to pay for a forensic audit.”

“Especially with cases when there’s been long-term theft and long-term fraud, those guys really come in handy,” he said.

Nowels said he’s noticed a surge in smaller-scale employee thefts over the past couple of years.

“We would always see the large-scale frauds,” Nowels said. “Now we’re starting to see more, ‘Oh, hey, I have this employee and I caught him stealing $800 to $2,000.’ ”

Fraud and forgery reports in Spokane and Spokane County increased 34 percent from 2009 to 2011. That’s after a two-year decrease from 2,378 in 2007 to 2,057 in 2009. The 2,765 fraud and forgery reports in 2011 aren’t all employee theft, of course, but crime analysts just started recording those specific thefts this year.

But the police who investigate those reports daily say the increase in employee theft became apparent in the past two years.

“Are people more desperate because of the economy? I don’t know,” Nowels said. “We’re getting more reporting because the businesses just don’t want to absorb those losses anymore. But I don’t think it’s just a reporting issue.”