[myzmak]

Originally Posted by RickFLM4

Well, if you are a small business, I understand it is difficult to put controls in place that segregate duties. However, if you have one person who has control over disbursing cash, reconciling accounts and providing financial statements, checking that persons W-2 vs. what he should be paid or reviewing disbursements periodically is neither time consuming nor stifling and would have easily caught this fraud much sooner. Trust, but verify.

I am a CPA and don't have many small business clients, but the one's I do have insist on signing checks or otherwise approving disbursements themselves if their organization can't support segregation of duties. They watch cash flow details like hawks. Having your personal income dry up as a business owner and figuring it out by looking at QuickBooks after 5 years is inconceivable to me.

Yup, in small businesses they often come about because they don't do what you are suggesting.

All trust placed in one person's hands without a lot of supervision.

Big numbers come when that small business grows rapidly without an accompanying growth in controls. In a 2 person company, having one guy do the finances might make sense. When you grown in a few years to 20-40 or 100 employees, it makes less sense....but people do it.

But it isn't that uncommon. Take 2 sample partners: 1 is good with hands/running a shop, but little education and not terribly sophisticated. Partner is some sort of CPA or educated professional. There will be tremendous trust in that relationship....happens all the time.

Originally Posted by F32Fleet

Typical fraud that always gets discovered when the fraudster goes on vacation.

Also true.

[3GFX]

Originally Posted by deemo319

I read this a few hours ago. It's depressing to say the least.

Agreed, majority of the read was quite depressing.

Originally Posted by obert

To long of a read

+1...didn't a speed read of the whole thing

Originally Posted by Rocko123

Damn dude... whyd he have to go and steal so much money for car parts lol

Right? From the sounds of it, the job and pay wasn't that bad to begin with. Selfish bastard.

Originally Posted by sdshah

Loser

Yes, good summary.

Originally Posted by 6ixSpd

This person definitely had a mental disorder that spiralled his pathological lying and desire to steal money to fuel his addiction. Too bad he wasn't diagnosed earlier in life, surely there must've been multiple obsessive habits before cars....

Unfortunate that it's down to mental health.

[///M3THOD]

I collect packs of Chick-Fil-A salad toppings and hide them in my desk at work when my company pays for my lunch, my boss knows about it and doesn't seem to mind.

I still haven't told my GF.... probably never will.

[fbsm]

Sad story of mental illness

[Maynard]

Lots of fun stuff in this, but I'm calling BS on the whole thing - mainly b/c there is no mention of any repossession of all those parts and cars (not to mention that we are supposed to believe that this small father-son business could suck down a half million in hidden losses w/o it being obvious). Like another poster noted, 50 2002's would be worth a bit of cash, even if they were parts cars. Then there are apparently many different rooms/buildings full of parts from internet vendors, etc. I know they will often let you retain a car and home, but can't believe the judge would not garnish these assets for reimbursement.

Or am I just in massive denial....I mean, who hasn't made a firm 'never go in the basement' rule with their family - nothing weird about that, is there? Its my 'man cave'.

[danniexi]

Originally Posted by ///M3THOD

I collect packs of Chick-Fil-A salad toppings and hide them in my desk at work when my company pays for my lunch, my boss knows about it and doesn't seem to mind.

I still haven't told my GF.... probably never will.

yeah.. unless you are spending hundreds of thousands of dollars of company money on said salad dressing.... not the same thing.

[griz31]

Given the length and elaborate details of this story, I was hoping for a classic "rick roll"

It did make me laugh that the guy still drives a BMW, but really depressing if actually true.

[RABAUKE]

Originally Posted by BoostedN54

Is that considered cheating

What ever it is, it's cheaper than a 20 year old girlfriend.....that's how I justify my Z4MC to my wife anyway.

[3GFX]

Originally Posted by RABAUKE

What ever it is, it's cheaper than a 20 year old girlfriend.....that's how I justify my Z4MC to my wife anyway.

Still a risky move right there.

[NickyC]

What a bizarre story.

[acoustix]

maybe there should be a rehabilitation centre for BMW enthusiasts

all jokes aside its an extremely sad story, hopefully we don't hear more of this kind of stuff happening.

[ReeferCheefer]

good to know how to get out of the psych ward.

3 paragraphs on how nice the guy is but not one sentence on what happened to the fkn BMW's!!

[InspireSiR]

Addiction and OCD is a serious mental disorder. It's clearly ruined his life.

I'm glad to hear he was able to rehabilitate himself.

[pz619]

Originally Posted by ReeferCheefer

good to know how to get out of the psych ward.

Not to start a whole editorial on the topic, but this was definitely the most interesting part of the article for me. Cancel insurance, get kicked to the curb.

[Frosty]

Originally Posted by pz619

Not to start a whole editorial on the topic, but this was definitely the most interesting part of the article for me. Cancel insurance, get kicked to the curb.

THIS ... completely agree

[hlothery]

Originally Posted by Maynard

Lots of fun stuff in this, but I'm calling BS on the whole thing - mainly b/c there is no mention of any repossession of all those parts and cars (not to mention that we are supposed to believe that this small father-son business could suck down a half million in hidden losses w/o it being obvious). Like another poster noted, 50 2002's would be worth a bit of cash, even if they were parts cars. Then there are apparently many different rooms/buildings full of parts from internet vendors, etc. I know they will often let you retain a car and home, but can't believe the judge would not garnish these assets for reimbursement.

Or am I just in massive denial....I mean, who hasn't made a firm 'never go in the basement' rule with their family - nothing weird about that, is there? Its my 'man cave'.

I agree. This just doesn't make sense to me. Can't believe the company owner would be that blind. Can't believe the 50 BMW's and warehouses of parts didn't cover most of the losses. Can't believe other car enthusiasts have not heard of this. Can't believe the company parking lot was full of 2002's (who was maintaining them?) and no one noticed. Just makes no sense. Definitely will never get the part of my life back I wasted on this story.....good grief!

[Stu Pedasho]

Originally Posted by BoostedN54

Is that considered cheating

It's not cheating until you get caught.

[SakhirM4]

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[jkoral]

Originally Posted by SakhirM4

http://mugshots.com/US-Counties/Colo....78857546.html

Ha, you beat me by 5 minutes. I was just about to post this. Was the 3rd hit in google, not sure why he thought omitting the last name with all the other details would provide some privacy.

[jmg]

Originally Posted by RickFLM4

Reminds me of my former neighbor who stood in my house telling me how good business was during a party for my wife's 40th. I later found out he was arrested for insurance fraud about a week before that conversation.

The story isn't really about BMW. It's about a pathological liar and thief who happened to spend what he stole on BMWs. However, despite the selfish actions by the thief, the part that has me scratching my head is his employer not being able draw much salary for 5 years before saying WTF and looking into it. The thief shouldn't have taken the money but business owners need to understand their numbers better than this guy did.

As a business owner, drawing salary and having money to spend are two different things. What he was really saying is that he probably didn't have to run $500k worth of payroll for himself in those 5 years because he was paying enough in taxes paying Terence's extra paychecks. That doesn't mean he didn't have money. He was probably pulling distributions regularly, much like most business owners do and the company was so much in the green that the extra money wasn't missed. I'm guessing the business was highly profitable and the owners were making close to 1,000,000 annually anyway. Seeing $100,000 less in payroll isn't that uncommon if you think the company is just in a slump or has enough deductions to not have to run that much payroll. Since Terence was their accountant, he could have easily explained it away so long as they don't look too deep into the books. I probably didn't explain this clear enough. Can an accountant clarify?

[Rocko123]

Def his wife...

[RickFLM4]

Originally Posted by jmg

As a business owner, drawing salary and having money to spend are two different things. What he was really saying is that he probably didn't have to run $500k worth of payroll for himself in those 5 years because he was paying enough in taxes paying Terence's extra paychecks. That doesn't mean he didn't have money. He was probably pulling distributions regularly, much like most business owners do and the company was so much in the green that the extra money wasn't missed. I'm guessing the business was highly profitable and the owners were making close to 1,000,000 annually anyway. Seeing $100,000 less in payroll isn't that uncommon if you think the company is just in a slump or has enough deductions to not have to run that much payroll. Since Terence was their accountant, he could have easily explained it away so long as they don't look too deep into the books. I probably didn't explain this clear enough. Can an accountant clarify?

I am a CPA so I understand your point. I should have said "income" as the owner said instead of "salary". It sounds like he pulled less out of the business in whatever form he used. Even if he was pulling out $1M / year and stopped getting 10% of it for several years, I think it would be noticeable. I've seen small business owners that pull $1M+ / year out of their business lose their shit when there wasn't as much cash as expected following a bad month of sales. I just think small business owners need to really understand their cash flows in detail because aside from theft, mistakes and waste occur. Getting one's arms around cash flows (including payroll) for a business with a father, son and 3 employees shouldn't have taken 5 years or however long it took, particularly when your CPA is storing cars and parts on your property. When you don't understand your accountant's asset accumulation, you shouldn't assume he's making money on the side even if you trust him, particularly if your income is declining.