Minnesota Accountant Has Three Years to Think About Life Choices After His Embezzlement Put Father-in-Law Out of a Job

Ronald Schaeffer of Fairbault, Minnesota was the one-man accounting department of Environmental Tillage Systems Inc. He was, in the words of Kevin Born, the company's CEO, the “most trusted employee” at ETS. Disciples of COSO would tell you that this is far from an ideal situation. You know, no segregation of duties and whatnot.

This precarious set-up at ETS led to some questionable choices by Ronnie, including helping himself to $400k of the company's money and using it for the usual reasons:

Schaeffer pleaded guilty in January to using the money from August 2008 to April 2012 to build a lake house in Elysian, Minn.

By forging about 100 checks ranging in amounts from $400 to $12,000, he also made payments on home equity and car loans, paid membership dues to a golf club, took vacations, sent his children to private school “and generally enjoy[ed] a lifestyle well above his means,” according to a prosecution court filing ahead of sentencing.

The court found that this effectively raised his salary $100k and that during this time, the company was in "dire straits financially." 

When a company finds itself in such a predicament, wholly unaware that a fraud is occurring, it usually takes action which can include layoffs and that was something that ETS did. These layoffs, as it turns out may have created some tension in the Schaeffer household: 

Among those let go was an assembler who also is Schaeffer’s father-in-law, Born added. “He was laid off for six months,” Born said. 
Luckily this was temporary setback for Scaheffer's FIL who was only out of work for six months. This might — MIGHT — explain why Mrs. Schaeffer hasn't split. 
Yes, Born added, Schaeffer and his wife are still married.
For better, for worse!

Father-in-law among co-workers laid off as Faribault accountant stole $400K [MST]

Latest Accounting Jobs--Apply Now:

Have something to add to this story? Give us a shout by email, Twitter, or text/call the tipline at 202-505-8885. As always, all tips are anonymous.

Comments are closed.

Related articles

Happy 125th Birthday, KPMG!

Today is August 2 and KPMG is turning 125! Way to prove the naysayers wrong as they pointed and jeered and insisted that we’d be down to just three Big 4 firms by the end of the 2010s. YOU GO, KPMG. Don’t listen to those haters. There’s a press release because of course there is: […]