Great Women In Fraud

Episode 50 Cheryl Obermiller, Fraud Points

September 21, 2021 Kelly Paxton, CFE Episode 50
Show Notes Transcript

This is a 2 part special episode featuring Cheryl Obermiller, author of Fraud Points.  I wanted to split it in 2 because we talked for over an hour and I don’t want you to miss anything.  Some people only have 30 minutes to listen to an episode.  Please let me know if you like this?  

Cheryl’s story is amazing, entertaining, and most of all educational.  I laughed so hard but that doesn’t diminish how incredibly important her message is.  I have her book.  It is listed in the show notes.  Get yourself a copy.  Cheryl just sent me a message about how we say many of the same things in each of our books.  Look forward to a VIP event.  VIP is Victim Cheryl, Investigator Kelly and Perpetrator who is yet to be determined.  Let’s get started. 

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CherylO: Well, thanks for having me, Kelly. I'm really looking forward to this and you know before we start, I want to make sure people know there was a reason you don't know how many people there are, like me, and it is because people are embarrassed to come out they feel stupid.

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CherylO: 28 years ago started this little construction services company because I'd worked in my husband's engineering office and it was supposed to be a little extra money for piano lessons and vacations. Because eight kids drink a lot of milk, so you know, there was that.

So I started this little business and it turned out, I was really good at it and in seven years it was a multimillion-dollar business. Now the good news is everybody thinks that's totally awesome and it is.

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CherylO: That's kind of how it was for me with hiring a real accountant, so I thought that my job was then to go out and run my company and bring new clients and you know and make sure that the company was functioning and then meet with the accountant and have her tell me how my business was functioning financially, so, in other words I hired an accountant, without having any idea of what I needed to do to manage an accountant, and you do not have to be an accountant to effectively manage an accountant, but if you don't know how to do that, you are on very dangerous ground so.

Yes, I hired my accountant Tammy and August 2001 and after my embezzlement was discovered eight and a half years later, in 2010 I found that I hired Tammy in August 2001 and in December of that year that three and a half months later, she forged her first check.

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Kelly Paxton: She had glowing reviews from her previous employer, but also the previous employer left the United States and move to Canada and they might not have even known she was stealing.

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CherylO: I have no record, no proof. I've never even heard a hint that she did this anywhere else, and people need to know what I did a very, very careful hiring process I didn't just hire somebody who I thought sounded good answering the phone or whatever, I had a friend who's a CPA worked in management and another company she had interviewed Tammy and felt that she was totally overqualified for the job she was looking for so she referred her to me and then she came in and interviewed tammy with me on my behalf, we went over everything her references were checked.

It was a very, very diligent and careful hiring process, and I know a lot of people don't do that, and then they wind up realizing they've hired people that had criminal records or.

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CherylO: You know and they've done that unknowingly my hiring process was extremely careful so even somebody with the best references and the best abilities still has to be managed.

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CherylO: You know past performance that seems great is no indication that they will be honest with you, maybe they're just a really good thief and nobody caught them before.

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CherylO: You know, clean out from behind the file cabinets and reorganize paperwork and do that kind of stuff so she called me on January 10 2010 and said.

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CherylO: My husband left for work really early and a big storm came up and blew so much snow into my driveway up against the garage door I can't open the garage doors and get out.

And I said, well, no one cares because it's cold and snowy and we don't really have much to do today so don't worry about it, you know come in tomorrow so that day.

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CherylO: I did something that I did not normally do I got the mail, so I was there when the mail came in the mail carrier brought in a certified letter from our favorite people at the Internal Revenue Service telling me that since I had ignored all of their communications.

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CherylO: Yeah, I'll check into it, will you know we'll and we'll talk about it tomorrow, I got off the phone and I called my husband and said, I have a problem, like seriously, I have a problem.

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CherylO: I got a phone call from one of my boys who said Tammy is here early.

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CherylO: we've made her sit in the foyer. We haven't let her go back and touch anything but she's sitting here waiting for you, I said fine i'll be right there hang up next phone call that came in was the banker saying, I have two checks come in overnight tell me how you want me to handle them.  So what are some will first check was, and I think it was checked with utility bill, you know few hundred dollars, I said fine that's fine send it through.

So the second check is one that you wrote to Tammy on Tuesday.

I said I was out all day Tuesday, one of my children was terribly ill, I was at the doctor all day I wasn't even in the office Tuesday to write a check well.

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CherylO: She was the most trusted person in the company. Absolutely you know the guys all knew Tammy would look through I mean construction crews will come in at the end of the week gather up this wretched wad watered up receipts mixed in with old taco bell wrappers.

And dump them on the accounting desk to sort out and they knew that the next week, they would get a little note that said. You rented a movie in your hotel room there was a $3 99 cent charge and on two of those receipts you bought a coke and a Hershey bar so I'm deducting $7 and 43 cents from your next paycheck they knew like she watched everything.

This is to keep you coming back next week.  Cheryl is on a mission to help other business owners not become victims like she was.  She has truly made lemonade out of lemons.  Here is a brief excerpt from her book:  

Also, you aren’t able to see the video but Cheryl has some great information about where to keep your checks and where to keep your Smith and Wesson!