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Why there was no control over Positive Action funds?

 Positive Action

IRELAND – The audit report by the Health Service Executive revealed that there was no control over Positive Action funds. Positive Action Ltd was founded by Bernadette Warnock (63) in 1994 to help women who contracted Hepatitis C through contaminated blood in maternity hospitals. Warnock herself has been living with Hepatitis C for years. She contracted it at age 24. 

She has pleaded guilty at Dublin Circuit Criminal Court to 71 counts of theft and fraud. She committed these crimes while she was responsible for handling charity finances. The court heard that, Warnock was “the face of Positive Action” and had full control of the charity’s bank accounts.

In 2011 there was a tug-of-war as board members began to question Warnock’s handling of finances. She was removed from the finance committee when it emerged that she was hiding stubs of cheques. The safe key was taken from her as a result.

Defense counsel Ronan Kennedy told the court that Warnock could only afford €8,500, but was expecting an inheritance from her family which will cover the outstanding amount.

 Who was funding Positive Action?

Positive Action had 730 members and was mainly funded by The Health Service Executive (HSE). The HSE allocated €2.3m of taxpayers’ money between 2009 and 2013. It only ceased funding in March 2014 after identifying serious concerns in Positive Action handling of funds.

Tweet this:Positive Action was closed down in 2014 following a HSE audit which found out the executive stole funds.

How were funds stolen?

Positive Action was closed down in 2014 following a HSE audit which found out the executive stole funds. Prior to this, the release of the report had been delayed because of the Garda investigation (an Garda Síochána is the national police service of Ireland). The report was only released later when the police investigation was completed.  

The audit revealed that Warnock stole over €116,000.  In 2012, the Irish Times reported on the following irregularities:

  • The report shows that funds were wasted on overseas trips, weekends away, dining, directors’ expenses and complementary or beauty therapies.
  • The spending included a whopping €325,000 on weekends away in Ireland, €104,000 on overseas trips, and €87,000 on “restaurants, take-outs and groceries”.
  • The irregularities included a  €152,146.83 between 2009 and 2012 which was paid in a series of cheques into Warnock’s account but recorded with a different payee.

According to The Journal, Warnock says she has ‘nothing to show for the money which she stole from Positive Action Ltd. When journalist asked her to find out what she spent the stolen money on, she replied: “that’s the worst part of it, I have nothing to show for it”

Warnock has a history of fraud

The court heard that Warnock has four previous convictions all involving forging cheques from her former bosses. According to presiding Judge, Melanie Greally, stealing donated funds is one of “the most grievous offense committed by a charity leader.’

The court also heard that Warnock had been writing cheques from the charity to herself. She then forged the second director’s signature that was required on the cheques. The court ruled out that Warnock should pay back €63 500 to HSE.

How Positive Action could have avoided this?

The audit report by the Health Service Executive revealed that there was no control over Positive Action funds. It was too late when directors smelled a rat. Money was already stolen. The use of paper-based systems like cheques and invoice only made the stealing of funds easy for Warnock.

The charity organization should have avoided this by employing a clever purchase order system that helps budget well and track all purchases. For example, Procurementexpress.com, is a purchase order system that gives charity directors and CFOs a peace of mind.

With Procurementexpress.com a Positive Action CFOs could have:

  • rejected an exorbitant PO request made by Warnock,
  • commented on the PO,
  • approved POs even while on the road to the next meeting,
  • accessed purchases report anytime,
  • made sure that staff members spend within budget,
  • had total control over charity finance.

Any charity organization serious about doing good should employ a system that helps to end wasted spend. Don’t let one fraudster ruin the reputation of your organization. What are you waiting for? Sign up today and put Procurementexpress.com on the test drive.

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