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Self-Described 'Fraud Consultant' Charged With Another Embezzlement


 


 Average 5 out of 5


By Scott Patterson

A few minutes spent on the website of his private business, Webne Consulting Group, is enough to erase any doubt that Barry Webne intended to position himself as a "fraud prevention expert." For a company in dire need of anti-fraud consultation, Webne might appear to be the perfect answer to their troubles.

After all, Webne has been down that road himself. His perspective on fraud comes from the inside, having been convicted in 1995 of embezzling more than $1 million from a manufacturing company in Cleveland. His web site unabashedly proclaims him a "respected authority on the detection and prevention of occupational fraud, employee theft and white-collar crime" who "currently trains, lectures to and consults with financial professionals across the United States."

There are handy "Did You Know?" tidbits about fraud on his site, with warnings such as: "1 out of every 3 U.S. businesses has been a victim of white-collar crime or occupational fraud," and "less than 10% of all fraud is uncovered by outside auditors." The web page also hawks Webne's own handbook, "The Everyday Guide to Detecting and Preventing Employee Theft."

But according to a bombshell indictment announced earlier this month, Webne may have remained far too close to his subject matter. Prosecutors allege that during his charade as a fraud prevention guru, Webne was stealing more than $1 million from Block Communications, Inc., in Toledo. The suspected embezzlement occurred between 2001-2006, while Webne was employed by subsidiaries of the media company.

According to an article in the Cleveland Plain Dealer, Webne would write checks to himself and sign them using the stamp of the employee authorized to sign checks, prosecutors charge. Webne would then destroy the canceled checks when they were returned from the bank, covering the theft by creating fraudulent bookkeeping entries.

He even manipulated payroll to give himself unauthorized raises, prosecutors say. The alleged fraud is not a far cry from the original crime that sent him to jail in 1995, both in method and monetary loss.

In a candid interview with the ACFE in 2006, Webne hinted at something deeper than just greed as he reflected upon the crimes that led to his first conviction.

"I guess there were two sides of this," Webne said. "One side of me was worried about getting caught and always looking over my shoulder, and the other side was just concerned with getting... that next rush. You know, getting another 20 thousand dollars."

Such a comment comes as no surprise to ACFE President James Ratley, CFE.

"I've had fraud perpetrators tell me that it became an addiction for them," Ratley said. "When they steal and don't get caught, it just reinforces their self-assuredness and desire to commit the next fraud."

In the interview, Webne talks about how easy it was to defraud the manufacturing company where he served as controller. "There was no oversight," Webne said. "I think the company I worked for was typical of American companies. They left everything up to me as long as the financial statements were good - as long as the financial statements were turned in on time, nobody bothered us.

"Nobody paid attention to the accounting department. We were worried about getting parts out the door, not whether inventory was stated correctly; although that was secondary. That was obviously important in people's minds."

Perhaps Webne found the same loosely-controlled environment in his new employment, and the "rush" that he spoke of was simply too tempting to resist. Maybe he felt he needed or deserved the money, or maybe he simply felt like he was smarter than those around him and would commit his crime undetected.

Or perhaps he is innocent. But as appearances go, it doesn't look good for Webne. According to the article in the Plain Dealer, prosecutors and Webne's lawyer report that he is "cooperating" with their investigation. No public statements of innocence have been made by Webne, or by anyone else on his behalf.

Whether innocent or guilty of the charges, the nature of Webne's responsibilities - and access - with his former employers is surprising, Ratley said.

"It surprises me that someone would put him in that position," Ratley said. "Trust equals opportunity - and it is indeed common for a fraudster to perpetrate a second fraud when they get in a position of trust."

Ratley said he is especially unimpressed by Webne's claims of being an "authority on fraud."

"Fraud perpetrators do not conduct training for the ACFE for a simple reason: their knowledge is limited to their own experience," Ratley said. While convicted fraudsters like Webne are often invited to volunteer to tell their personal story, Ratley said the experience is always limited to "how they perpetrated the fraud and how they were eventually caught."

For now, his web site remains unedited and untouched by the allegations, still trumpeting Webne's self-proclaimed status as an anti-fraud consultant. Whatever the result of his current legal troubles, one thing is certain: Barry Webne's story has added a new chapter, and possibly another experience to share in his presentation. The question, however, may be whether anyone - save a judge and a jury - will care to listen.

 

CLIP 1: "I loved my job."
Webne provides a brief background on his convictions, as well as his job and the lack of oversight at his company.


CLIP 2: "I didn't want to work for it."  

Webne describes his motivation to make more money, and tells of how he began committing fraud.


CLIP 3: "At that point... I didn't think I was going to jail."
Webne discusses the "knock at the door" and being caught.


CLIP 4: "If you put me in a position of trust again... chances are I'm going to violate that trust."  

Webne starkly admits that he cannot keep himself from committing fraud if put in a position of opportunity
 




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