Accounts Deceivable Podcast Series: Season 1, Episode 2 - Family Fortunes

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Speaker 1

Before we start, this episode deals with subjects such as sexual assault and suicide that some listeners may find distressing.

Speaker 2

I can remember my heart beating out of my chest. I can remember not being able to breathe well. I can just remember being in a complete panic, not knowing if this was the moment that I would get busted, but I cared so much about doing what I promised my brother that I went through with it.

Speaker 1

Welcome to season one of Accounts Deceivable, a podcast about a growing category of white collar crime, invoice fraud, and the devastating impact it has on people, companies, and communities. Have you ever wondered what it takes to turn a regular employee into a white collar criminal?

In this episode, we meet Diana Winston, an office manager who stole hundreds of thousands of dollars from a family firm. This is a story about the thin line between right and wrong. Facing opportunity and temptation, how many of us are strong enough to say no?

It was a hot, sticky day in Downtown Indianapolis.

Diana turned up the air conditioning in her car and slowly turned the key in the ignition. She was sweating, and not just because of the weather. For the last six months, she'd been stealing money from the family-run manufacturing company where she worked as an office manager.

In that period, she had drained nearly $350,000 in fraudulent Capital One credit card transfers.

Yesterday, her world had come crashing down. Capital One had requested a three-way call with her and her company's bank.

Diana was kicking herself. It was the first time she tried to steal more than $10,000 in one hit. She suspected it might raise a flag and it did.

Diana drove a few blocks from her office and dialed into the call from her car. She was terrified.

Speaker 2

I can remember my heart beating out of my chest. I can remember not being able to breathe well. I can just remember being in a complete panic, not knowing if this was the moment that I would get busted.

Speaker 1

On the surface, nothing in Diana's past hinted at a criminal future. Born and raised in the outskirts of Indianapolis by two Catholic parents, Diana was the eighth of nine kids. She had a happy childhood running around the neighborhood with her brothers and sisters, riding bikes and playing tennis. From an early age, she developed a love of numbers. Math was her best and favorite subject.

Speaker 2

My brother, he was working in an office where he was the controller, and he needed some accounting help. And so he would bring me in there every summer. By the time I was 14, I knew I wanted to do something with accounting.

Speaker 1

However, behind the scenes, things were not as rosy. Although her father was strict, a tough disciplinarian, neither he nor her mother were good with money.

Speaker 2

A lot of what took place with my family was face value, what would look good to the congregation. Behind the scenes, what they did with their finances was not build for the future, save for, your kid's college. They squandered their money. They didn't teach us to be financially responsible, and I do believe that that helped to play a part in my crime later on.

Speaker 1

Diana graduated in 1986 with excellent grades and was promptly offered a scholarship to Indiana Business College. However, she didn't accept the place. Instead, she upped sticks and moved to Germany with her boyfriend, who was serving in the U. S. Armed Forces and stationed at Rumstein Air Force Base. While in Germany, she had three children, Daisy, Jane, and Arthur.

Her husband was often away on temporary duty for long periods of time, but Diana didn't mind.

Speaker 2

Germany is so beautiful, and so everything around me was gorgeous. It was just me and the children. Those were the happiest days of my life. I would take those back in a heartbeat.

Speaker 1

In 1990, Diana and her family left Germany and moved back to South Carolina and into the wreckage left by Hurricane Hugo. For the first few years, her husband was away on Operation Desert Storm. When he returned, their relationship started to deteriorate.

Speaker 2

He had come home from one of his temporary duties, and I knew his abusive nature. I I knew I couldn't do this anymore, so I actually just packed the car with the kids and all of their belongings. Could get in the car, and I drove to Indiana. And I stayed with family for a while.

And it was about a year after that that we ended up divorced.

Speaker 1

Diana was left to face up to the painful reality of being a single mom with three young kids. She got organized, moved back to Indiana, and eventually found a role as an office manager for a widget manufacturing company that had 50 members of staff, most of them on the factory floor. They had just won a major contract with the US Army and were turning over $6,000,000. She settled in quickly. Within six months, she was indispensable. Then she met John.

Speaker 2

First of all, he had this long ponytail of hair, and he looked like a Harley Davidson kind of bike rider to me. The hair was for Locks of Love. His mother ended up passing from cancer. What ended up happening was at Christmas time, he came and he put a bunch of toys in the Toys for Top box. And I knew he didn't have kids and I knew those were the most popular toys. So doing payroll, I looked in the payroll file and found his phone number and I called him. He thought it was the people he worked with down in service that were teasing him, making it up, because I had said no so many times.

Speaker 1

Six months later, they were married. Life was good. For the first time in her career, she had her own office adorned with plants, a postage machine, a coffee maker, and piles and piles of files. She loved the people she worked with, including her two bosses, the president and vice president, who were kind, respectful people. However, she did have one nagging concern, the firm's slightly laissez faire attitude to finances.

Speaker 2

I went to him, the president, and asked him a question. This is early on before I've done any illegal actions.

And he said, let me get this straight with you. I don't want to ever talk to you about debits and credits. I hired you to do the accounting, and I don't expect to have to tell you how to do your job.

Whenever I do the check runs, I would give them to the president, but he never looked at them. He just blindly signed them all. And after a given period of time, I knew what I could get away with and what I couldn't get away with.

Speaker 1

In addition to her boss's lack of interest in the inner workings of the accounting system, there were certain governance measures that were also missing from the firm's operations.

Speaker 2

Segregation of duty is one of the first things that you need to be certain is taking place within anything to do accounting-wise.

So we had a president and a vice president who had logins, but neither one of them ever used them. They were always preferred to be in Excel. Excel's a great tool. I love Excel. But at the same time, you've got to do your due diligence and and get in the system and understand it, especially if you're owners.

Speaker 1

The company didn't want to pay for full financial audits. The president thought they were a waste of money. Instead, the company had ad hoc compilations, which are much less detailed. Although they were conducted by an external auditor, he was a friend of the family and didn't look at anything in the general ledger. Then life threw Diana a massive curveball.

One night, she was at home cooking dinner for her husband when the phone in the hallway rang.

Who was calling at this time of night, she thought.

It was her ex-husband's new wife, Miranda, who quickly relayed news that shocked Diana to her core. Her son had been arrested for sexual assault.

She ran outside, jumped in her car, drove down to jail, and begged the officer on duty to let her inside.

He sent her home.

Speaker 2

My son was immediately, he was arrested and put into, Marion County Jail, which is Downtown Indianapolis.

And when I got notice of it, I just I freaked. I didn't know anything about courts, police, jail, and so I thought, you know, get to a lawyer. So the first lawyer I spoke to said it was going to be $7,500 before he would even consider helping my son.

Speaker 1

She didn't have $7,500, and, if it came to it, she didn't have any money for bail either. But she wasn't about to let her son rot in prison. It only took her a few hours to make a fateful decision. She would secretly borrow the money from her employer and figure out a way to pay it back afterwards. She started to plan.

Speaker 2

I took many, many walks. It was around the high school that was near our home, a pretty peaceful, beautiful neighborhood. What I would do is go through these passages in my mind of, okay, if you do this, you'll get this far, and then I'd be like, nope. You'll get caught right there. And I just kept doing it until I came up with a way that would work.

Speaker 1

Diana realized that the company credit card and her own personal credit card were both provided by Capital One. She worked out that if she created a PO in her system, quickly canceled it, created a dummy invoice, and then added it to the general ledger, she could transfer money from the firm's corporate credit card onto her own.

You might wonder why the dummy invoices weren't picked up. Ingeniously, Diana used a sandbox to create an almost perfect replica of a legitimate invoice, and her system allowed her to raise then quickly delete a PO after costs had been posted against it. But if anyone had checked the general ledger or an audit had been conducted, it would almost certainly have been flagged.

Speaker 2

I definitely got a rush. I got a rush from getting all of the invoicing correct, getting the check signed. Once I had it back, I felt so proud of myself.

Speaker 1

As soon as the funds cleared, she leapt in her car and drove downtown to the lawyer's office. He was surprised to see her back so soon, and even more surprised when she handed him a check for $7,500. She fixed her eyes on him and told him it was time to get to work.

Two weeks later, Arthur was released on probation and placed on the sex offender's register. When Diana picked him up from jail, she was underwhelmed by his response.

Speaker 2

Entitled is the thing that comes to my mind. Yes, he was scared. Yes, it was a horrible experience. But now that he was out, I think that as a divorced mother of two, I felt guilty for taking their father away from them. I really didn't realize just how bad it was until that moment where I'd risked everything, and it wasn't like he was super grateful at all.

Speaker 1

Arthur had had a challenging relationship with Diana's husband, his stepfather, who had moved out eighteen months before Arthur was arrested.

Diana blamed herself for failing to build a bridge between them, and deep down she felt this failure was the key to Arthur's problems.

Diana had always intended on repaying the money she stole as soon as she could.

However, a few weeks later, she found herself in the middle of another financial emergency.

Speaker 2

Before I knew it, my sister was having trouble paying her rent. My parents were having trouble paying their rent. Their electric was turned off. Their hot water was turned off.

So those were the next two times that I took funds.

Speaker 1

Diana couldn't fight her natural inclination to sweep in and save the day. She used the same technique to steal $25,000 for her mother and $12,000 for her sister.

Speaker 2

I would create POs that would allow me to make it look like we had spent more money with the vendor than we had. So after I got the transaction in the general ledger, I would cancel the PO.

Speaker 1

According to Shannon Kreps from accounts payable software company Medius, this part of the story is particularly worrying.

Speaker 3

It's kind of shocking that she was actually able to have a purchase order canceled after an invoice was placed against it. You wouldn't be allowed to do that today in a system. However, there are gaps that do exist between an invoice coming in and a payment going out the door, and that probably happens more often than we think.

Speaker 1

Diana also generated fake invoices.

Speaker 2

That was a fake invoice for, like, widgets of some sort. And I made sure that the invoice number for it was in line with their invoice numbers. So if by chance was any kind of a call that I was not privy to or I was unaware was taking place, the invoice number was in line with their sequence, the dates made sense, the quantities made sense, the part made sense, everything about it would look plausible, would look correct.

Speaker 1

Here's Shannon again.

Speaker 3

Invoice fraud is really about fake invoices. It's about people sending in invoices for goods or services that never really happened, but they're assuming that you're so buried in paperwork that you're not gonna actually have time to check that out.

Speaker 1

In a minute, we'll hear Diana's story spiral out of control as she decides to take her own life before a timely intervention from Martha Stewart. Before that, a word from our sponsor, Medius.

Speaker 4

Invoice fraud is costing businesses billions of dollars every year. As cyber attacks grow in sophistication, more and more companies are accidentally paying out thousands, even millions in bogus invoices. Medius is an accounts software platform that enables finance professionals to combat invoice scams by protecting the integrity of their supplier data, auditing the invoice process in real time, and monitoring for insider fraud. For more information or a demo, visit www.medius.com.

Speaker 1

Let's get back to Downtown Indianapolis, where Diana is sitting in her car, bone in her trembling hands, as Capital One and her company's bank discussed an anomalous transaction of $12,000. Diana was kicking herself. Although she knew any spend over $10,000 would automatically raise a flag, she had promised her eldest brother $12,000 to help him make payroll.

Speaker 2

I had a brother who owned a business. It was a insurance title company, and that went bust at that time, and so he was struggling to make payroll. So I was taking tens, 10,000, 15,000 in order to help him pay his payroll. I told him that I had surrendered a 401k and that he was going to have to pay the fees when he repaid me.

Speaker 1

Diana knew her brother needed the money or he would need to lay off half of his workforce, so she decided to tough it out. After a few stressful minutes, the bank approved the funds. Diana had got away with it.

Speaker 2

And the bank approved that it was a real check, that it was accurate, that it was fine to cash, and I was able to pull more than my credit limit off. I just had to sit there probably for five minutes or so just straighten my mind out. I wasn't well the rest of the day at work. Physically, it'll do things to you that you would have never expected.

Speaker 1

Over eighteen months, Diana stole a total of $350,000 from her employer. Although the majority of the funds were used to help friends and family, she also purchased clothes for herself and spent a lot of money buying fancy coffees from Starbucks.

Speaker 2

I bought my kids a lot of clothes so that when they were at school, they had the hottest, coolest clothes. I was working out then, paying a trainer. I can remember, you know, a lot of gym clothes that I bought. I can remember spending $150 on a pair of sunglasses for my daughter, just greed, setting in big time. I can remember thinking, nobody's as smart as me. They'll never catch me.

Speaker 1

However, deep down underneath all the money and material things, Diana was miserable. Her behavior, particularly around those she loved, was deteriorating.

Speaker 2

My husband, he was just ready to divorce me. I had become so mean and so hateful. He had his own business, and he really needed my income. And so that was the only reason. He hadn't figured a way out of the marriage yet, but he would have been long gone.

Speaker 1

Her anger wasn't just confined to the house either.

Speaker 2

So we had this church across the street from us, and they always parked in front of our house. And, my kids were coming to see me that day, and they couldn't find anywhere to park. And so I was really super upset about it. In the middle of the pastor giving a sermon, I went in there and called them every name in the book, used every cuss word you can think of, and told them to get their cars out from in front of our house before I keyed them all and slashed the tires. And when I went home, I was so proud of myself. You know, I was just, like, boastful.

Speaker 1

Diana never believed she would ever get caught. Besides, if she did, she had an escape plan.

Speaker 2

I would drive down the road, and if I ever saw people who were in jail, uniforms cleaning the sides of the road, I thought that'll never happen to me because I'll take my life first.

Speaker 1

One Friday, Diana's luck ran out. She was in the office drinking coffee out of her best mom in the world mug when a good friend of hers put her head around the door. Capital One was on the phone and they wanted to talk to the president. Diana panicked.

The president was sitting in a windowless office talking to fellow executives about the company's growth strategy. He was pretty angry when his secretary interrupted and told him that the credit card company needed to talk to him immediately. Can't someone else take the call? He asked gruffly.

No, she said. It has to be you. Diana stood by her office door and listened intently as her boss sat at his desk grumply and picked up the receiver. Then she heard him say, No, she's my office manager.

Those five words hit her in the chest like bullets.

She knew she was rumbled.

Speaker 2

My whole body, like, lost control of itself, and I could tell I was gonna need to use the restroom and very quickly. I've never been in that kind of a place with that much fear before. The police station for that town is right across the street. So I was pretty sure I was going to jail, and I was going to jail really quick.

Speaker 1

While Diana was locked in the bathroom for two hours, retching, vomiting, and desperately trying to figure out how to escape custody, she caught a break.

Speaker 2

The only thing that Capital One told the president was that they had a check for their office manager's credit card account, and was that accurate because their fraud algorithm had kicked it out. And so they thought it was just that one incident, which was under 10,000, and so they had no idea how far and wide it was.

Speaker 1

When she returned to her desk, Diana was surprised to find no police officers waiting for her. She couldn't hear any sirens. The president was back in his strategy meeting.

After half an hour or so, the president's number two, the vice president, swung by and asked her a few questions about the check.

Speaker 2

I played off like I didn't know what was going on.

I think he was so shocked that I had done it. I was smart enough to field off the questions and answer them in a way that would make him not be as concerned and to leave me alone. My goal was to get out of there, to harm myself so I didn't have to go to jail.

Speaker 1

At 5:00, the office started to empty as people headed off to spend the holiday weekend with their families. Legs shaking, head spinning, Diana picked up her keys, locked her office door, slid into her Toyota, and slowly drove home. She knew it was only a matter of time before the management team uncovered the full extent of her crimes. She suspected that her stay of execution was down to the fact payroll needed to be filed.

Speaker 2

I was the only one that knew how to do payroll, and they were getting a large profit sharing check on that payroll.

Speaker 1

She went home and tried to act normal for the weekend.

Speaker 2

I had to fake it as though everything was fine and everything was normal, but I can remember being in the shower just crying and crying because I knew, you know, my life was about to end.

Speaker 1

On Sunday, she drove to the office and completed payroll.

Speaker 2

The reason that I did payroll, I did it because I thought I was gonna be dead and my husband would need my money, and my sister was working there, so I knew both of them wouldn't get paid if I didn't do payroll.

Speaker 1

On Monday, Diana woke up planning to end her life. She told her husband and her employer she had a doctor's appointment, but instead she drove to a drugstore and picked up a bottle of sleeping tablets and a large bottle of vodka. She then abandoned her car outside a local Walmart before walking to a local motel that would allow her to pay in cash without showing ID. In her room, she had a few large glasses of vodka, looked at herself in the mirror, swallowed the pills, closed her eyes, and drifted away.

A few hours later, she woke up.

Speaker 2

I woke up and I was violently ill, and I had this image. So I had the devil on the side and Christ on this side, and so I just felt like the devil was like rubbing his hands together like, finally, I'm going to have all of her. And then I felt like the Lord said, you can't have her because I have great plans for her.

Speaker 1

In that dark moment, Diana realized that she had a choice.

Speaker 2

I'm out of money. I had soiled all my clothes from being sick. And so I decided, as stupid as it sounds, to turn the TV on.

Martha Stewart was on the television, and she was, talking about this white chair. It was a white fluffy chair. And I had remembered that she had to go to jail, and I thought, this is ridiculous. If Martha Stewart could go to jail and survive it, you can go to jail and you can rectify what you've done wrong, and maybe your kids and your husband won't forgive you.

Speaker 1

Diana picked up her belongings, walked back to her car, and drove home to her husband, John. He had been frantically searching for her all day, phoning friends and driving around the local neighborhood. He thought she had been kidnapped. Towards the end of the day, John took a phone call from Diana's workplace.

It was the president. He explained suspected of embezzling funds from the company. John had no idea about her criminal activities. Diana did all the banking, had all the passwords, and had created clever mechanisms to avoid detection.

Speaker 2

A lot of people are like, how in the world did he not know? Was he blind? Was he stupid? Well, I used a PO box. I was very effective at hiding it.

Speaker 1

When Diana staggered in through the front door, half dressed and covered in vomit, John put two and two together. Diana immediately confessed, but there was no time to react. They had to get to hospital and fast.

Speaker 2

And my husband, they took me to the hospital, and I had to have my stomach pumped. It was pretty awful ugly scene at that point. I have no physical harm from any of it and I really should. When I was released from the hospital, my husband didn't come and see me for most of the time I was in there.

My kids did come and see me with, bank papers for me to sign my relinquish my rights to their bank accounts. You know, those kinds of things were happening to me while I was laying in the hospital bed being sick still. My son wrecked his car on the way to see me at the hospital. When I left and went home, my husband really didn't wanna talk to me, in fact, he wanted to kick me out of the house, but his sister told him that that would be a mistake and that he needed to show me grace, because you would think a sibling would have been like, kick her to the curb, my goodness.

But she's never done anything but be loving and kind and considerate to me, and I'm always grateful for that.

Speaker 1

While Diana was recovering in hospital, the police were investigating her crime. In total, she had cut 44 fraudulent checks and stolen over 350,000. Her lawyer agreed that once she returned from hospital, she would surrender herself. However, in a twist of fate, her arrest warrant got lost on an administrator's desk. This meant Diana got an extra month at home before she had to report to the county jail.

Speaker 2

It was really pretty crazy, all that extra time that I had at home with my husband that month. Those thirty days made all the difference in our marriage not going under.

Speaker 1

On April 2, it was raining hard in Indianapolis as her husband drove Diana to Hancock County Jail.

Speaker 2

My son was in school, but my daughter was with us, and she was in the back seat. And I can remember tightly holding her hand from the front seat to the back seat where she was, and knowing, you know, all of the things that I couldn't possibly imagine. It was all starting to really settle in. Right? Plus, you know, I'm about to surrender myself and give up all my freedom.

We get there, I walk up the stairs in the rain, we didn't know that once I had contact with the officer, I could no longer have contact with him. So we weren't able to hug and the victim impact, the video he has, yeah, he cries through that as he explains how hard that was. They put me in what is called the visitor's station where the prisoners sit with the glass in front of them. I was the only one in there, and then this officer came to me and read my charges to me.

Of course, I shook my head and said, yes, those are all my charges. I had eight charges, four felonies for forgery and four for theft, which is fortunate because I should have had many more. Right? And so he just kind of chuckled at me and he said, these are some serious charges.

Are you really surrendering? So then they do the situation where they check you for lice, they make you do this horrible shampoo, you have to do this shower thing where they can, you know, see every bit of you to be sure you're not bringing any paraphernalia in of any kind.

And then they take you to the spot where you're going to be staying and the door slams shut behind you, heavy, heavy steel door. Yeah. I'll never forget what that felt like. That was horrible. The loneliness and the shame, all the people that you hurt, that was the hardest part.

Speaker 1

Two months later, the judge handed Diana a four year sentence, which would see her locked in prison for a minimum two years. Although John was still angry, he agreed to stand by her.

Speaker 2

He said he was glad because he was so mad at me, that he didn't want to talk to me. And so those eight weeks kind of gave him some healing time. He was kind of glad that I had to go through the body searches and things. He was miserable on the outside trying to not lose everything, trying to help these kids that really didn't like him. We wrote each other often, and he would come every other weekend, and my daughter would come every other weekend.

Speaker 1

After sentencing, Diana was transferred to a maximum security prison in Rockville, Indiana.

Speaker 2

So I had to live with some of the worst of the worst, people who have murdered. It was very difficult to sleep. And so it turned out that my roommate happened to be the guru. If anybody wanted some tobacco, they knew they had to get it from her. And so everyone was afraid of her because she had so much power.

She liked these red candies called fireballs, and I happened to have a plethora of them from commissary. I just never really liked them too much. That is how I gained favor by supplying her with fireballs. They pretty much saved me from getting hurt in that dorm.

Speaker 1

Diana was released in April 2011 and initially struggled to adapt to the outside world again.

Speaker 2

I just wanted to, like, hide in a closet. I didn't want anyone to know I had eight felonies. There was too much color. There was too much noise.

All my senses were just, inundated in a way that I couldn't cope.

Speaker 1

It was her husband, John, who stepped in, picked her up off the floor, and sent her out to work.

Speaker 2

My husband said, look, you need to find a way to make money. Get out there and do something. So I started looking, and I found someone who accepted speakers like myself, and people could get CPE credits for that, and I could use the funds to pay my restitution. And then the next thing I applied for was an accounting job in a telecommunications type of field where I realized you can live with eight felonies.

Speaker 1

Diana spends a lot of her time going back into prisons and telling her story.

She takes full responsibility for her actions and will never fully forgive herself for her crime. However, she also acknowledges that her employer made mistakes, too. She has advice for all companies out there.

Speaker 2

People get to know their employees, and if there's pressures in someone's life, they're gonna act differently. They're gonna look different to continually ignore it. They may not take the opportunity, but leave that open door.

There's no reason that someone should have carte blanche of a system without checks and balances in it.

And the only reason they do is because people are lazy. So everybody needs to know what their job is and do it.

Speaker 1

Here's Shannon from Medius again.

Speaker 3

At Medius, we actually believe in what we call the four eyes principle. So you should always have two sets of eyes on everything that occurs. Even in a technology system, you need something that will help alert you to anomalies that will happen. There's also a big thing about separation of duties. You shouldn't just have one person who's able to set up a supplier, put an invoice in the system, and pay that invoice. That's just a big no no.

Speaker 1

Shannon also has some sage advice for Diana's former employers and anyone who runs a business.

Speaker 3

I would tell her organization, and I'd actually tell her president that you just can't trust everybody. It's nice to be able to have that faith in individuals, but you do need technology to back you up and make sure that things don't slip through the cracks.

Speaker 1

Diana also urges all businesses to have regular audits.

Speaker 2

If you have the Achilles' heel of having so much money stolen, that could probably be upwards of $20,000. It's well worth the money spent.

Speaker 1

Today, Diana's future is the brightest it's been for a long time. She and her husband just moved into a beautiful new home. She has a job as a finance director. Her kids have grown into amazing people, and she has rebuilt her relationship with God. But she knows she must always remain vigilant. Never let her guard down because temptation can strike any place, any time.

Speaker 2

When I was first home and my daughter couldn't make her rent, and my husband had me make a deposit for his business, I was so close to taking that money to her rather than putting it in the bank. But I actually went to the bank. I pulled the night drop open, and I dropped it in there and shut it. And I looked up and I said, it's on you, God.

Speaker 1

For more chilling stories from victims and fraudsters alike, check out the Accounts Deceivable podcast on Apple, Spotify, or wherever else you get your audio fix.