Kelly Richmond Pope - Fool Me Once

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Copyright 2023 Kelly Richmond Pope

All rights reserved

No part of this publication may be reproduced, stored in or introduced into a retrieval system, or transmitted, in any form, or by any means (electronic, mechanical, photocopying, recording, or otherwise), without the prior permission of the publisher. Requests for permission should be directed to , or mailed to Permissions, Harvard Business School Publishing, 60 Harvard Way, Boston, Massachusetts 02163.

First eBook Edition: Mar 2023

ISBN: 978-1-64782-391-7

eISBN: 978-1-64782-392-4

CONTENTS

FOREWORD

Fool me once, shame on you; fool me twice, shame on me.

This well-known proverb was made more famous when George W. Bush fumbled the saying during a September 17, 2002, speech given in Nashville, Tennessee. Mr. Bush said, Fool me once, shame onshame on you. Fool mecant get fooled again. Although the gaffe went down in history, the sentiment still holds true.

This idea of taking personal ownership when being fooled a second time by an untrustworthy person was first found in The Court and Character in King James written by Anthony Weldon in 1651. As the proverb stands, if you get fooled more than once, its totally your fault.

I thought this would be the perfect title for this book. Maybe you were deceived once, but the stories and lessons included in this book can help you never be fooled a second time. And if you do get fooled a second time, well it actually may be your fault.

INTRODUCTION

Kathe Swanson arrived at the Dixon, Illinois, city hall and entered the redbrick building through the side door, the same way she had for the last three decades. She looked younger than her sixty-two years, wearing her hair short and feathered. She was usually very busy, and today was no different.

As was often the case, her boss, Rita Crundwell, was away. Rita was Dixons city comptroller, but she was also a quarter-horse breeder with massive ranches in Dixon, Illinois, and Beloit, Wisconsin, eventually owning four hundred quarter horses on twenty-two farms across thirteen states. She had a $2.1 million motor home along with custom saddles, bedazzled riding jackets, and jewelry. She often took time off from work to do Lord knows whatsomething relating to horses. She had already won multiple national breeding championships. Kathe wasnt sure what went on at these shows, but she knew that they were expensive and that Rita lived for them.

People wondered aloud how Rita managed to afford all of this. Rita was never consistent with her responses. She told some people that her money came from selling horses and winning championships. Others believed that her parents were investors in the Campbells Soup Company. Still others thought shed had an older boyfriend who left her money after he died. Kathe didnt know and didnt care. It wasnt her business.

Today, Kathe had to pull together a fiscal report for a city council meeting. That in itself wasnt a problem. The issue was that Rita had never set up the user ID for the online banking system, so Kathe couldnt access the statements digitally, and the citys bank hadnt mailed the statements.

Rita had always instructed Kathe to gather information on specific accounts. But for some reason, today Kathe didnt feel like following protocol. Shes still not sure why. Maybe she was annoyed that her boss was out of the office yet again and that it fell on her to pick up the slack. Or maybe she was just listening to her gut. Whatever the case, she called the bank and asked them to fax over information on every single account for Dixon.

The pages arrivedreams of themand her eyes began to film over. Kathe wasnt quite sure what she was seeing, but something didnt smell right. She noticed deposits of $200,000, $300,000, and $500,000 into RSCDAReserve Fund, or Reserve Sewer Capital Development Account. Maybe it was a private account Rita had put under the citys name so she could buy and sell horses without the IRS catching on? But on closer inspection, Kathe realized she was wrong. This wasnt a city account. It was a private account. Ritas.

She didnt know it, but everything was about to change. For her. For Dixon. And for me.

Rita Crundwell had been tiptoeing, and then stomping, around my psyche since April 2012, when I opened the Chicago Tribune and a headline blasted out: Dixon Comptroller Accused of Stealing $30 Million from City Coffers. That was before they realized it was more like $53 million.

My heart jumped. How did a woman with a high school education pull off the largest city government fraud in US history? How did she steal over $37,000 a day from a town with an annual budget of $6 million? Rita was raised in Dixon, began working for the city right out of high school, and had no family wealth to speak of. How did her coworkers believe she financed such a luxurious lifestyle? And how did the citys auditor, a top-ten national accounting firm, miss all the evidence that fraud was occurring?

It was my kind of story.

Ive been fascinated with fraud ever since I was a graduate student at Virginia Tech, where I earned my PhD in accounting. Part of my interest had to do with my father, Dr. Tyronza R. Richmond. He was the chancellor of North Carolina Central University in Durham from 1986 until 1991, and he was forced to resign when one of his employees was caught embezzling money. My father had nothing to do with it, but he took the rap. The specter of that debacle loomed over him for the rest of his life. And, I guess, mine too.