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'Major fraud' uncovered at Red Deer Golf and Country Club

Members of the Red Deer Golf and Country Club have learned that a former employee is accused of removing nearly $1 million from its bank accounts over several years.

Members of the Red Deer Golf and Country Club have learned that a former employee is accused of removing nearly $1 million from its bank accounts over several years.

In a letter dated Jan. 6 and mailed to members with the club’s annual report, board president Merv Thurmeier said accountants uncovered a “major fraud” during preparation of its 2010 financial statements.

Further investigation revealed misappropriation of funds in 2009 as well, and it is now believed the incidents of fraud go back as far as 2007.

In notes to the 2010 financial statements, the annual report states losses of $425,200 in 2010, $315,005 in 2009, $153,330 in 2008 and $23,500 in 2007, for a total of $917,035 over four years.

The unnamed employee is alleged to have admitted using a series of falsified cheques to steal the money. The employee was dismissed Nov. 29, Thurmeier writes in his letter. A legal agreement was struck, enabling the club to recover $225,000.

While details of the agreement cannot be discussed, there is a possibility that more of the missing money can be recovered, Thurmeier says in the letter.

“These matters are ongoing and will not be concluded before our (annual general meeting on Monday). Thus, we cannot provide details,” he says.

Thurmeier told the Advocate on Tuesday that the impact of the loss on the club will be “little or none.”

“We’re a very healthy club, financially, and we’ll be able to overcome this with little or no difficulty.”

Kathe DeHeer, media liaison officer for Red Deer City RCMP, said police have not been involved in the investigation.

“We have not been contacted by the golf course to do any investigation,” DeHeer said on Tuesday.

“I have no idea why they haven’t reported it to us,” she said.

Thurmeier said he would not comment on why the police had not been called.

In his Jan. 6 letter, Thurmeier says “rumours and unsubstantiated accusations” have being passing among the club’s membership. But the board of directors could not address those rumours until it had reviewed its financial statements, which were delivered late on the evening of Jan. 5.

“It is therefore only at this time that we are in a position to provide full details of the fraud and what has been done, and what is continuing to be done to gain a measure of restitution,” he wrote in the letter.

Thurmeier’s address in the annual report states that internal procedures and controls have been adjusted to deter and prevent future frauds. Members are to hear those details during the golf club’s upcoming annual general meeting.

Finance and capital planning chair Larry Owen, in his contribution to the annual report, writes that revenues for the golf club fell below budget for 2010, leaving almost no provision for capital spending in 2011.

The “saddest” impact from the alleged fraud was its effect on trust, says Owen’s report.

“It makes one question people they have known and trusted for a very long time just because they are in a position of trust,” he writes.

“We will get past this and continue the tradition of having a fine facility where people gather to enjoy the great game of golf.”

The Red Deer Advocate has held a share in the Red Deer Golf and Country Club for decades.

bkossowan@www.reddeeradvocate.com