At Little League® International Headquarters and in our Regional Offices, calls and emails come in all year long about situations that are happening at one of our 7,000 local leagues. Many of these calls and emails inform us of some very positive initiatives spearheaded by our millions of volunteers. However, there are also negative situations. As a new section within Little League’s Notebook newsletter, “Don’t Let This Happen to Your League” will detail a real world scenario, how it has impacted a league, and how you might learn from it.
The names have been changed in the following scenario, but the situation is real.
A local league was planning for the upcoming season when one of their suppliers wouldn’t fulfill a uniform order because they hadn’t been paid for the past two years. Members of the Board of Directors started looking into the books, noticed discrepancies, and contacted authorities. The two signees on their bank accounts were a husband and wife, who served as the league’s Treasurer and President, respectively. The police found that over the decades he had been a volunteer at the league, the Treasurer had embezzled hundreds of thousands of dollars.
Because the league did not have crime insurance, the league is now working hard to raise the money needed to ensure the children in the community have a great Little League season. The President and Treasurer were forced to resign and are now facing felony charges. The local media picked up the story, and the league is working on regaining the trust of the parents in the community.
One thing that Little League discourages is having two related people be the ones responsible for a league’s finances. The two designated signees should have no personal connection outside of the league. Leagues should also do regular audits, either internally with the help of a volunteer at the league with a financial background, or professionally by a Certified Public Accountant. At a minimum, audits should be done yearly, but even doing monthly audits can help make sure your league’s finances are being managed appropriately.
Make the audit part of the responsibilities of the Finance Committee on your Board. The Finance Committee should be made up of three to five people, and does not include the league Treasurer. The Committee is responsible for investigating the ways and means of financing your league, including team sponsorships, taking up collections at games, and ensuring the league has the money needed to operate.
We also would urge leagues to determine if the crime insurance that Little League provides would help protect their league. The crime insurance policy available through Little League protects the league against monetary loss caused by dishonesty, disappearance of money, securities or other property, and destruction of money or securities.