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Fraud – it’s not something we talk a lot about in the non-profit world or particularly the amateur sport community, but just because we do not talk about it does not mean it isn’t happening.

According to the Association of Certified Fraud Examiners (ACFE), 2020 Report to the Nations, organizations lose approximately 5% of their revenue to fraud each year.  Keep in mind the study covers, over 2,500 cases in 125 countries, with Canada and the US making up 46% of those cases.

More specifically, a report from The Philanthropist, in May 2009, said, “Smaller nonprofit organizations—those employing fewer than 50 people and/or having annual revenues of less than $100,000—experienced the greatest number of fraud cases and the highest losses relative to their annual revenue. Fraud losses for the smallest non-profit organizations—those with annual revenues less than $100,000—accounted for a median of 72% and a mean of 119% of annual revenue.[1]

Many of you may have seen Jamie Strashin’s report on CBC from November 2020, about fraud in non-profit sport in Canada. In his report, Jamie indicated that in Canada, approximately $8M had been lost in the sport sector in the last 10 years.  In my humble opinion, that may be a fraction of the loss experienced as many instances of fraud go unreported.

It can be a difficult decision to go public with organizational fraud, for a variety of reasons:

  • Acknowledging a lack of internal controls to stakeholders such as funders, government, donors, athletes, coaches, and parents
  • Backlash against perpetrator
  • Dealing with the emotional loss of being betrayed by a trusted colleague; someone who volunteered or who was hired in good faith to volunteer or work for the organization. Sometimes the betrayal is a greater loss than the actual financial loss. “How did I not know so-and-so was stealing from us?”

As Tiffany Couch, author of “The Thief in Your Company”[2], will tell you, it is very often the most liked and trusted person in the organization that commits the fraud.  It is directly because they are so trusted that they are given the access, passwords, roles, signing authority etc. they need to be able to commit fraud.  You would not give that type of access to someone you didn’t like or didn’t trust.

I have worked in the provincial government and non-profit sectors for over 30 years, and I have seen fraud at every level, from administrators/coordinators to Senior Management to Executive Directors to Board Members.  It is my belief that the non-profit sector, is at risk because we tend to be a well-intentioned, trusting bunch.  It is at our peril that we confer our values onto others as the evidence is clear, not everyone shares them.  As a result of those experiences, it has become my desire to help amateur sport organizations recognize the risk of fraud and assist in putting the processes in place to prevent and detect it.

If you’re interested in specific details on the characteristics of those who commit fraud, most common types of fraud committed, internal controls and the role of management and the board to prevent fraud, feel free to contact me at to learn more about scheduling a Fraud Prevention webinar.

For additional information, I would encourage you to revisit Rachel Corbett’s blog on this site entitled, Staying on the Lookout for Fraud – Some Risk Management Advice.  In it Rachel describes the fraud triangle, which describe the conditions or framework used to explain the reason behind an individual’s decision to commit fraud: Pressure, Opportunity and Rationalization.

In the meantime, be vigilant and remember, “trust is not an internal control”[3].

As part of your organization’s commitment to better manage risks, you may be interested in the 2-Day Risk Management Workshop (RMW), coordinated by the Canadian Centre for Ethics in Sport (CCES) and facilitated by Sport Law Team Member, Jason Robinson. The workshop provides sport organizations with actionable solutions to some of their most complex problems and uses a format that is adapted from the Australian/New Zealand risk management model and refined for the Canadian sport landscape.

Expressions of interest to take part in the upcoming Risk Management Workshops should be submitted to the CCES by August 14, 2023. You can learn more here.

Participating sport organizations also receive a customized risk registry that identifies and ranks their current risks, captures current strategies, and identifies potential solutions, which many NSOs/MSOs have since implemented as part of their reporting framework to funding partners. The CCES maintains a compilation of the risk registries as a resource for the sport community. More information can be found here.

[1] Qui Chen, Steven Salterio and Pamela Murphy, “Fraud in Canadian Nonprofit Organizations as Seen Through the Eyes of Canadian Newspapers, 1998 – 2008. May 2009, p. 1.
[2] Tiffany Couch, The Thief in Your Company, 2019, p. 36
[3] Tiffany Couch, The Thief in Your Company, 2019, p. 36