HOW TO STOP EMBEZZLEMENT – SIX RULES OF MONEY HANDLING FROM JAN
Rod – My niece’s husband is the operations pastor at a church and churches are susceptible to embezzlement also. The following are a set of procedures I suggested to him.
A simple management tool to avoid this is to separate the following:
1. Invoice review and approval,
2. Check signing,
3. Checkbook reconciliation.
Everyone has a checking account so the skills to do this are not rocket science. Also,
4. No family/relationship ties (incl in-laws, cousins, boyfriends, girlfriends….) among the 3 people chosen,
5. Require the bank to send the bank statement to someone other than the chosen 3,(this is where most embezzlements are discovered – the statement balance and the checking account balance do not match)
6. Adding a vendor to the system should only be done by someone not approving payments and not signing checks. (Eliminates fictitious vendors, and payment of personal expenses.) -Jan Bednarz.
Also “Your column is the one I read first. I was a commercial insurance agent for 40 years. You have given your readers excellent advice re: uninsured/underinsured motorist coverage. Enjoy your day.
Jan. Thank you for your wonderful insight and kind words about the column. I will make sure all money handlers in ABATE get a copy of this which I now call “Jan’s Financial Bible” or Rules of Money Handling According to Jan.
DO YOU DO MORE THAN MOTORCYCLE ACCIDENTS? BRENDA HALL
Q. I received a court paper about an auto accident I was in and not sure what to do next.
A. Yes we do. If you have been sued you need to send copies of the papers to your insurance company. If you have been subpoenaed as a witness you need to obey the subpoena. Call me if you need more. Ride safe. Rod
WHEN DO MOTORCYCLE TIRES AGE OUT?
Don’t you just hate throwing away tires that look tread perfect? I do. But here is the reason you should reconsider that saving attitude. The tire’s wear surface dries out, and when it comes to those attributes those cannot be safely resurrected. Most tire manufacturers try not to sell a tire that’s more than five years old. Rick Chupp of Cycle-Outfitters advises that the tires should be stored on carpet squares if the motorcycle is left in a garage with concrete floors. He advises that lye and calcium in the concrete have a deleterious effect on the tire. If the motorcycle is stored outside, then you have to inspect for ultra-violet ray damage. Per Rick, air pressure should be checked prior to each ride and a visual inspection of the sidewall and grooves between treads should be made. If you see any cracking, time to call Rick.
TURNIP BLOOD
Q. Rod, my friend was in a bad motorcycle accident last memorial day on Highway I- 65 just outside of Indy, he was sideswiped by a woman going in the same direction, causing him to lose control of his bike, he went down at 65 mph. His hospital stay was lengthy, and bills from that amounted to around $500,000.00. The woman that caused the accident only had state minimum insurance of $25,000.
After contacting a lawyer, my friend was told that suing the woman would be futile since you can’t get blood from a turnip. He is now stuck with the total amount of bills, with more coming from the radiologist, therapist etc. all the time. My question is, does he have an alternate way to get these bills off his back? Can he sue this woman, her insurance company? He has not signed off on any insurance. Steve – ABATE of Indiana member.
A. Steve. Sorry your friend is having these problems. Most people who carry minimal insurance limits do not have money or a way of paying for the damages they have caused that is why they chose the state minimum for insurance.. If your friend sues and gets a judgment, the debtor usually files bankruptcy, and garnishing poor people is usually pointless, unless they hit the lottery or inherit uncle Skeets farm. Your friend should investigate the assets of this lady before he signs a release and takes the limits if that is all there is. His lawyer will know how to do that search, if not have him call us. The internet is a good cheap tool for that investigation. Hate to spend lots on a full blown asset investigation when it is obvious from the signs there is no money to be had other than the insurance limits, but always be on the lookout for the cheap skate farmer with lots of hidden dough. Hate to use the “B” word – bankruptcy, but your friend should look into all of his options. He may be able to negotiate a minimal amount of payment on the hospital bills and avoid “B”. Ride safe, Rod.
LADY GODIVA MAY BE MORE THAN YOU BARGAINED FOR
Q. My local motorcycle group is having a costume party on our property, and we have some concerns about what might happen at the party. Last year, we had a great party, and some of the guests decided they would dress like Lady Godiva. Some of the neighbors complained, but nothing came of it. This year, I have heard that the neighbors have already notified the police, and I expect that they might show up. The major concerns I have are: what gives the police the authority to come on my property, and what would happen if they found some of the (dressed like Lady Godiva and drunk) guests were under 18? ABATE OF ILLINOIS members.
A. Big problems can happen – that’s what. Minors should never be present for illegal activity so you need to put on your big Saint hat. Let’s deal with the questions in the order you asked them. If a neighbor calls the police because of a breach of the peace, such as loud music, people running around naked in public view, then the police responding to the call may be justified in entering the property. They call that probable cause. If, however, there is no visible evidence of violations (everyone is inside being quiet and the shades are pulled), then the officers would need a search warrant to enter the property based on probable cause. And always use waivers and check ID’s. I remember a case involving a pro-football player who held a graduation party. Many of the kids were underaged. The prosecutor chose to make a big deal out of the party when it was alleged some of the kids got into the liquor cabinet. You don’t want to be in those shoes if one of those kids imbibes alcohol and has a crash on the way home. And you don’t want a prosecutor pointing a finger at you – ever.
PROVING THE VALUE OF YOUR CUSTOM BIKE TO THE INSURANCE GUYS
Q. I have a bike that I bought stock five years ago and have made a number of improvements to it including a lot of chrome, custom paint, and other customized equipment. My bike was stolen last month, and the insurance company only wants to offer me book value for the bike. By my estimation, it’s worth about twice the book value of a stock bike. Is there any way I can convince the insurance company to re-evaluate their offer?
A. There may be a way to do that, but good records of what you have done, and photos help immensely to prove the value of your bike. Most insurance policies cover customization and items added to bikes, but the insurance company has to be assured that the customizations that you claim you added were actually added to the bike and became a part of the bike. There are a number of ways to do that. The easiest and best way is to document all the customizations done to the bike. This means keeping meticulous records of the modifications done to the bike, who did them, when they were done, how much they cost, and what effect those customizations had on the value of the bike. You may want to ask your dealer for a written opinion that confirms the value increase. Send all of the photos and documentation to your insurance representative – before your bike gets stolen, of course.
Let’s assume you did a custom job with three distinct components: First, you did some body work – you put on a new fork, new handlebars, and new wheels. You did that during the course of one season and didn’t plan on doing any more work that season. It would be a good idea once that work was completed, to take pictures of the bike, put those together with all the receipts from the work done to the bike and send copies of that information to your insurance company. At that point you should get an appraisal for the bike. Often, appraisers work at a motorcycle shop or dealer. You especially want an appraisal if the value of the bike together with the additions is more than what you paid for the bike plus the value of the additions. For example, you bought the bike for $5,000.00; you added $5,000.00 worth of additions, but those additions and your sweat equity caused the bike to be worth $15,000.00 rather than just the value of the bike plus the parts, which was $10,000.00. An appraisal will prove to the insurance company that the bike is worth more than the sum of its parts.
Now let’s assume it’s the next season, and you have added a lot of chrome to the bike. Again, you should take pictures of the bike, keep copies of the receipts, describe the work done, and submit that info to the insurance company for their files. Suppose later on you decided to complete the customization and get a special paint job on it. Once that work is finished, you need an appraisal of the value of the bike to show the insurance company what it’s worth with all the customizations. With those documents, you will be in a good position to prove the value of the bike to the insurance company should you need to make a claim.
Remember, some insurance companies offer special guaranteed amount coverage for customizations or for bikes with historic or antique value. If your bike has value for collectors beyond the book value for a stock bike, check with your insurance agent about modifying your insurance to make sure your investment is covered. Never forget that with insurance companies, if it is not in writing it doesn’t count. Get email addresses of your insurance company reps and make book on them, because they are making book on you. Meaning, you should confirm every conversation and send them every doc and photo you have. If that doesn’t work, call us.
AM I PUTTING MYSELF “IN HOT WATER?”
Q. I have been an ABATE member since the 70’s and I am a member of an MC, my 17 year old son has been brought up around the club and wishes to start entering the ranks as a hang around. My question is since he’s under age, could I be charged with contributing to a minor or endangerment of a minor, just because he’s with me? ABATE MEMBER
A. Good question. Yes, and see above Q&A regarding the Godiva party. If there are activities in his presence that are illegal for the underaged he needs to go visit grandparents. Obviously drinking and smoking cigarettes by adults are the exception.