mr. speaker , i rise today to express my sincere disappointment in the committee on rules decision to report a restrictive rule for consideration of the bill before us today , the reauthorization of head start , the future of our children . 
several commonsense amendments were not ruled in order . 
not surprising , most of them were democratic amendments . 
instead , several amendments that were ruled in order will weaken head start and the opportunity for our children . 
in the committee , there was support of adding the language `` faith-based '' into the bill , even though faith-based institutions currently participate in providing head start programs . 
we were happy to do this in committee ; i was also , along with my colleagues , because the equal opportunity employment act is also spelled out clearly in the bill , which does not allow for discrimination in hiring . 
but there was another amendment that was not ruled in order , my amendment , an amendment which would have protected the privacy of our faith-based organizations and the integrity of our tax dollars . 
the amendment that i offered in the committee on rules would have simply required faith-based organizations to create a separate bank account , a separate bank account in which to receive federal dollars for the head start program , a distinct and separate bank account from the private dollars that a religious organization collects to put forward their religious mission . 
why do we need to do that ? 
well , first , we need to protect federal tax dollars from being used improperly ; and , secondly , we need to protect the privacy of faith-based organizations ' accounting books for their religious mission . 
with the commingling of funds , if fraud is suspected , a faith-based organization would have to open up all of their books for inspection . 
my amendment would have required separate accounts , therefore , protecting the church 's mission and the federal education mission of head start . 
mr. speaker , let me quote from the covenant companion , a christian publication . 
i quote from this publication , and i will also include this in the record , as well as two other publications that speak to this . 
from the covenant : `` churches are particularly vulnerable to embezzlement because of the high-level of trust given to employees and volunteers that lack the sophistication , fiscal controls , and oversight. '' my amendment simply would have been a preemptive strike against financial abuse that we know will happen because it has already occurred . 
for example , this past summer , $ 80 , 000 was stolen from a federal head start program run by a church . 
mr. speaker , i urge my colleagues to reject this rule . 
we need a new rule , one that will protect the taxpayers , one that will protect faith-based organizations and stop discrimination . 
when the numbers do n't add up sandra had a problem -- an overdue visa bill for $ 672 and no cash to pay it . 
and the visa bill was n't the only problem . 
sandra was behind on a number of other bills and her creditors were calling . 
and calling . 
then sandra , the bookkeeper at a small manufacturing company in kansas , came up with a desperate plan . 
she would use one of the company 's checks to pay her bill . 
`` i thought , just this one time , just to get back on my feet , '' she told fortune small business ( fsb ) magazine . 
`` no one will know. '' to disguise her actions , sandra recorded the check under the name of one of the company 's vendors . 
when the bank statement came , she removed the canceled check , leaving no trace of the theft . 
but it was n't just one time . 
from 1992 to 1999 , sandra , a former small town cheerleader and mother of two , wrote out eighty-eight checks to pay her bills and made eighty-eight false entries . 
the total , according to fsb , was $ 248 , 383 -- all of it going to pay living expenses . 
since her employers at the small , family-run business trusted her , they never checked her work . 
the embezzlement was discovered when sandra went on vacation . 
while she was gone , one of the canceled checks was found and her boss discovered what she had done . 
sandra was convicted of embezzlement and sentenced to eighteen months in prison . 
while fraud at major companies like world com and enron have made headlines in recent years , small businesses , nonprofits , and churches arc particularly vulnerable to embezzlement because of the level of trust given to employees and volunteers and the lack of sophisticated financial controls and oversight . 
in the past three years , guideone , which insures 45 , 000 churches in the united states , paid 3 , 845 claims to churches for losses from theft ( by people outside the church ) or embezzlement ( by people inside the church ) . 
those claims total over $ 8 million , with an average claim of $ 2 , 106 . 
in the past ten years , at least eleven covenant churches have reported being victims of embezzlement , with anywhere from `` just over '' $ 10 , 000 to more than $ 300 , 000 taken by people they trusted -- volunteer treasurers , church staff , even a pastor . 
at least one major embezzlement at a covenant church was discovered in 2002 . 
and the actual number of embezzlements is likely higher because many churches are reluctant to report when a member of the church has embezzled money . 
kent egging , interim pastor of bethany covenant church in mount vernon , washington , has studied embezzlement in churches as part of a doctor of ministry degree program . 
egging also knows the effects of embezzlement on a church firsthand -- while he was co-pastor of a covenant church in portland , oregon , the church 's treasurer embezzled more than $ 45 , 000 . 
the embezzlement began in 1992 , soon after jim , a member of the church , became treasurer . 
his main qualification , egging says , was not formal training in business or accounting -- '' he was willing to do the job. '' soon after starting , jim learned that the church had a separate account to handle funds for a campaign to build a christian education ( ce ) wing . 
since the funds were not needed immediately , there seemed to be no need to closely monitor the account . 
that separate account gave jim two things that an embezzler needs to succeed -- access and no accountability . 
`` he found he could transfer funds into this ce account and then withdraw them , '' says egging , `` and absolutely nobody knew. '' the transfers were made by phone , leaving no paper trail , and then the treasurer would create a false financial statement , which made it appear that the transactions had never taken place . 
`` when the building committee began asking for access to the ce funds , they had a hard time getting jim to write them a check . 
in april 1993 , he admitted -- at first -- taking $ 20 , 000 . 
after learning about the embezzlement , the church discussed whether or not to call the police . 
in the process , egging talked with a friend who worked in the local district attorney 's office . 
`` you call the police now , '' his friend told him . 
`` you call them now . 
here 's what i can tell you -- if he says it 's twenty , it 's probably forty . 
if he says he 'll do anything you want right now to repay it , two months from now he wo n't be willing to do anything. '' much of what egging 's friend said was accurate . 
a thorough investigation revealed that $ 45 , 000 was missing . 
while the church filed a police report , they did not press charges . 
instead , they reached a binding agreement with their former treasurer to repay the money . 
`` we ended up having a stipulated statement of judgment , '' says egging , `` which is a combination of a legally binding confession to a crime , so there is no need for prosecution , and a contract for repayment. '' the agreement for repayment was for about $ 50 , 000 . 
the church only received about $ 300 . 
restoring trust after an embezzlement at a church is a long process . 
the first step is getting an accurate picture of what was lost . 
`` it was very important for us to do a proper accounting , '' says egging . 
`` the biggest issue in all of this is trust , the violation of trust . 
it 's not about the money so much . 
it 's about the trust . 
he violated our trust . 
the trust of leaders in the congregation was in question because of this. '' to prevent any embezzlement from happening in the future , the church revamped its entire financial system . 
they hired a cpa to set up and monitor new accounting procedures . 
the church changed its bank accounts so that telephone transfers were no longer allowed . 
all financial statements were kept at the church , and all accounting work was done on the church 's office computer rather than on a volunteer 's home computer . 
that 's an area of vulnerability in most churches , says egging . 
`` i would bet that most churches in america have some or a significant number of financial records at somebody 's house in a box or on somebody 's home computer , '' he says , `` because home computers are generally better than church computers . 
a church wants to make it easy for a volunteer who 's working on church finances. '' embezzlement can happen even when a church has taken steps to prevent financial losses . 
that was the case at highland covenant church in bellevue , washington , during the mid-1990s . 
the church had a number of common financial safeguards in place -- two signatures were required on every check , two people were present whenever collections were counted , and the church did an internal audit of its book each year . 
highland also practiced a `` segregation of duties. '' one person , the financial secretary , deposited funds ; another person , the bookkeeper , prepared checks . 
neither the bookkeeper nor the financial secretary was allowed to sign checks . 
for the most part , beth , the church 's bookkeeper , generated highland 's checks on her computer . 
`` but every few months , she would call up and say her printer was n't working , '' says dave kersten , who was pastor of highland covenant from 1986 to 1997 . 
when this happened , beth would prepare all of the payroll checks by hand and then send them to the church office to be signed . 
after they were signed , she would alter the checks , adding just a single digit to increase the amount , sometimes by several thousand dollars . 
`` she would write herself a check and her husband a check , because he was the part-time janitor , '' says kersten . 
`` instead of it being a check for $ 700 -- it could become a check for $ 4 , 700. '' over a seven-year period , beth took more than $ 300 , 000 . 
the embezzlement was not detected because the church 's bookkeeper had control of the bank statements . 
early on , she had asked that all of the church 's bank statement be sent to her home . 
`` and in a very trusting environment , '' says kersten , `` that was the big mistake. '' when the first altered check was discovered , kersten called the bellevue police and spoke to a fraud detective . 
`` as soon as he heard that she had control of the bank statements , he knew that he had a real case , '' kersten says . 
`` invariably , when an organization allows a person who is writing the checks to control the bank statements , they are very vulnerable. '' while the church 's financial reports indicated that it had money in savings and other discretionary funds , that proved to be false as well . 
all of those funds had been folded into the church 's checking account . 
and because the embezzlement had taken place slowly , over a long period of time , it was easier to hide even during internal audits . 
each year , two members were appointed to audit the books . 
they would call up beth and ask her to send 3 months of statements , picked at random . 
`` she would pick months she did n't embezzle any funds and send them those accounts , '' says kersten . 
`` the books balanced and that was the end of the story. '' the embezzlement came to light in april 1995 , after the church let beth go as bookkeeper because of suspicions that something was wrong with the church 's finances . 
she was arrested , tried , convicted , and sentenced to 40 months in jail . 
the decision to turn the matter over to the police had been fairly straightforward , because of the amount of money involved . 
because their policy limited the amount of losses due to embezzlement or fraud , highland received less than $ 20 , 000 from their insurance company . 
but the church was able to recover from the embezzlement , and by the time kersten left in 1997 , had rebuilt their savings and completed a major fundraising campaign . 
most churches , charities , and businesses that arc victims of embezzlement are never able to recover the funds they lost . 
often their insurance policies have clauses that limit liability due to fraud . 
many embezzlers have financial problems and , despite stealing large sums of money , have no assets left when they arc caught . 
and while embezzlers often make restitution plans , it is difficult to enforce them . 
remember sandra , the accountant from kansas ? 
she was released from prison 2 months early so she could start repaying what she stole . 
according to fsb , she makes a monthly payment of $ 100 -- at that rate , it will take 20 years to pay it all back . 
she said she told her story because she wanted to help prevent other people from making the same mistakes she did . 
`` i 'm not a bad person , '' sandra told fsb . 
`` but i did a really bad thing. '' protecting your ministry from internal threats when fred meyers was elected treasurer of first community church , it did n't take him long to realize something was n't adding up with the church 's finances . 
after scouring the church ledger and consulting a private cpa , meyers informed church leaders that first community had been the victim of embezzlement . 
church leaders soon discovered that , over the past several years , an usher had been directing offering money into his own pockets . 
overall , nearly $ 10 , 000 of tithes and offerings never made it into the church 's account . 
in the business world , embezzlement is the most common financial crime in the nation . 
unfortunately , it 's also a frequent crime against churches and not-for-profit ministries . 
and , unlike other crimes against religious organizations , embezzlement is perpetrated by a trusted person from within . 
most church leaders do n't want to acknowledge the likelihood of one of their own parishioners or employees committing a crime against their organization . 
but , although these types of crimes may not be widespread , they are common enough-and costly enough-to warrant preventive measures . 
develop a comprehensive written policy governing the handling of your ministry 's finances . 
this policy should clearly spell out the procedures for handling church finances , making deposits and withdrawals from church accounts , accessing financial records , and conducting other financial business . 
having procedures in writing and explaining these procedures to employees and volunteers will promote consistent handling of your organization 's finances . 
written guidelines let everyone know what 's expected of them . 
and , they discourage dishonest employees from using ignorance of proper procedures as a defense of their criminal actions . 
in addition to a written policy for handling finances , it 's helpful to have written position descriptions for all employees and volunteers . 
position descriptions can eliminate confusion over who has access to certain financial documents and who 's authorized to perform certain financial functions . 
document all financial transactions clearly and immediately . 
record deposits , withdrawals , loan payments , payroll , and any other financial transactions . 
keep these records ( and duplicates , if necessary ) in a safe place . 
by documenting all financial procedures , your organization can detect discrepancies quickly , protect honest employees from unwarranted accusations , and gather necessary evidence to identify criminals in the event of a financial crime . 
implement a program for documenting suspicious financial incidents . 
in many cases , at least one other employee or volunteer is aware of -- or at least suspicious of -- fraud or embezzlement . 
making it easy and safe for employees and volunteers to report suspicious financial activity will make it more likely that they 'll come forward with helpful information . 
develop a program for handling church finances in which the receipt , deposit , distribution , and documentation of church money is carried out by different people . 
require dual signatures for financial transactions like withdrawals or for endorsing and cashing church checks for more than a certain dollar amount . 
if control over financial operations is divided among several people , it will be extremely difficult for discrepancies to go undetected . 
tithes and offerings represent the greatest internal threat of loss to churches and ministries . 
and , because significant portions of offerings are made in cash and are usually collected and counted by volunteers , the misuse or misappropriation of cash offerings is one of the easier crimes to commit against churches . 
to protect your church 's offerings , follow these steps : ask your congregants to place financial gifts in envelopes preprinted with their names and addresses before placing them in the offering plate . 
this will make it harder to discern what portion of the offering is cash and what portion is checks . 
always have at least two people present when counting the offering . 
it 's best to use longtime church members who 've established a reputation of being trustworthy . 
develop a list of such people , and periodically rotate those on the list when offerings are counted . 
also , avoid counting the offering behind closed doors . 
stamp checks `` for deposit only '' when endorsing them . 
this will make it more difficult for the money to be redirected anywhere except to your church 's account . 
also , using colored ink , rather than black ink , on rubber stamp images makes it harder to use a copy machine to forge them . 
have an independent certified public accountant ( cpa ) periodically review your financial control procedures . 
a cpa can tell you whether your procedures are adequate and give you additional guidelines to help you protect your finances from threats from within . 
in addition to financial assets , physical property is a favorite target for criminals within an organization . 
follow these tips to protect your property : use a safe for petty cash , small valuables , keys , and important documents . 
keep important financial records and personnel documents in a safe or a locked filing cabinet . 
only a few necessary staff members should have access to the key or combination . 
establish a key monitoring system . 
use keys with serial numbers on them to keep track of which employee or volunteer has which key . 
avoid keeping spare keys . 
if they 're necessary , keep them locked in a secure place . 
collect keys from employees or volunteers who leave the organization . 
keep interior office , classroom , and supply room doors locked when not in use . 
give master keys only to those people who need them . 
if someone only needs a key to get into a classroom , that person may not also need a key that opens the church office . 
control access to security codes . 
if your church or ministry has a security system , be sure that only a few necessary staff members know the codes . 
additionally , it 's a good idea to occasionally change codes or passwords . 
be sure to change the codes whenever anyone with access to them leaves the organization . 
keep a personal property inventory of your organization 's physical property . 
this will help you quickly tell if something is missing , establish proper insurance protection , and allow a faster , more comprehensive recovery in the event of a loss . 
taking steps to prevent internal crime is just as important as guarding against threats from the outside . 
following these guidelines will help you reduce the chance of being victimized from within and help you avoid the high physical , emotional , and monetary costs it can bring . 
