Unravelling high rates of white-collar crime in the Okanagan

Two months ago, former office administrator Melanie Gray was sentencedto five months in jail for stealing nearly $70,000 from Kelowna's Central Okanagan Hospice Association.

Gray, who was the officeadministrator at the hospice association,was accused of stealing the money between 2013 and 2015, using the hospice's company credit card.

Her case is just one of many fraud cases in the area. In 2017, there were more than 1,200 incidents of fraud in the Okanagan. The region often associated with wineries and beautiful sceneryis alsoa hotbed for white-collar crime.

According to the latest numbers from Statistics Canada, in 2017, the rate of fraud in some Okanagan cities wasnearly double the national average.

The average fraud rate for most regionsof Canada is about 300 incidents per 100,000 people, but in Penticton the rate is 461, in Kelowna 592, and in Vernon 706 incidents per 100,000 people.

Prevalence of fraud

Const.Ann Donnelly, Kelowna RCMP's lead fraud investigator, said she couldn't point to a reason why fraud levels are so high in the area, but she has learned you can't trust anyone.

"A lot of times the people who are committing these internal type of frauds and thefts are super well liked. They're your best friend. You trust them implicitly and that's the downfall," Donnelly told Daybreak South host Chris Walker.

In Kelowna, theCentral Okanagan Hospice Association, which Gray was convicted of stealing from, is contending with another fraud case.

Its former executive director, Susan Steen, hasbeen charged with fraud and theft for allegedly stealing more than $100,000 on the hospice association'scredit card.

The associationprovides palliative care programs in Kelowna.

Steen's case is still before the courts, because she was sentenced to jail after pleading guilty to stealingclose to $6,000 from the Nanaimo Community Hospice Society.

Her next court appearance for the Okanagan case is on May 31.

High fraud rates

There have been other fraud cases in B.C.'s Southern Interior.

Youth social workerRobert Riley Saunders faces civil claimsalleging he pocketed the benefits of young people in his care, and last year, theowner of a hockey schoolin Penticton, pleaded guilty to theft over $5.000.

Glen Jackson, a chartered professional accountant with a certification in financial forensics, thinksthe high rate of fraud is a reflection of the economy in the Okanagan, where there is a higher percentage of small businesses, which he said may be more susceptible to fraud.

Small businesses usually start with one person, Jackson said, who may havea lot of control. But asthe business grows, the owner has to hire more people, losing a degree of oversight.

"You start to have to begin to trust other people, and those people, typically a bookkeeper who has a propensity to commit fraud, is able to take over and put themselves forth as someone who is trustworthy, someone who can help them manage their business, but internal control gets lost at that point, because there's no oversight of the person, the fraud perpetrator."

Notgreed alone

Forensic accountantMarilyn Mellis, said it's too simplistic to suggest the motivation for fraud is greed alone. Rather, it's a desire among people to accumulate the material belongings they see others possessing, the classic impetus behind "Keeping up with the Jones."

"For lots of people, it isn't that they're greedy, it's that they see 'Okay my neighbor has a boat, and I would like a boat. I can't afford a boat.'

"So, the things start welling up in your mind and you start thinking, 'OkayI really need this thing. I want to be like my peers. They all have boats or whatever the thing is. And it starts to consume you," Mellis said.

Sticky Fingers: Fraud in the Okanagan is a series that looks at white-collar crime in B.C.'s Southern Interior. It's produced by Chris Walker and Christine Coulter and airs on CBC Radio One's Daybreak South from May 6-10.