By: Rob Harris
A lawsuit recently filed by Toronto’s York Downs Golf & Country Club against its former general manager should serve as a cautionary tale to the officers and directors of private clubs.
Here are the circumstances, as reported:
“York Downs’ is suing Leonardo De La Fuente, an employee for the past 11 years, seeking damages of $1 million, claiming he made false claims — assigning bills for work up to $200,000 on his own property and other items including riding lessons for his daughter and trips to West Palm Beach for his family — to the club.
“The statement of claim also suggests the Stouffville man used the company credit card for his own purposes, expensing food, vacations, clothing, club memberships, personal flights and accommodations.
“According to the documents, he was modifying and forging statements to remove his personal expenses, only to replace them with fictitious expenses attributed to the club.
“He then provided these statements to the York Downs staff, all of whom worked for him…”.
Apparently, the defalcation was discovered by accident, when a staff member opened a piece of mail that had been returned to the wrong address, only to find that the envelope contained a check “signed by De La Fuente and the club controller to an electrical company.”
Message to country club boards: trust but verify. There need to be financial controls in place to assure ongoing review of the financial transactions undertaken by club employees and officials at all levels.