One man’s 11 cents on corporate wrongdoings

All these big corporate bankruptcies and all the cooked books

remind me of when I was almost charged with embezzlement. My victim:

the city of Newport Beach.

It was during the Depression, when cities were going belly up

almost as often as today’s corporations. Newport Beach kept afloat in

large part because of income from the Police Department and city

court. Balboa could be guaranteed to furnish 50 to 75 drunks to the

city jail on a busy Saturday night. At $20 a drunk, that was big

money for those days.

As city judge, my job was to pick up the money from the Police

Department every morning and carry it to the courtroom in the old

City Hall. This being the Depression, there were nickels, dimes and

pennies, as well as folding money. I diligently counted the money,

entered the total into the ledger, then carried the money across the

hall to Jim Gant, our city treasurer.

Now math was never one of my strong points. After years of trying,

unsuccessfully, to reconcile my checking account with the bank’s

records, I simply accepted the bank’s statement, and that is the way

I handled the city’s money. I did my best to get an accurate count,

and then handed it on to Jim.

Then the independent auditor arrived to go through the city’s

books. The auditor was a man everyone called Robbie, short for

Robinson or Robertson. He was nice, polite and smiled a lot as he sat

there day after day, going through the Police Department records and

my records, making little check marks with a red pencil.

Finally, the audit was over. Robbie came to me. He was no longer

smiling. “Bob, the books don’t balance.”

That didn’t surprise me. “How much are they off?” I asked, curious

as to how close I got to the right amount.

“Eleven cents.”

A year of receipts, and I’m off 11 cents? “That’s great! That’s

closer than I have ever come on my checking account.”

Robbie wasn’t impressed with close. “Bob, you are short 11 cents.

You have 11 cents of the city’s money that doesn’t belong to you.

That’s embezzlement.”

Embezzlement? My career flashed before my eyes. Disbarment loomed.

“What can I do?” I cried.

“Pay off the amount you’ve embezzled.”

I raced across the hall and paid Jim Gant the 11 cents, got a

receipt and raced back and handed it to Robbie. He entered a check

mark in his books, smiled again, and the ordeal was over.

If we had more auditors like Robbie, we wouldn’t be having the

financial scandals we’ve seen lately. And maybe some of the corporate

officers involved in those scandals should pay the money back, just

like a certain judge did all those years ago. Of course, I realize

it’s quite a bit more than 11 cents.

* ROBERT GARDNER is a Corona del Mar resident and a former judge.

His column runs Tuesdays.