Lawsuit: Former Builders' Exchange employees stole more than $1.2 million
| Friday, Oct 09 2009 11:00 PM
Last Updated Friday, Oct 09 2009 11:00 PM
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As a police investigation continues, the Kern County Builders' Exchange has sued its former executive director and others alleging they stole or benefited from stealing more than $1.2 million from the nonprofit over at least the past five years.
The lawsuit alleges former Executive Director Philip Field plus his daughter and Exchange office manager Darlene Ocampo embezzled by doing such things as obtaining fraudulent reimbursements for expenses, writing checks drawn on the Exchange's accounts and making false entries in business records.
The civil complaint, filed in Kern County Superior Court, also says the Exchange has spent no less than $20,000 on a forensic audit to identify exactly how much money was taken.
"Field and Ocampo fraudulently manipulated the books and records to make unearned payments of cash to themselves, to pay off their personal credit card debts, to pay their entire family's cell phone bills, to pay for cosmetic medical procedures, to pay for their and their family members' personal travel, to pay for vehicles and upgrades to the vehicles, to pay for their and their family members' mortgages and construction upgrades to their homes," the suit alleges.
Field's attorney, Benjamin Gluck, said he doesn't believe his client has been served and this could be just a placeholder lawsuit to preserve the Exchange's rights to sue under the statute of limitations. Gluck said it's his understanding an audit is still under way.
"Mr. Field has worked for the Builders' Exchange for decades, he dedicated himself to building it and put his own time and money into it," Gluck said. "We're confident that in the end the audit is going to show he did nothing wrong."
The lawyer representing Ocampo, Pete Murray, said he was "blind-sided" by news of the lawsuit Friday and hadn't had a chance to sit down and examine the details. He, too, was still waiting on audit results.
"There are far-reaching, broad allegations," he said of what's in the suit, "I'm quite confident many of which will fail when properly explored."
Exchange attorney Dennis Thelen said the alleged stealing was discovered about 45 days ago, after a suspicious staff member suggested to Exchange leadership that an audit be done.
"There were very substantial accounting problems discovered that would suggest, in an overwhelming fashion, that people in a position of trust we believe have embezzled from the Builders' Exchange," Thelen said.
Asked why these alleged problems did not surface sooner, Thelen said that like many nonprofit and profit organizations, the Exchange has not been contracting with a CPA to do audits.
He said Bakersfield City Councilman Ken Weir, an accountant, was only asked to do what's commonly requested: to look at the format of information submitted to him and say "yea or nay if the format of the balance sheet is accurate."
"He only did what he was asked to do," he said.
Asked about the situation, Weir sent The Californian excerpts from a letter he received from Thelen that in part said: "Based on our investigation thus far, we certainly would not have expected Mr. Weir to catch internal problems that would only have been discovered reasonably through an audit and we certainly do not expect to find additional information, as further investigation takes place, which would implicate Mr. Weir in anything that would be considered immoral, unethical, or illegal."
The Exchange is a nonprofit association of general contractors, subcontractors, engineers, architects, manufacturers, suppliers and others in the construction industry, according to its Web site.
Its purpose is to "enhance professionalism and educate its members" and provide "programs, facilities, equipment and supplies for use by its members for a fee," according to its 2008 nonprofit tax filing.
The filing shows Builders' Exchange had net assets of $1.74 million at the end of the year.
The lawsuit says Field and Ocampo's spending benefitted others, who are also named as defendants: Stephen R. Ocampo, Darlene Ocampo's husband; Linda J. Graves, who is also Field's daughter; and Graves' husband, Charles J. Graves.
A phone message and written note left at what records showed to be the Graves' home Friday generated no response by Friday evening.
None of the money taken by Field and Darlene Ocampo has been returned to the Exchange, filings say.
All of the defendants are also accused of conspiracy.
The suit seeks no less than $1.2 million, interest, money spent recovering the funds, attorney fees and other damages.
The case is also being investigated by the Bakersfield Police Department. Investigators are waiting for an audit commissioned by the Exchange, Detective Mary DeGeare said Friday.
The lawsuit gets specific as to who allegedly did what with Exchange money.
It says expenditures included, but weren't limited to, at least $70,000 on a mortgage for the residence owned by the Ocampos; at least $40,000 for the purchase -- and at least $18,000 for the remodel -- of the residence owned by the Graves; car payments of at least $35,000 and at least $25,000 in vehicle upgrades and accessories received by the Ocampos; and hundreds of thousands of dollars to purchase personal property for the Ocampos and Field.
