October 26th, 2009
Legion of Tech falls victim to embezzlement
To be blunt, this sucks. I can’t tell you how much I didn’t want to write this. But it’s news that affects the Portland tech community, and as such, I felt an obligation to cover it. Long story short, you deserve to know.
Deep breath. Here it is:
Portland-based Legion of Tech—the organization formed to help manage events like Ignite Portland and BarCamp Portland—has revealed that a member of the organization has misappropriated the Legion of Tech credit line for personal use.
Shock doesn’t even begin to describe my reaction.
A few hours ago, I sat down with two board members of the Legion of Tech. They detailed the entire scenario for me. I’ve still got a knot in the pit of my stomach.
I regret to inform you that the Legion of Tech Board of Directors (”Board”) recently discovered that a previous board member had taken money from the organization. That person spent thousands of dollars on personal expenses using a credit card that the Board was unaware carried a balance. That card was connected to a bank account that the former director was to have closed months ago. The account remained open and the former director wrote personal checks from the money in the account–money that was to have been transferred to the new bank account upon its close.
Upon learning of this fraud, the Board acted swiftly to hold an emergency board meeting. Actions were taken to freeze both accounts and the individual was removed from the Board.
The LoT has retained legal counsel to help them determine next steps in the proceedings.
How could something like this happen? Fact of the matter is that the organization was prone to this this type of activity due to admittedly lackadaisical accounting practices. Obviously, that doesn’t speak to the reasons it happened. But it did provide the wherewithal for the embezzlement to occur.
For more information on the incident, read this Legion of Tech post.
Being painfully open about the incident
Now by all rights, Legion of Tech could have simply remained silent about this incident. So why did they come forward and release this information?
The members to whom I spoke felt an obligation to come forward and to be forthright and as transparent as they could about the incident. They felt an obligation to the Portland tech community. And they felt that members of that community had the right to know what was going on.
Legion of Tech has always been about the community. And this is just the latest—albeit sad—instance to prove that.
What’s more, the remaining members—who could have easily washed their hands of the situation and walked away—have chosen to remain on board to fix it. And to ensure that the Legion of Tech resolves this issue.
And yes, to answer the question hanging out there, Ignite Portland 7 will still go on.
Where do we go from here?
No doubt, this is something which will not only shake the foundation of the Portland tech community—something for which the Legion of Tech has been seen as a de facto ombudsman—but will also likely send ripples through the Ignite community, given that the LoT-managed Ignite Portland is one of the more successful Ignites around.
As for me, I’ve got any number of angles that tie me to this story, both personally and professionally. Silicon Florist is a regular sponsor of Legion of Tech events, I serve on the Advisory Board for Legion of Tech, and I count the members of Legion of Tech among my friends.
And this revelation hurts on all counts. And I, like you, feel betrayed. And more than a bit confused. It’s just, well, surreal.
This is horrible news. And it’s a horrible thing to happen to people whom I know and respect. But, in all honesty, my real concern is that this whole thing could hurt the entire Portland tech community. And that’s much more of a concern to me.
The Legion of Tech has served an incredibly important role in the formation of this burgeoning Portland tech community. And LoT—much like CubeSpace—has been a key component of helping the Portland tech community to grow and prosper. And, well, become a community.
And now, the Legion of Tech will suffer a lack of trust. And likely some definitive retribution.
And that, in turn, will hurt the community, undermine it, and potentially destroy it.
But I sincerely hope it doesn’t.
I think it’s important to remember that this was the act of one individual. The organization is dealing with the situation in the best way they know how. They’re getting assistance. And in an effort to prevent something like this from happening again, they’re making their accounting practices more rigorous.
They’ve learned a lesson. And maybe—just maybe—it’s a lesson that will serve to inform any number of handshake-and-friendship startups in here in town.
Maybe now is the time to make your practices more formal. To protect you, your family, your friends, and your business partners. Hopefully, you’ll never find yourself in a similar situation, but if you should, you’ll be better prepared to deal with it. Because trust only goes so far.
Right now, I’m saddened and, admittedly, in shock. But I know one thing for sure. I know that I will continue to support the remaining members of the Legion of Tech as best I can. And hope that there is a quick and permanent resolution to this incident. For the sake of all of those involved.
And for the sake of the community.