Kimball Allen, who was hired by the association in 2008, sent the association an apology letter through the Palo Alto police department on March 17 for the theft, which took place throughout 2010, according to association President Sean Giffen.
Details of Allen's expenditures on the association's credit card emerged at a March 22 community meeting regarding the theft. The charges included a $5,000 air-conditioning system for a rental home he owns in Kansas City, Mo.; a hair-replacement surgery; membership to a high-end fitness club; trips; and paying off his credit cards, Giffen said Wednesday (March 23).
In his letter to the association, Allen acknowledged, "The crimes that I have committed are pathetic and hurtful" and asked members to keep an "open mind."
"I got caught up in a vicious cycle of greed, selfishness and deceit," Allen wrote in the letter, which was obtained by the Weekly. "My actions cannot be justified and the worst punishment is my own guilt."
Allen resigned his position on Dec. 30, 2010, to start a new gym, but he stayed on through January 2011 to train his replacement, Donna Rhoan. It was she who quickly discovered that something was amiss.
Rhoan told the Weekly that Allen held on to his administrative access until Jan. 31, his final day at the association, and spent much of that day cleaning up the data on the association's computer.
She said Allen told her just before leaving that he had ordered checks and equipment. When the items didn't arrive, Rhoan said she e-mailed Allen on Feb. 3 to ask about them. He responded about a week later with a brief e-mail that she described as "snappy" and that didn't provide the information she was seeking.
In another case, Rhoan said she asked Allen about two payments that he signed off on to a new bank. Allen said he made an error.
Rhoan said she also noticed that many of his reported expenses were based on estimates rather than invoices. This included estimates for fitness equipment and for a sand-filtration system meant for a giant swimming pool.
Another red flag was raised when the association received a letter from a bank acknowledging the association's change of address for mailed statements. The fact that the association never requested an address change made her suspicious, Rhoan said.
Rhoan said she alerted the association's board of directors about the financial irregularities just after she noticed them. Association officials initially thought the damage was limited to $5,000 or $7,500, she said, but they soon found other examples of inaccurate accounting.
"Once we found one error, we began looking through everything," Rhoan said.
In 2009, the association's credit card spending totaled about $20,000, but in 2010, that sum ballooned to $90,000, Giffen said.
The discovery began with "a few items of a questionable nature," including a $500 charge to Walgreens, he said.
"There were no records or details of the credit-card bills. Once we were able to get the credit-card statements, the majority of the expenditures were of a personal nature, and we contacted the police," he said.
Allen voluntarily came to the police department for questioning, but he was not arrested, Giffen said. The association provided police with "an enormous amount of detail" regarding the embezzlement, he said. No charges have yet been filed.
Residents expressed shock and disappointment regarding the theft, but most were supportive of the association's efforts, he said.
"We are all sad and disappointed about this turn of events, but Greenmeadow has always pulled together to solve problems. I have no doubt we'll get through this just fine," Penny Ellson said.
"There was a consensus that he is responsible and shouldn't walk away from this. We're looking at options to recoup the money. We hope to recover the loss. We'll see what the District Attorney has to say about potential restitution," Giffen said. It is also possible that restitution could be made through the credit-card company, he said.
Giffen said he attempted to contact Allen a number of times and was never successful.
"His behavior after leaving Greenmeadow indicated that he had almost no concept that he had done anything wrong," he said.
Allen expressed remorse in his letter to the association and pledged to take "full responsibility."
"Words cannot express to you how remorseful I am," he wrote. "I plan on taking the appropriate legal and emotional steps in resolving the damage that I have done."
Meanwhile, the association's finance committee is looking at available technology to provide transparency in bookkeeping. Other members at Tuesday's meeting offered ideas on policy and practices that could help prevent future thefts, Giffen said.
"The community really came together. ... It's moments like this that define a community. Does it tear you apart or bring you together?" Giffen said.