Manager steals $70K from neighborhood group

Kimball Allen, former Greenmeadow Community Association administrative manager, admits and apologizes for crime

The former manager of a south Palo Alto neighborhood association has admitted to embezzling tens of thousands of dollars from the group before leaving his position in late January to found a new gym.

Kimball Allen, who resigned as the administrative manager of the Greenmeadow Community Association on Dec. 30, 2010, allegedly used the association's credit card to make personal purchases and then made bogus entries into the association's accounting software to cover up his spending, according to an e-mail the association sent to the community this weekend.

The association estimates that Allen, who was hired in August 2008, embezzled about $70,000.

Allen stayed on through January 2011 to help find and train his replacement and left the association to open a gym in Redwood City, according to the Greenmeadow website. Last Thursday (March 17), he sent a letter to the association acknowledging that "the crimes that I have committed are pathetic and hurtful" and asking members to keep an "open mind."

"I got caught up in a vicious cycle of greed, selfishness and deceit," Kimball wrote in the letter, which was obtained by the Weekly. "My actions cannot be justified and the worst punishment is my own guilt."

Donna Rhoan, who succeeded Allen at the association, was the first person who noticed 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.

Allen could not be reached for comment and did not respond to an e-mail request for interview sent to his gym, ACRO Gymnastics Academy. The phone number listed on the gym's website did not appear to be working Monday.

According to an e-mail that Sean Giffen, president of the Greenmeadow Community Association, sent to association members over the weekend, Allen used the association's credit card to make unauthorized expenditures and then entered "illegitimate entries" for expenses into the association's accounting software to cover the spending.

Giffen told the Weekly the case is still being investigated by the police and declined to provide further details about the embezzlement.

A Palo Alto police spokesperson confirmed Monday that the investigation is ongoing and also declined to comment.

Giffen said he plans to discuss the incident with the Greenmeadow community at a Tuesday night meeting and declined to elaborate "out of respect to the community."

In his e-mail to association members, Giffen said Allen "has admitted to using Greenmeadow funds for personal use" and said the association estimates the embezzled sum to be at about $70,000.

"Illegitimate entries for expenses were being entered into Quickbooks to cover the spending," Giffen wrote in the e-mail.

He said the association would discuss the case Tuesday and inform the community about opportunities to recover the embezzled funds and the steps the board has taken to prevent future embezzlement.

"Our ability to pull together and work through difficult times is awesome," Giffen wrote. "The 2011 board, members from the 2010 board and our finance committee have worked tirelessly in addressing this matter and ensuring that we follow a process moving forward that will minimize financial risk."

Allen began working as the association's administrative manager in August 2008. Giffen announced Allen's resignation on the association's website on Dec. 30, 2010, and called Allen "an asset to our community." He also notified the community about Allen's new gymnastics facility and said Allen "credits the growth he experienced with us to help prepare him for his new endeavor."

Rhoan said Allen's departure wasn't a major surprise to most people. He was known to have other interests, particularly fitness, and it was common knowledge around the association that he would not be staying long term.

Allen, meanwhile, 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 want you to know that I plan on taking full responsibility for my wrong doings and I plan on taking the appropriate legal and emotional steps in resolving the damage that I have done."

Bounded by Alma Street and Charleston Road, the Greenmeadow neighborhood is composed of 22 blocks and about 270 homes. As part of the development, built by Joseph Eichler, the neighborhood contains a community center, swimming pool and park.

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Like this comment
Posted by Hulkamania
a resident of Duveneck/St. Francis
on Mar 21, 2011 at 6:14 pm

Another great example of why two signatures are required on any check over $400.

Like this comment
Posted by Member
a resident of Greenmeadow
on Mar 21, 2011 at 7:27 pm

I think that use of the new Greenmeadow Administrative Manager as a source for the article is poor reporting, and puts the new manager is an awkward position of having to answer to the wrong doings of her predesessor. If your article is to report about a crime, the Greenmeadow Community Board presisent has already announced that to its members. It seems like you are creating a circus exhibit here.

Like this comment
Posted by Oh Please
a resident of Another Palo Alto neighborhood
on Mar 21, 2011 at 8:00 pm

Sociopathic behavior like this needs to be brought to light. Thank you for reporting it. [Portion removed by Palo Alto Online staff.]

Like this comment
Posted by who is he
a resident of Adobe-Meadow
on Mar 22, 2011 at 8:37 am

How about a photo of the perp?

Like this comment
Posted by kellyxf
a resident of University South
on Mar 22, 2011 at 11:28 am

"ACRO Gymnastics Academy", the name alone sounds like a perfect setup for his new scam, a new gym with an old world name such as "Academy".
Personally I don't believe he should be aloud to have a business dealing with an unsuspecting public ever!!

Person note: "Gwp-ch", a major rudeness peeve, calling out that "typo", that is something you should private message directly to the writer, did you spend the hours on research and investigation on this article?? Apologize in a private message maybe?? "Gwp-ch"

Like this comment
Posted by Steve C
a resident of Menlo Park
on Mar 22, 2011 at 12:42 pm

This happens more often than people realize, especially in businesses and organizations where the bookkeeper or business manager has sole control over the books. I have a close friend whose design/build business was ruined by a crooked manager. My friend was very good and too busy doing what he did best, designing and building. That's why he hired a manger to handle the other stuff. Once these crooks realize they can get away with the small stuff, they can't resist going after the big money.
Part of how this was done was by pulling checks out of the back of the check book, out of sequence, then fudging the books to look like legitimate bills were being paid. It only came to light when the crook resigned and his wife had to take over the books at tax time. They were always running low on funds in spite of a booming business, and couldn't figure out why. Because he had a solid reputation and track record, this went on for some time. But once one creditor called in an account that had not been paid, like dominoes, all suppliers jumped on the bandwagon, and my friend could no longer operate. It put him out of business, and even though they got some of the funds back, there was not enough to cover the losses. Twenty or more skilled workers lost their jobs, a high-end cabinet shop had to be sold. It's tragic. This was a well known builder in Maine. The homes he designed and built are second to none, each unique. He now works for his former primary competitor.
This creep manager was paying his mortgage, renting cars for his wife, you name it. He died not too long after he was charged. Left a trail of wreck and ruin.
NEVER trust anyone to manage your financial affairs, without another qualified person reviewing the books, and the accounts that are supposedly being paid.

Like this comment
Posted by Jason
a resident of Barron Park
on Mar 22, 2011 at 1:18 pm

Greenmeadow is a horribly managed community. The fact that this could go on for so long without anyone noticing is ridiculous. [Portion removed by Palo Alto Online staff.]

Like this comment
Posted by Resident
a resident of Greenmeadow
on Mar 22, 2011 at 1:31 pm

Kimall had most of the residents in Greenmeadow thinking that he was doing an exemplary job. He was charming, friendly, intelligent, and supposedly hard-working. Little did we know that he was embezzling from the community. Obviously, there is some work that needs to be done to make sure this never happens again. I know that the residents of Greenmeadow will pull together, make the necessary changes that need to be made, and move on.

Like this comment
Posted by GM Associate Member
a resident of Greenmeadow
on Mar 22, 2011 at 1:36 pm

To Jason,

You comment is not appropriate. The borad and presidency rotate and our current president just started recently (one or two months) and was one of those that found it. Kimball had been working since Aug. 2008 under several presidents and boards. He apparently only started stealing in the past 9 - 12 months. As Steve C. said it started small. The bulk only happened recently.

GM Associate Member.

Like this comment
Posted by Palo Alto native
a resident of Charleston Meadows
on Mar 22, 2011 at 2:43 pm

This behavior is unacceptable and it's unfortunate that this happened.

Like this comment
Posted by Derrick
a resident of Evergreen Park
on Mar 22, 2011 at 3:54 pm

Wasn't this guy ever audited? This neighborhood assn. must have gobs of money to be missing that much and no one ever noticed until he left.

Like this comment
Posted by Resident
a resident of Another Palo Alto neighborhood
on Mar 22, 2011 at 4:24 pm

How did he stockpile the money? Why were people paying him? Our neighborhood has an annual party and asks for money to participate and I've noticed that the kitty has depleted considerable from thousands to hundreds in a short time. This should be a warning to neighborhoods to not engage. Neighborhood parties should be potluck.

Like this comment
Posted by Larry the cable guy
a resident of Esther Clark Park
on Mar 22, 2011 at 6:36 pm

"Manager steals $70K from neighborhood group" ? Really? No trial. Not even an arrest. But the Weakly says he's guilty based on emails. Wow! We don't need a legal system with judges, lawyers, juries and all of that stuff when the Weakly can declare who is guilty or innocent.

Like this comment
Posted by come on Larry
a resident of College Terrace
on Mar 22, 2011 at 7:02 pm

The guy confessed to embezzlement. He deserves to be treated like he is telling the truth.

Like this comment
Posted by changeup
a resident of Another Palo Alto neighborhood
on Mar 22, 2011 at 9:50 pm

Many good points which I hope the GMCA and other community organizations learn from; they must be set up like business' with Employee Handbook and Job Descriptions. Two signatures at the minimum by the President and VP of the Board; plus another Board Member to reconcile the Transaction Journal and Bank Statements monthly.

As far as the embezzler; his actions should be investigated while he is under a court ordered arrest, just like anyone else would be, except for the Bankers, Investment Company Execs on the East Coast and the crooks in Corporations, Insurance and Real Estate who created the world's financial disaster of 2008. It doesn't matter if he wrote a "nice" email trying to exonerate himself. Who is he kidding? The least he could do is return all the equipment he bought, sell what he can't return; give the proceeds to the GMCA and then wear an ankle bracelet with a tagging system, get a job and pay back the GMCA every single dime plus 7% interest for as long as it takes. Sounds far to me; otherwise he is put into jail where we have to pay for his time and the GMCA gets nothing!

Like this comment
Posted by will the punishment fit the crime?
a resident of Palo Verde
on Mar 22, 2011 at 11:00 pm

While he may well be sorry and has written that "the worst punishment is my own guilt", what he is admitting to is a serious crime and was a pattern, not an impulsive, one-time act.

I cannot help but think that whatever his sentence, it will be easier than that for an inner city kid caught stealing a $70k car.

Hey, white collar crime seems to work for Wall Street!

Like this comment
Posted by Stunned
a resident of Greenmeadow
on Mar 23, 2011 at 8:45 am

A previous poster described Mr. Allen’s behavior as sociopathic, and after last night’s Greenmeadow neighborhood briefing, I have to agree. As if the numerous counts of felony embezzlement weren’t enough, he weaseled his way into many people’s lives and homes, tossing off lie after lie – making it clear that he has zero regard (possibly even contempt) for those around him. [Portion removed by Palo Alto Online staff.]

Like this comment
Posted by bea
a resident of Leland Manor/Garland Drive
on Mar 23, 2011 at 11:15 am

[Post removed by Palo Alto Online staff.]

Like this comment
Posted by Barron Parker
a resident of Barron Park
on Mar 23, 2011 at 11:46 am

A long-term pattern of embezzlement, carefully structured to avoid detection, is typical of psychopaths.

They are usually charming, friendly, verbally clever, masters at lying, manipulative, and they invariably leave a trail of ruin and pain behind them.

[Portion removed by Palo Alto Online staff.]

Like this comment
Posted by member
a resident of Greenmeadow
on Mar 23, 2011 at 5:15 pm

[Post removed by Palo Alto Online staff.]

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Posted by Resident
a resident of Greenmeadow
on Mar 23, 2011 at 6:26 pm

Dear Member, Kimball's actions speak loudly and clearly. They are not the actions of someone who genuinely cares about the members of this community. On the contrary, his actions have blind-sided and hurt many community members. While the financial hurt is there, the deeper wound is the fact that this community trusted and valued him as an employee, and as a friend. Greenmeadow is an amazing place, and we will get through this as we work together and move forward.

Like this comment
Posted by Anonymous
a resident of Another Palo Alto neighborhood
on Mar 23, 2011 at 10:15 pm

With such a weak accounting system and the lack of audits, the Greenmeadow Community Association got the administrator they deserved. Hopefully, the board will insist on better accountability and safeguards.

Like this comment
Posted by Inside Job
a resident of Crescent Park
on Mar 24, 2011 at 10:28 am

Financial work in the US these days seems like a license to steal. I doubt he will get a "long enough" jail sentence or learn from the experience. He'll just get "promoted" into something bigger.

How is it that we produce so many dishonest people lacking any care of bond to their communities?

Like this comment
Posted by Palo Parent
a resident of Greenmeadow
on Mar 24, 2011 at 10:32 am

It is important to note that in part, due to websites like this one, he's pretty much screwed if future employers ever Google his name before hiring him.

Like this comment
Posted by Observer
a resident of South of Midtown
on Mar 24, 2011 at 1:13 pm

Anonymous, No, the Community Association does not deserve this. Green Meadow is run by volunteers, who work very hard to make it the wonderful organization it is. Yes, this has uncovered a weakness in the accounting practice, which is being addressed. What would be tragic would be for the community to become less open and welcoming, and for the members to be reduced to blaming, name calling, finger pointing - well, your post is a good example.

Like this comment
Posted by Resident
a resident of Greenmeadow
on Mar 24, 2011 at 3:43 pm

Thank you Observer! Your post is much appreciated!

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