Manager and Board on the Hook for Poor Hiring Decision Leading to Embezzlement

By Michael Klazema on 7/31/2013

A civil grand jury has concluded that the poor management and lack of oversight displayed by leaders of the San Mateo County Mosquito and Vector Control District enabled two employees to steal nearly $800,000 from the county by embezzlement.

The employees in question, Jo Ann Dearman and Vika Sinipata, embezzled the funds between 2009 and 2011. Dearman, who was also known as Joanne Sweeney, served as the district's finance director and Sinipata assisted her as a bookkeeper. Together the two women used their positions to give themselves extra pay, take extra paid vacation, and make personal purchases using district credit cards. Both women pled no contest to felony embezzlement and other charges earlier this year.

The grand jury report concludes that the district's manager, Robert Gay, and its 21-member board should have discovered the fraudulent transactions much sooner and points to several flaws in their management and oversight processes that effectively gave their employees the opportunity to steal.

First of all, members of the board finance committee failed to detect discrepancies and red flags that should have alerted them to the possibility that embezzlement was occurring. Secondly, the board failed to heed the warnings of various senior district employees who attempted to bring financial irregularities to their attention. The embezzlement was not uncovered until a trustee finally began questioning the expenses that the district had been reporting during Dearman's tenure as finance director.

To make matters worse, an investigation by the insurance company covering the district revealed that Dearborn was hired without a background check, a fact which the insurance company used as proof that district officials had engaged in negligent hiring and should not be reimbursed for the embezzled funds.

Had the district run a background check on Dearman at the time she was hired, they would have learned that she was currently facing charges for allegedly embezzling funds from a previous employer. Dearman was ultimately convicted and actually used family medical leave to serve her jail time for this crime while working for the district.

This case clearly demonstrates the risks posed by failing to run background checks on prospective employees, especially when those employees will have access to company funds. The district could have implementeed a structured employee screening program for all new hire, combining a database driven national background check tool like US OneSEARCH from with function appropriate traditional on-premise criminal searches in county and federal courts. Federal violations like embezzlement generally will not appear in either a county or statewide criminal check and need to be searched seperately from a database or traditional criminal county search.

Jo Ann Dearman is known to have used the alias Joanne Sweeney, but that wouldn't have posed a problem for the district had they used a background check tool that includes a Social Security number trace to reveal known aliases like the US AliasSEARCH from

In response to the grand jury's report and the insurance company's claim denial, the district has begun implementing new steps to improve oversight of financial activities. It has also made background checks mandatory for all new hires.


Founded during the Internet boom in 1999 by an executive in both the staffing and information industry, – a founding member of the National Association of Professional Background Screeners (NAPBS®) – has been able to create a service that provides a blend of flexible screening programs that included instant, cost effective and comprehensive solutions. Our experience in database modeling of public records information has led to become the leader in the acquisition and delivery of public records information by harnessing the power and technology of the Internet. To learn more visit



Tag Cloud
Recent Posts

Latest News

  • March 15 As more states legalize the recreational use of cannabis, they contend with the emergence of new industries surrounding marijuana cultivation and production. 
  • March 14 In most cases, it is easy to determine where an issue might show up on a pre-employment background check. Citations for traffic violations or reckless driving charges will appear on a motor vehicle record check. Verdicts in a civil court case will show on a civil court background check. And criminal convictions—from petty theft to violent felonies—show up on criminal background checks.
  • March 13 How many years back do employment background checks go? This question can have multiple different answers depending on the situation.
  • March 13 A new bill in Florida would require landlords of apartment complexes to present tenants with verifications of employee background checks to give them peace of mind the people working in and around their homes are trustworthy.
  • March 08 Police officers working with the University of Texas at Arlington recently arrested a man who had avoided police capture on a warrant out of Oregon for nearly two decades. The man, whose real name is Daniel Charles Ray Hanson, spent those 17 years using a variety of fake names and identification documents to move around the country, often engaging with educational institutions under false pretenses. Police say Hanson regularly went by at least three different aliases. He sports a rap sheet that stretches back to an arson conviction in 1995. 
  • March 07

    The Future of EEOC Guidance in Texas Is Up in the Air

    The EEOC issued guidance in 2012 warning employers about the dangers of enforcing categorical policies to bar candidates with criminal histories. That guidance is not enforceable in Texas thanks to a recent court ruling.

  • March 05 Vermont is the latest state to restrict employers’ access to and use of social media accounts of employees and applicants. 
  • March 01 In an age of "industry disruptors" turning established business models on their heads, companies such as Uber and Lyft rely on a unique workforce of individuals outside the traditional employer-employee context. Uber calls them "partners" while other businesses refer to them as "independent contractors," the official classification these individuals use for tax purposes. Recently, the National Labor Relations Board (NLRB) revealed they had warned a business, Postmates, for misclassifying their staff as independent contractors. In the NLRB's determination, these individuals were employees.
  • February 27 Governor Asa Hutchinson signed House Bill 2216 which amends the employer’s directives regarding a current or prospective employee’s social media account.
  • February 23 A Texas summer camp is in the spotlight after an unflattering investigation from a local news channel. The case has some parents asking what they can do to vet summer camp programs before enrolling their kids.