Tardy Whistle-Blowers

Some important questions remain since Scott Mather, one of the most tireless advocates for the poor and homeless in Orange County, acknowledged that he defrauded at least five charities of more than $27,000 in phony insurance policies over the last five years. Mather, an independent insurance agent, repaid much of the money by taking out a second mortgage on his house.

The most intriguing question is, of course, why did Mather do it? For 15 years, he built a reputation as someone who cared deeply about the less fortunate in Orange County. He was instrumental in getting the county to open National Guard armories to the homeless during inclement weather and served on the boards or helped launch many agencies serving the needy. Mather said that he was under financial pressure because of an illness of one of his children and that he hoped to repay the money before it was missed. Clearly, that doesn’t justify acts that soiled his achievements and threatened to taint a cause that he said he was committed to help.

But there are other questions. For example, Anaheim Interfaith Shelter, which learned in October that the $5,000 it paid to Mather for liability insurance hadn’t been used to purchase a policy, notified its lawyer and sought new insurance but otherwise kept quiet. Instead of practicing damage control, why didn’t it alert authorities, who may have been able to inform other agencies that, as it turned out, were in the same boat?

There is also the larger question of what the agencies could have done to protect themselves in the first place. While no one is immune from being duped by a trusted friend, there are certain procedures that agencies can institute or reinforce to guard against being defrauded.

The most important is to exercise extreme caution in engaging in business with their board members. A volunteer for one victimized agency said having Mather handle the insurance was “so damned convenient. I can hear myself saying, ‘Let Scott take care of that.’ ”

State insurance authorities are investigating Mather. Because he is repaying the money, this may be an inexpensive lesson for the agencies. Better yet, the lesson might sink in and be spread around.