The financial services industry was the most frequent victim andexperienced the greatest losses from major embezzlement schemeslast year, and nearly one in four involved credit unions, accordingto the 2012 Marquet Report on Embezzlement that was releasedTuesday.

The report, which analyzed 528 major embezzlement cases in whichat least $100,000 was misappropriated, found that 15% (about 80cases) involved financial services firms but did not includeinsurance-related entities. Of that 15%, according to the report,23% (about 18 cases) involved credit unions.

In 2011, only eight of the 58 financial services embezzlementcases involved credit unions.

“The financial institutions are always at the top of thelist in terms of both the frequency of embezzlement cases and thevolume of losses, and credit unions in particular seem to be hardhit,” said the report's author Christopher Marquet, founder ofMarquet International Ltd., a Wellesley, Mass.,investigative, litigation support and due diligence firm.

Marquet's report said the 2012 fraud cases involving creditunions probably resulted from “their relatively less-stringentcontrol structure than commercial banks and other financialinstitutions.”

For example, the report highlights the case of Sharon Broadwayof Toledo, who had been employed as the “manager, secretary, boardmember and sole employee” of the United Catholic Credit Union in Temperance, Mich.

She was able to siphon a total of $2.1 million for more than 20years. Michigan prosecutors said Broadway managed to conceal hercrimes through a complex money-laundering scheme involving forgedchecks and multiple aliases.

The credit union was shuttered last year, and Broadway wassentenced to 20 years in prison in January.

“This case illustrates that when you have what appears to bezero business controls, you are inviting trouble,” the reportreads. “We note that the Broadway case in only one in six thatexceeded 20 years in duration.”

In addition to Broadway's case, Credit Union Timesreported on four other multimillion dollar fraud and embezzlementcases in 2012 including:

• Ignacio Morales, former CEO of the $7 million Borinquen FCU,pled guilty to embezzling $2.3 million and causing the Philadelphiafinancial institution to collapse.
• Theresa “Teri” Portillo, former manager of the shuttered $2million Women's Southwest FCU, who pleaded guilty to stealing $3.4million from the Dallas-based credit union.
• William Liddle, former business lending vice president of AEAFCU in Yuma, Ariz., and his wife Rhonda Liddle, were found guiltyof participating in a business loan kickback scheme. They wereordered to pay more than $25 million in restitution.
• Michael Ross Franco, a former loan officer for My Community FCUin Midland, Texas, who pled guilty for defrauding the cooperativeout of $4 million in an auto loan kickback scam.

Though tough economic conditions can drive people to steal, theMarquet Report's data suggest that the primary motivating factorfor perpetrators of major long-term embezzlement is to obtain andmaintain a lifestyle far grander than what they would otherwise beable to attain.

“In many cases, the thefts actually began in good economictimes, while they continued over many years,” the report said.

“We have also noted that during boom years, embezzlement caneasily go unnoticed since the victim organization may be makinghealthy profits and the perpetrator begins by taking relativelysmall, regular amounts that fall under the radar,” the report said.“Many embezzlers accelerate their theft over time, leading to ahigher probability of getting caught.”

Second to the financial services industry, government agenciesand municipalities accounted for 11% of embezzlement cases lastyear and 9% involved other non-profit organizations. Health care,professional services, real estate and religious entities combinedfor 22% of embezzlement cases last year.

The report also found that 58% of embezzlement incidentsinvolved women. Men embezzlers, however, stole nearly three timesas much as women. More than 67% of embezzlers held a bookkeeping orfinance position.

The most common embezzlement scheme involved forged orunauthorized company checks, while in nearly 33 % of the cases theembezzlers reportedly had a gambling issue, according to thereport.