Washington state crimes by the numbers
The former chief financial officer for Walton Beverage will spend time in jail for embezzling roughly $150,000 from the company over several years.
David Alan McLeod was sentenced Thursday, July 25, in Whatcom County Superior Court to eight months in jail, according to court records. Three months of McLeod’s sentence will be served in custody at the Whatcom County Jail, but the remaining five can be served on jail alternatives, according to Whatcom County Deputy Prosecuting Attorney Evan Jones.
McLeod also has to pay $150,000 in restitution to Walton Beverage, according to court records. He has already paid $110,000 of that, and will continue making payments on the remaining $40,000, Jones said.
McLeod was fired from Walton Beverage on Sept. 1, 2017, court records show.
Using Walton’s funds
In early September 2017, the chief executive officer for Walton Beverage reported ongoing theft by an employee to the Ferndale Police Department. The CEO told police McLeod had stolen between $25,000 and $35,000 of company funds over the past two or three years.
McLeod had been hired by Walton Beverage in 2012 to serve as the company’s chief financial officer. McLeod is a certified public accountant and was responsible for overseeing the company’s finances.
A second accountant was hired in October 2016 and noticed discrepancies in the company finances, according to court records. The accountant said the finances were poorly managed and had missing documents. When the accountant tried to address the concerns, McLeod “eventually ‘snapped’ at him and told him to stop asking questions,” according to court records.
Another employee also began to notice double charges against the company. The employee learned McLeod had an American Express card that was not authorized by the company and was solely in McLeod’s name. The card was being paid off monthly with company funds, court records state.
A review of financial records showed McLeod was using the unauthorized card to steal money from Walton Beverage. He would use the card to issue himself reimbursement checks disguised to look like he had paid a Walton Beverage supplier with his own personal funds. McLeod falsified American Express statements to justify the reimbursement. In total, more than $7,000 in falsified payments were recorded between 2016 and 2017, court records show.
McLeod also used the American Express card for personal expenses unrelated to company business. McLeod bought bags, jewelry, clothing, electronics, software programs and automotive and home repairs exceeding $15,000 between 2016 and 2017, court records state.
In late August 2017, Walton’s CEO met with then-CFO McLeod to discuss the discrepancies and placed him on administrative leave. McLeod did not confirm or deny wrongdoing but said that “there ‘may be a $2,000 computer mistake which he could correct,’” according to court records.
McLeod’s American Express credit card statements were obtained and showed that McLeod had used Walton Beverage funds for more than $40,000 worth of personal expenses, court records state. McLeod was then fired in early September 2017.
McLeod later sent an email to Walton’s CEO explaining the reimbursements and personal use expenses. In the email, McLeod said his actions were justified because he personally paid for business expenses, and that his alteration of financial documents was “certainly not [his] best judgment,’ but was not fraudulent,” according to court records.
Further investigation later revealed McLeod also stole more than $17,000 while selling the company’s vehicles. McLeod was in charge of managing the sale of the company’s fleet vehicles on consignment through Bellingham Automotive. Once Bellingham Automotive sold a vehicle, the money from the sale would be given to McLeod to be deposited into Walton’s accounts. The transactions would often involve cash, according to court records.
Between 2013 and 2017, there were at least six incidents identified where money for the vehicle sales was given to McLeod, but never deposited into Walton’s accounts, records show.
McLeod has no known prior criminal history, according to court records.