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	Police: Exec Stole $1m from Churches By P.J. Reilly Lancaster Online March 14, 2008 http://articles.lancasteronline.com/local/4/218180 Dauphin County authorities Thursday arrested an East Lampeter Township man for allegedly stealing more than $1 million from hundreds of area churches. Lower Paxton Township police said Barry R. Herr, 61, of 2119 Creek Hill Road, allegedly stole the money over the past 17 years while working as treasurer for the Harrisburg-based Lower Susquehanna Synod, Evangelical Lutheran Church in America. The synod is composed of 261 churches in Adams, Cumberland, Dauphin, Fulton, Franklin, Lebanon, Lancaster, Perry and York counties, including Lutheran Church of the Good Shepherd on Greenfield Road, where Herr is a member. Herr used the stolen money primarily to buy "expensive luxury, foreign vehicles," Lower Paxton police Lt. David Hogentogler said. "He bought several of them over the years. Harrisburg District Judge Joseph Lindsey arraigned Herr on Thursday on 36 counts of using a computer to illegally transfer funds and one count of theft by deception and released him on $25,000 bail. Herr's co-workers at the synod, where he was treasurer for the past 28 years, and his neighbors said they were stunned by his arrest. "I'm speechless. I'm totally shocked," said Janet Shenk, who lives across the street from Herr. Georgia Martin, who lives next door to Shenk, said she knew Herr only as "a very cordial person to say 'hi' to." Martin said she never noticed that Herr had a collection of luxury cars. "But I'm not too observant about those things, either," she said. Barb Myers, director of communications for the synod, said she "knew Barry loved cars, but I didn't know he collected them." Myers said Herr drove a BMW to work. Knowing that news about Herr's arrest would attract media attention, synod Bishop B. Penrose Hoover sent letters Thursday to leaders of the synod's various churches. "This shocking and tragic event saddens us all and touches the lives of all who are part of the gospel ministry we share in the Lower Susquehanna Synod and the church at large," he wrote. Herr did not return a reporter's phone call for comment Thursday. ••• According to a timeline prepared by the synod, organization leaders began to learn about Herr's alleged illegal activities last spring, when they were studying the possibility of providing synod-owned vehicles to the bishop and assistants to the bishop. The leaders discovered that Herr had been taking "as part of his regular compensation" payments from the synod for gas and insurance for his personal vehicle — benefits not afforded to synod officials. Last June — the same month in which he was elected by the synod to serve another four years as treasurer — Herr was placed on a paid administrative leave while an audit of the synod's finances was conducted. A month later, Herr was fired because "the synod council indicated at that time that it had lost confidence in Mr. Herr's competence and judgment and believed his dismissal was necessary to create transparency and accountability in the office of the treasurer," according to a synod statement. In August, interim financial managers hired to take over Herr's duties discovered $325,000 was missing. The money was supposed to have moved via three checks from the synod's endowment fund to the national office of Evangelical Lutheran Church in America for distribution. According to Myers, the money was supposed to be used to buy food for children in Africa and to fuel a "discretionary fund" that's tapped for emergencies, such as the destruction by fire of a church pastor's home, and to pay medical costs for retired pastors. The synod's legal counsel traced the checks to an account that only Herr had access to. ••• Synod leaders took the matter to Lower Paxton police in November, and detectives discovered that the account had been opened in 1985 under the name "Cardinal Investment Fund." The account was closed in October. Police also learned that Herr had been been depositing endowment funds into this account over the years and transferring some money from it to his personal accounts. A statement from the synod indicated that "evidence of wrongdoing" by Herr spanned from 1991 through October. "One thing we want to make clear is that we are fairly certain that Mr. Herr only took endowment funds," Myers said. "He was not taking money that church members were offering for collections in church each week." Synod finances are regularly audit ed, Myers said, but those reviews never detected any missing money because Herr was the only one who knew payments were coming in from endowment funds. Since 1938, the Lower Susquehanna Synod has been receiving endowments, primarily through the wills of deceased members, Myers said. Herr didn't siphon all the endowment payments, Myers said, so some funds were reaching the national office of Evangelical Lutheran Church in America for distribution. "Nobody knew there was more money that wasn't making it (to the office)," she said. ••• Last month, Lower Paxton police, with assistance from East Lampeter police, searched Herr's Creek Hill Road home and seized computers and boxes of financial records, according to Hogentogler. That's when police discovered Herr had allegedly been using the stolen money to buy "collectible" cars, which he apparently fixed up and sold, Hogentogler said. At the time police searched Herr's home, Hogentogler said, Herr only had three cars there, none of which was seized by police. Hogentogler could not identify the type or value of any of the cars Herr is alleged to have bought over the years with the stolen synod funds. "All I can say is some of them were pretty expensive," he said. According to Myers, the synod already has implemented some new practices to prevent fund thefts. One such practice requires more than one signature to pay out money from endowment funds. Other "checks and balances" are expected, Myers said. The synod also is working with its insurance carrier to recoup from Herr the money he allegedly stole. "We have an obligation to make sure those funds are used for their intended purposes," she said. Documents and other information related to the alleged crime can be found at www.lss-elca.org. E-mail: preilly@lnpnews.com
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