Non-Profit exec explains personal charges on corporate credit card

WILMINGTON, NC (WWAY) -- Family groceries: $394

Stogies from the cigar shop: $20

A new policy to stop inappropriate credit card use by a local non-profit: priceless to a Wilmington City Council Member.

Councilwoman Laura Padgett called out some questionable credit card purchases by Downtonwn Wilmington, Inc. The organization receives tens of thousands of dollars each year in funding from the city and county. WDI executive director, John Hinnant, admits he used WDI's credit card to buy groceries at Wal-Mart, then cigars from a tobacco shop, plus more charges. 2 months later he reimbursed the non-profit.

Hinnant explained to WWAY he went shopping the day after pay day back in April, and didn't realize that the funds were not yet available in his checking account. "I was in a bind. I had groceries, we had family coming in town for the Easter holiday, we had a grocery cart full of groceries and a line 20 deep. I was in a bind and the only thing I could recall was that it had previously happened in the organization. And after a short conversation with my wife we figured it wasn't a big deal, we'd use the company card and we'd reimburse the organization."

Later that day, Hinnant bought cigars for the men in his family on the corporate card. Hinnant says his decision was regrettable, but at the time, there was no policy against using the company card for personal expenses.

There is now. Anyone at WDI caught using the corporate card for personal expenses in the future will be disciplined by the executive board, up to and including termination.

J. Wesley Casteen, a local CPA we consulted, said while it's not ideal, there are some businesses where employees frequently use the corporate card for personal expenses, and then reimburse the company. He said the biggest problem that creates for a non-profit is not a legal one, but the appearance to the public. From an accounting perspective, it does add an extra step to the bookkeeping, and there's also the risk of oversight, if the employee forgets to reimburse the company.

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Seems the City Council is withholding funding until an audit is completed and reviewed. First by WDI Board of Directors and then by the City Council.

And when the topic of funding for the buses to carry folks to the Eagle came up for discussion, it nearly sank. Seems Council Members had some concerns if the funds would be given to WDI for payment to the bus vendors. The funding was only approved with the stipulation the City would pay the funds directly to the bus vendors.

Mr. Hinnant, can you say "Lack of Confidence" in leadership?

You might want to start putting some resumes out. Not certain what your chances are?

But, the CEO of Hewlett Packard resigned due to some lapses in leadership and failure to set a high standard of performance.

In this economy, with the Feds reporting a net loss of 171,000 jobs in July after the trillions spent on job creation and economic stimulus, using a "company" credit card for stogies and groceries sent the wrong message.

With cities and counties cutting budgets and eliminating programs to make ends meet, the City has no choice but to look at the performance of the WDI & the value added to the city by its performance. That points straight at you.

With such a tight budget, why are taxpayer funds going to Downtown Wilmington Inc. in the first place?

Maybe it should be "no big deal" that he is terminated for malfeasance in his position. This is a serious ethics violation. A line 20 deep in Walmart...I haven't seen one no where near that deep in my many visits there!!

Hinnant, WDI Executive Director nor his wife had their own credit cards nor the cash available to pay for groceries? Yea, sure.

No matter what the explanation, in my opinion, the man should be fired. His actions are the same as stealing from the company.

What about milage benefits earned through the use of a corporate card. Should it go to the employee or signed over to the company?

His pay check had not cleared and the funds were not available in the account.

So he uses the corporate credit card for personal items including groceries.

Why did it take 2 months for him to repay? One would have thought he could have repaid the following week on his return to the Office after the Easter break.

There is the concern. Effectively, he had a 2 month interest free loan. Did the entity incur interest charges on the account as a result of the charges?

Very Poor Leadership displayed here.

I feel the major issue, is that it wasnt re-paid immediately, which leads me to believe that he was ONLY planning to pay the "loan" back if it was discovered by others. The excuse that there was no policy against using the card for personal use in place is a joke. Does there really need to be a rule that states you should not steal money from your non-profit? Hinnant is the "face" of the downtown revitalization, and this type of behavior CAN NOT be tolerated. He needs to be removed from his position and be held accountable for his actions.

disagree with your position he must go or must publicly apologize; but in the absence of a policy prohibiting the useage for private purposes, there was no crime.

Extremely poor leadership that it took 2 months for him to repay.

Perhaps he does need a more stern lesson. Perhaps donate a month's salary to a worthy charity. Let him feel what it's like to be "unemployed" for a month through not getting a paycheck.

i diagree with you entirely...the man makes a high enough salary that he should be able to afford his and my goceries together! apologizing won't teach him or anyone else anything.

2 months is ridiculous for a repayment of only a couple hundered dollars that he probably had in his own acct on a seperate card.

on top of that has anyone looked into the downtown concert series and how it's all cash...i think it would be super easy to have money not accounted for and it be blamed on a mistake in ticket sales or something stupid like that...

he needs to be taught a lesson, fire him.

that being said, get vocal with the City Council. I don't live in the City or I would.

He needs a lesson.

But, in the absence of a policy prohibiting personal use of the card, he did not break the law.

So perhaps the Council should adopt some tough performance standards to be met or be terminated.