The fraud committed by a single Telugu association is resulting in serious focus and investigation by IRS and FBI authorities on all the Telugu Associations in the USA.
Shocked by the scale of financial crime in one organization, the authorities have selected ten more Telugu organizations to scrutinize their financials.
This revolves around exploiting the Matching Grants Program, a system that operates in corporate companies. When an employee donates to an NGO, their employer matches the amount, releasing it as a grant for the same NGO, aiming to encourage philanthropy.
The authorities received an information that taking advantage of this, a key person in a Telugu Association has been committing fraud for many years. The operation unfolds as follows:
Step 1: A Telugu Association member named XYZ contacts a Telugu individual named PQR, working in any US company, through mutual friends or acquaintances.
Step 2: XYZ sends $1000 in cash to PQR and instructs him to transfer the amount from his account to the Telugu Association's account.
Step 3: Once done, PQR's employer matches the amount, donating $1000 to the same Telugu Association on the company's behalf.
Step 4: XYZ repeats this process with hundreds or thousands of contacts, misleading companies and pooling funds.
This leaked crime caught the attention of authorities, prompting them to investigate all Telugu Associations that have exploited this loophole over the past decade.
Furthermore, another crime has come to the attention of US authorities: the person with check-writing authority in a Telugu Association transferred around $250,000 to a jewelry shop in Vijayawada, earning interest personally, a violation of non-profit organization bylaws.
Informed with indications of various financial frauds across different Telugu Associations, authorities are pursuing them rigorously.
What's worrisome is that some innocent board members of different Telugu associations over the past ten years may also face collateral damage.
Typically, key persons who hold check-writing authority in any organization are few, while the rest hold nominal positions. Trusting these key persons out of friendship or acquaintance doesn't absolve them of the crime.
It's going to be a tough time for almost all Telugu Associations that have been receiving funds through Matching Grants.
Regarding how the FBI and IRS can track the cash transfers, authorities have technological means such as Google Takeout and monitoring WhatsApp messages and emails. Simply deleting such messages won't suffice, as technology can retrieve data from various sources.
Aware of this, many Telugu individuals associated with different Telugu Associations in various positions are worried.
Speaking about this, an insider said, "This Matching Grants Fraud was perpetrated by a key person of a Telugu Association in 2018, and since then, many other associations have also followed the same path, hence the situation is critical now."
