Findings in Fraud

What happens when a business is inadvertently connected to a fraud scheme?

John Truman’s income tax and retirement-planning firm is living through just that.

Truman said he couldn’t have known Christian County Sheriff Joey Kyle’s intentions when Truman & Associates Inc. helped establish Five Rivers Management LLC in 2011.

“That was me helping him establish it through the secretary of state’s website because he didn’t know how to do that. Nothing more, nothing less,” Truman said. “The plan to use it in the initial stage was to form a logistics company for law-enforcement training. But with what he’s apparently dealing with now – I had no idea of that.”

Kyle, 53, of Ozark, admitted to embezzling over $50,000 from Christian County through fraudulent invoices and laundering the proceeds of a political supporter’s illegal investment scheme. In 2011, the sheriff founded Five Rivers Management to serve as a law enforcement training company. Kyle admitted to prosecutors he used the company as a front to hide the source of funds from a “Subject No. 2,” which federal prosecutors declined to name.

Investigators linked Kyle to Nixa-based EDI Plus LLC, which was contracted by the county to provide equipment, such as firearms and ammunition, to the sheriff’s department from 2011 to 2014. Truman denied any involvement with the scheme.

“I directed him to the website, and he listed me as one of the organizers,” Truman said, declining to say how often Truman & Associates helps register companies with the secretary of state. “There’s been no fallout to this point, and I’d like to see it stay that way.

“I was never involved with it.”

Truman did not respond to Springfield Business Journal’s questions about how he knew Kyle and said he’s had no contact with investigators. According to TrumanAndAssociates.com, the founder of the company, Don Truman, started the firm in 1980 while working as a sheriff’s deputy.

Truman’s story reflects what businesses and individuals sometimes face – potentially harmful connections to those allegedly breaking the law. Those connections might be absent of guilt, but if public perceptions link the parties, the bottom line could be damaging.

Local media shared the sordid details of Kyle’s crimes with the public.

Under a much different scenario, Jay Holden knows what kinds of issues organizations can face when negative news hits the streets. A former marketing executive for Kanakuk Kamps in Branson, Holden worked for years to overcome perceptions about the Christian-based campground after former director Peter Newman was arrested in 2009 on sex charges involving several underage boys. Holden is currently a marketing manager at Paul Mueller Co.

In the immediate aftermath of the Newman incident, Holden said Kanakuk Kamps administrators answered media inquiries while maintaining a posture that was sensitive to the victims.

“The most important thing you can do is to establish some very clear lines of communication internally and externally,” he said, adding it’s important that all administrative, legal, operational and marketing employees are on the same page, which can help ensure the public receives accurate information. “When something like that happens, it’s overwhelming; it’s unexpected and emotional. It resets your world.

“The media is calling, and they may talk to whoever is answering the phone.”

As for the impact, he said it was significant, but he declined to quantify it. The operation draws roughly 14,000 campers each year.

“It’s hard to talk about the impact on Kanakuk Kamps because I’m also acutely aware of the impact on victims. At the time, almost 100 percent of the focus was on victims,” he said. “They didn’t need this played out in public anymore than it absolutely had to be.”

As time went on, Holden said it was frustrating that common Google searches about Kanakuk immediately led to stories about Newman. The team developed a strategy to find ways to talk publicly about prevention and share stories on social media about the organization’s faith-based mission.

“Our focus was then put on providing positive content,” he said. “The whole search engine game is 30 percent technical and 70 percent finding ways to provide content that people want to consume.”

Among top stories generated from a Google search of “Kanakuk Kamps” these days is a 2013 article by the St. Louis Post-Dispatch about how the organization wants to lead efforts to prevent sexual abuse.

Matt Freeman, vice president and co-founder of Springfield-based reputation management firm Pinpoint Media Group, said the 4-year-old company was formed as a way to help businesses improve and repair their reputations.

“A reputation that a company has is how it distinguishes itself from other companies,” he said. “If a person or other company doesn’t trust you, they’re not going to invest in you.”

He said Pinpoint Media manages reputations in primarily two ways: through preventive measures, such as building up and sharing positive stories about the company’s work, and through crisis management, which is handling public relations in the aftermath of an event that could damage a reputation. He said preventive measures could cost around $300 per month, and crisis PR ranges from $5,000 to $10,000.

“It could be a past employee that leaves a hateful comment, and especially if it’s malicious, there are ways we can get comments taken off,” he said. “A lot of people don’t know what to do when something like that happens. We’re there to mitigate that type of situation.”

Recently, Freeman reached out to Springfield Business Journal, Springfield News-Leader and 417 Magazine to remove old stories from archives connecting former Bates & Associates architect Jarod Michel, who was indicted in October on federal child pornography charges. The requests were denied by SBJ and the News-Leader but not by 417, according to News-Leader reporting. Freeman said there are often limits to what’s possible. If stories are factual and reviews are real, anyone has a right to share them.

“With reputations, I can use the metaphor of a door. Whenever a company first starts out, the door is wide open. It has all the opportunities in the world to make it something successful and to make money or whatever their goals are. When something happens to its reputation, the door closes a little bit each time,” he said. “Reputations are worth their weight in gold. You can always make more money, but you can’t always repair reputations.”