In wake of financial scandal, Weavers Way looks to implement additional oversight

Officials at Weavers Way Co-op say customers won’t be impacted by the “inside job” that left the cooperative missing more than $25,000 and in search of a new chief financial officer.

General Manager Glenn Bergman said the company plans on implementing a series of reforms after accepting Michael McGeary’s resignation in late April, but that shoppers won’t see higher prices.

“You will not see any changes out front,” said Bergman.

Internal changes

Behind the scenes, the co-op will hire an outside controller to help oversee the company’s finances.

Surprise audits may also become protocol.

“It is important that we protect our assets, that we protect the values that we stand for from people who would take advantage of that trust,” said Bergman.

He added that having more financial oversight will be especially important as the company begins its search for a location for a third retail store.

Weavers Way currently has grocery stores in Mt. Airy and Chestnut Hill.

What happened

Last winter, the co-op’s finance manager found some “questionable” charges while reviewing the store’s credit card statements.

A number of them were gas and food-related.

At the time, the personal charges were believed to total just north of $2,000 and only cover a roughly two-month period.

After further investigation, though, staffers discovered that McGeary might have stolen more than $25,000 over the course of two and a half years.

It’s unclear exactly how much he took, Bergman said, because he walked off with invoices and receipts.

“We do have him on camera taking some papers…and putting them into a bag and leaving,” said Bergman, who detailed the incident in the June edition of ‘The Shuttle,’ the co-op’s monthly newspaper and a month earlier at a general membership meeting.

Last July, following an annual audit, McGeary changed the nonprofit’s financial review process so that he was the only one looking over his credit card submissions.

He also altered documents to conceal the personal charges he had made, said Bergman.

“He would fold over the bank statement, make a copy of it, and then put it through. Missing, was a $500 gift certificate charge that easily could have been found if we were using the original, printed document on the computer,” he said.

McGeary resigned on April 18. He did not return calls for comment.

Broken trust

For Weavers Way, the monetary loss is “significant”, but not devastating.

The 40-year-old co-op is now a $20 million operation and its employee theft insurance covers losses of up to $25,000.

The breach of trust, though, still stings, said Bergman.

This is not the first time Weavers Way has experienced bookkeeping problems.

In 2002, Weavers Way discovered that its longtime bookkeeper, Andrea Sheaffer, had made a series of questionable calls to cover up financial distress.

More than half a million dollars in members’ equity and other monetary liabilities were mishandled as a result, leaving the co-op on the verge of bankruptcy.

Bergman was hired afterwards.

Fallout from this latest incident appears to be nearly non-existent.

While gasps rang out after members learned of McGeary’s alleged abuse of power, little talk has surfaced about shopping elsewhere.

David Woo, who heads the co-op’s membership committee, likened McGeary’s actions to a Little League bookkeeper being caught stealing.

“You’re still going to go to Little League games,” said Woo. “I expect that we’ll recover from this one.”

The case has been referred to the Philadelphia District Attorney’s Office for possible criminal charges.