How $16 Million was Stolen from a Bakery

By Charles Hall | Asset Misappropriation

Jan 17

Is it possible to steal over $16 million from a bakery? Today we see that large sums can be taken from a small, mundane business. And the scheme can be so very simple.

The Theft

Sandy Jenkins, the controller of Collin Street Bakery in Corsicana, Texas, made off with more than just fruitcakes. He took over $16 million, so says the FBI. And what did Mr. Jenkins do with the money?

He used the funds in the following ways:

  • $11 million on a Black American Express card
  • $1.2 million at Neiman Marcus in Dallas
  • 532 luxury items, including 41 bracelets, 15 pairs of cufflinks, 21 pairs of earrings, 16 furs, 61 handbags, 45 necklaces, 9 sets of pearls, 55 rings, and 98 watches (having an approximate value of $3.5 million)
  • Wine collection (having an approximate value of $50,000)
  • Steinway electronic piano (having a value of $58,500)
  • 223 trips on private jets (primarily Santa Fe, New Mexico; Aspen, Colorado; and Napa, California, among other places), with a total cost that exceeded $3.3 million
  • 38 vehicles, including many Lexus automobiles, a Mercedes Benz, a Bentley, and a Porsche
  • And more…

How the money was stolen

You might think that stealing $16 million would require an elaborate scheme. But did it? 

Here’s an example of his method: Jenkins would print a check to his personal credit card company, but he would void the check in the accounting system. (He still had the printed check.) Then, he would generate a second check for the same amount to a legitimate vendor, but the second check was never mailed. Next, Jenkins would send the first check to his credit card company.

The result: Jenkins’ credit card was paid, but the general ledger reflected a payment to an appropriate vendor.

$16 million stolen from a bakery

The picture is courtesy of

The Weakness

No one was comparing the cleared check payees to the general ledger. 

The Fix

Someone other than those who create checks should reconcile the bank statements to the general ledger. As they do so, they should compare the cleared check payees to the vendor name in the accounting system. Some businesses have hundreds (or even thousands of checks) clearing monthly. Therefore, they may not desire to examine every cleared check. 

Alternatively, the business could periodically sample the cleared checks, comparing the cleared checks to the vendor payments in the general ledger. The persons creating checks should know that this test work will be performed. Doing so creates the camera effect. When people know their actions (in this case, the creation of checks) are to be examined, they act differently–they are much less likely to steal.

If you desire a preventive control, you could require a second-person review of cancelled checks.

Lastly, when segregation of duties is not possible, have the bank statements mailed to someone outside the accounting department such as an owner. That person should review the cleared checks before providing them to the accounting department. Alternatively, provide online access to the reviewing person. The reviewer should examine the cleared checks and provide documentation of his or her examination to the accounting department.

What Happened to Sandy Jenkins?

Sandy Jenkins was sentenced by U.S. District Judge Ed Kinkeade to serve a total of 120 months in federal prison. His wife, Kay Jenkins also pleaded guilty to one count of conspiracy to commit money laundering. Ms. Jenkins was sentenced to five years probation.

Subscribe to 10 Days of Fraud Prevention

You'll receive my free 10-day course with examples of frauds and how to prevent them in your organization. You'll also receive my periodic newsletter. (You can unsubscribe at any time.)

Powered by ConvertKit

About the Author

Charles Hall is a practicing CPA and Certified Fraud Examiner. For the last thirty years, he has primarily audited governments, nonprofits, and small businesses. He is the author of The Little Book of Local Government Fraud Prevention and Preparation of Financial Statements & Compilation Engagements. He frequently speaks at continuing education events. Charles is the quality control partner for McNair, McLemore, Middlebrooks & Co. where he provides daily audit and accounting assistance to over 65 CPAs. In addition, he consults with other CPA firms, assisting them with auditing and accounting issues.

Leave a Comment:

(9) comments

Peter Goldmann June 25, 2016

Another control would be to run analytics on disbursement so looking for an unusual number of voids then look into the reason for the voids

Charles Hall June 25, 2016

Good thought Peter. I fully agree. Thanks for the comment.

David Rothfeld June 26, 2016

Who was reconciling the checking account? Did they not notice (foolish me) that voided checks were clearing and outstanding checks for the same amount were still outstanding? Or was Jenkins also reconciling the bank accounts.

Betty Kirk June 27, 2016

What about check 21? As an auditor, we are lucky if there is even a blurry, tiny copy of a check to look at. Only the front, no back of the check for signature comparison or account numbers. You can’t rely solely on the bank reconciliation process to catch this kind of thing. Someone who knows the business should be looking at vendors, and wondering why they are getting paid so much. Bank Recs are always an easy recommendation, but there are other indicators to look at.

Charles Hall June 27, 2016

Betty, I so examined cleared checks, but, yes, I can’t see the back of the checks, though, on occasion, I have requested the backs of checks. Without seeing the payee on the cleared check, this type of fraud is always a possibility. I agree that “looking at vendors, and wondering why they are getting paid so much” is a good step.

Charles Hall June 29, 2016

David, good question. The articles I read about this theft did not disclose who was reconciling the account, but I got the impression Jenkins was reconciling. Otherwise, someone would have (should have) noticed the scheme earlier.

HARISH DUA January 18, 2018

Since its a brief article, it does not say how large a bakery it was or how long the fraud went undetected, but one basic question seems to hit me as follows: Where was the CFO or the Owners and how come they did not sense anything amiss? We dont need process level controls of cleared check payees, since hiding such a huge amount in the books is next to impossible. It would have to show up as a big distortion in the overall numbers or ratios and just a few simple analytics by a CFO or the Auditor should have got the alarm bells ringing.

Charles Hall January 18, 2018

The FBI article ( says Mr. Jenkins become the controller in 1998. Usually, in these types of cases, the fraudster is taking money over a period of time, so the effect is less pronounced. I think of Rita Crundell who stole $53 million from a small city; she did so over a 20 year period. I had the same thought in reference to her fraud. How can someone steal that much money without notice?

But, yes, I agree with your point.

Terri Hornberger January 22, 2018

Since Collin Street Bakery is a family owned business in a small-ish town, everyone trusted everyone. Mr. Jenkins was reconciling the bank accounts himself and had made up stories to tell his staff about missing checks (the “voided checks”). The money was taken over a long period of time. Mr. Jenkins also had stories about inheriting money so that explained how he went from living modestly to a higher standard of living. Agree that the CFO should have noticed. This was discovered when an employee decided to reconcile the bank account while Mr. Jenkins was out-of-town.

Add Your Reply

Leave a Comment: