Accounting Scam at WBBM-TV

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The allegedly lavish lifestyle of Debbie Fogarty might have been an advertisement for "going to Disney World" or for the benefits of the American Express card. Last week, though, a photograph of a former accountant for CBS-owned WBBM-TV Chicago showed up not in an ad but in a mug shot following her arrest on charges that she misappropriated nearly $2 million in station money.

The former assistant controller, with her husband, Tim, was arrested last Tuesday and, accused of bilking the station by diverting funds from company American Express accounts into her own, faces criminal charges by the State's Attorney and civil action by WBBM-TV.

Fogarty had oversight of payments on the station's American Express business-travel accounts. She would overpay the accounts, according to the complaint, and would direct the credit card company to credit the overpayments to her personal Gold Card and Optima accounts.

Property belonging to the couple has been seized and assets frozen pending both legal actions. The station's complaint against the couple details an extravagant lifestyle of travel, jewelry, limousine rides, and thousands of dollars in toys for the couple and their two children, financed by $1.8 million diverted from station funds over a six-year period.

More than a half million dollars was spent on jewelry, with hundreds of thousands more spent on travel—including more than $150,000 for trips to Disney World—furniture, clothing, Barbie dolls and electronics from Best Buy.

Both Fogartys were charged with felony theft by deception and money laundering, after Cook County authorities set a cash bond of $500,000 for each. He was charged because he allegedly had knowledge of her activities. Felony convictions could bring sentences of up to 15 years. The couple remained in custody until at least later in the week for a hearing on their motion for reduced bonds, according to local reports.

WBBM-TV President and General Manager Joe Ahern gathered his staff into one of the station's large studios Tuesday afternoon to tell them that a former longtime employee had been arrested for stealing from the station.

He asked the staff not to be disheartened by the event or by the publicity it was certain to generate in a city where local television is big news and most cab drivers can rattle off news directors and ratings points as if they were ballplayers and batting averages. By Wednesday, the story had been covered locally by rival TV stations and by both the Chicago Sun-Times
and Chicago Tribune.

"I don't think this is a setback," says Ahern, whose history in Chicago television predates by more than 20 years his move to the longtime ratings-challenged WBBM-TV last August. "When you shed light on things like this, there's an important lesson. We are dedicated to fixing this, and we are going to rebuild this television station."

Ahern notes that, although he has never seen a situation like it in his decades in television, a television station, like other businesses, is vulnerable. "This is a big business, and we're constantly adjusting many accounts."

Taking over last year from Walt DeHaven, now running Viacom's KCNC-TV Denver, Ahern says, he set out to challenge every practice in place at WBBM-TV. In January, Justin Draper was hired to replace controller David Gittens, who retired after more than 30 years at the station, and Fogarty was fired in March for reasons unrelated to the current charges, the station says.

Within weeks, Draper alerted Ahern to discrepancies. Ahern brought in corporate accountants to review the accounts, and the matter was then referred to authorities. He believes that Fogarty's departure and subsequent inability to continue covering her tracks helped precipitate the discoveries.

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