Posted: Sep 19, 2012 10:00 PM
Updated: Sep 19, 2012 11:13 PM
TUCSON - A high profile Tucson business woman embroiled in a missing money scandal has been under investigation in the past for the same problem.
The News 4 Tucson Investigators interviewed Bette Rathbun who owns a property management company that's been shut down by the state.
The company's missing almost $2 million from client trust accounts. The F.B.I. is investigating.
She denies involvement in either case. But this begs the question: why did Bette Rathbun lose her real estate broker's license the first time that money went missing?
"At that point in time, I took the fall. As my attorney kept saying, 'why are you falling on your sword?' because somebody had to take the blame," explains Rathbun.
Back in 2002 auditors found over $44,000 missing from a client trust account at Rathbun Realty.
They saw that the money, three separate payments, had been sent to a credit card company even though state law prohibits brokers from touching clients' money to pay the broker's business expenses.
"And I discovered the missing money," says Rathbun. "It was all put back. No one lost one dime. I put it back out of my own pocket."
Yet in 2006 the Arizona Dept. of Real Estate revoked Rathbun's broker's license over that episode.
An employee implicated along with Rathbun kept her license but was temporarily forbidden from handling client trust money.
"So I did, I took the blame to protect this other person," says Rathbun.
Fast forward to mid August of this year when a reported $1.8 million was found missing from the Rathbun client trust account.
Rathbun won't name names but says that same employee investigated in the first case, now with access to those accounts, is to blame.
"However, this time it's going to be a lot more difficult, and I'm not going to cover for this person anymore."
As the investigation progresses, Rathbun is now unwinding her business transferring what clients are left to a new property management company.
Below is statement from the attorney of the former employee referenced in this story:
Ms. Rathbun (Glover) has been the functional head of Rathbun Realty, and has been acting in that capacity, despite having her real estate license revoked because of the failure to protect trust fund moneys under her control. The license wasn't suspended, she was not just censured, she was revoked. Now 6 years later she is apparently blaming an employee who was under her total control, for her own failures. Rathbun now claims she was taking the blame for another. No, she was in charge, and it is her duty to protect trust moneys. That's why her license was revoked. Apparently she has learned little from her experience. If the problem was the fault of her trusted employee, that person would have been fired.
And then, when Bette's license was revoked, she has her husband become the broker for the business. Rathbun is attempting to find a scapegoat to cover their failure to protect trust moneys. That they have not done so is the reason so many property owners are complaining. Rathbun itself admits they have not paid money to owners that was supposed to be in trust. That they have not protected these funds (because that is the duty of the Glovers, owner, agents) is the reason the real estate department has closed them down.
There was no embezzlement by a "trusted" employee.
There has, apparently, however, been a loss of trust money. Who is responsible, the licensee, and his wife whose responsibility it is to protect the money, or is it the fault of an underling working under their authority? It was their duty to protect trust money, and they have breached that trust.
Now they are in trouble for the same thing. You figure it out.
--Statement of Patricia A. Taylor, attorney for former Rathbun Realty employee.
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