Following the resignation and departure of the Specialty Coffee Association of America’s (SCAA) Chief Operating Officer on September 12th, a serious cash shortage was revealed. An immediate investigation by SCAA’s Executive Director uncovered serious accounting irregularities and a loss of SCAA’s cash reserves.    The association has reported this situation to the appropriate authorities, including insurers and the police.  A formal investigation has been initiated and is ongoing.

The SCAA President, Secretary/Treasurer and Legal Counsel were immediately advised of the situation when it was discovered. They first informed the Executive Committee and then the entire Board of Directors. Following notification, the Board took the following actions: they 1) reported the nature, scope, and seriousness of the problem to the 125+ Committee members participating in the previously scheduled annual planning meeting; 2) restricted check signing authority to the Executive Director and Secretary/Treasurer of the Board of Directors; and 3) developed an action plan through the Committee structure to resolve the current cash crisis.      

The elements of the plan for moving the association out of the crisis are three-fold. First, the SCAA has created a membership endowment fund to cover the association’s short-term loss of working capital. Second, it is continuing the normal conference planning process so that the SCAA’s Charlotte conference and exhibition is just as successful as the previous 17 events. Third, it is streamlining headquarters activities to operate within the current limits of available resources from membership dues.

The combined goodwill and determined efforts of the SCAA board of directors, staff, volunteers, members and business partners will ensure the timely and effective resolution of this situation.  SCAA remains committed to its membership and is dedicated to ensuring the specialty coffee industry remains viable and strong.  Rick Peyser, President of the SCAA Board of Directors, said, “The SCAA will continue to be the leading source of information and services for the rapidly growing specialty coffee community.  We are moving forward with Executive Director Ted Lingle to achieve the plans we have developed and are looking forward to an outstanding annual conference that will be held in Charlotte, North Carolina April 7-10, 2006.”   The SCAA board will keep all association stakeholders informed regarding the current status of the situation and the full outcome of the investigation.