West Palm Beach, FL -- Warren "Mac" McLaughlin, the president and chief executive of the Palm Beach County Convention and Visitors Bureau for nearly 20 years, resigned today over a scandal in which the bureau's former controller is accused of embezzling more than $1.5 million.
McLaughlin's resignation, which is effective immediately, follows the immediate resignation on Friday of Lee Davis, the bureau's vice president of finance.
A county audit of the bureau's finances concluded that a "complete lack of management oversight" contributed to the loss of funds. The county pays for most of the bureau's $9.5 million annual budget through the local hotel bed tax, which as of next month will be five percent.
The audit found that about $750,000 of the missing funds were intended for federal payroll withholding taxes, $480,000 for membership services, and $35,000 for pensions. About $300,000 were additionally embezzled, although it is unclear at this time which bureau operations were impacted.
To pay the back taxes, the bureau could seek more money from the county, which raises the possibility that hotel guests will pay more money for rooms if the county increases the bed tax.
The bureau might also cut its operations to make up the short-fall, possibly hampering its efforts to attract meeting and convention business.
The embezzlement was uncovered when a Wachovia Bank employee discovered irregular checking activity in connection with the bureau. The bank notified bureau officials on Oct. 23.
Donna Duffer, who was fired as controller last month, is accused of writing more than 200 bureau checks to herself over three years to support an online gambling habit. She has not been arrested, but local authorities are expected to file criminal charges following a complete investigation.
McLaughlin joined the bureau as its top staff employee in 1987. Prior to that, he served as president of Travel Industry Representatives, a tourism marketing firm; and worked as an executive for both Eastern and Piedmont airlines. Davis joined the bureau in 2000 as finance director and was promoted to vice president in 2003.
A private, non-profit corporation, the bureau employs about 50 people, according to bureau spokeswoman Enid Atwater.
Tourism is Palm Beach County's largest industry, generating more than $2.6 billion annually.
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