California Attorney General Rob Bonta filed a civil lawsuit Thursday alleging fraud and other financial misconduct by six San Diego County residents who allegedly took part in a $3.8 million scheme that involved pocketing charitable funds that were earned by selling concessions at Petco Park and Snapdragon Stadium.
The two lead defendants named in the civil case, Noly Hermoso Ilarde and Martin Jose Rebollo Jr., recently pleaded guilty to criminal charges in San Diego federal court, admitting that they ran a fake charity to carry out the fraud scheme and personally took more than $2 million in funds derived from it.
The new lawsuit, filed in San Diego Superior Court, alleges that four other individuals, including Ilarde’s wife and sister, also took part in the scheme by posing as unpaid volunteers when in reality they received tens of thousands of dollars from the alleged charity…
PAYROLL & HR CONTROLS (PREVENTING “GHOST” SCHEMES)
Payroll fraud is often the hardest to detect because it “looks” like a normal business expense.
- Segregation of Duties (SoD): The person who adds new employees to the system must not be the same person who approves the monthly pay run.
- Mandatory Vacation Policy: Require all financial and HR staff to take 5–10 consecutive days of leave annually. Fraud often surfaces when the perpetrator isn’t there to “hide” the trail.
- Ghost Employee Audit: Perform a quarterly “Headcount Reconciliation” where managers must physically verify every name on their payroll list exists.
- Self-Pay Blocking: Ensure the payroll software has a hard-coded block preventing administrators from editing their own salary or bank details.