The owners of Rathbun Property Management want to know where their clients' million dollars has gone.
A huge discrepancy in the company's trust account was discovered Friday during an annual audit. Trust accounts are used to keep tenant deposits and rent payments separate from operating capital. The company manages 800 rental homes in Tucson.
Bette Rathbun, president and co-owner of the company, said only she, her husband and one longtime employee had access to the trust account.
That longtime employee "ran out the door at the beginning of the audit and hasn't been heard from since and won't answer her phone," said Rathbun, who founded Rathbun Realty Inc. in 1974.
Rathbun and her husband, broker and co-owner George Glover, filed a report with the Tucson Police Department.
"It's in the detective's hands now. They are still in the preliminary portions of the investigation," said Sgt. Chris Widmer, a TPD spokesman.
In an email to property owners Tuesday, Rathbun and Glover said the FBI and the Arizona Department of Real Estate are investigating as well. A spokesman for the FBI's Phoenix division would not confirm whether they were looking into the possible theft. Sarah Dobbins, a spokeswoman for the Arizona Department of Real Estate, said her office is auditing Rathbun Realty but could not comment further while the audit is ongoing.
In the letter emailed to clients, the owners said: "Rathbun Realty has experienced a major embezzlement by one of its most trusted employees. This individual absconded with the majority of funds in both our operating and trust accounts. I'm sorry to say that we will be slow in providing your monthly payments, but are working in earnest to satisfy all of our outstanding debts and obligations."
A day after the email went out, Rathbun said: "Most of our property owners are awesome. We contacted everyone. We told them, 'We're going to pay you back.' They're good people, and they've been wonderful."
Initially, Rathbun said $3 million was stolen. But since Friday, "we looked things over and it doesn't look as dark as we thought."
Property management companies are not required, by law, to carry insurance on their trust accounts, Dobbins said. However, in the letter to clients, Rathbun Realty said it does carry insurance and is looking into how much of the loss would be covered by its policy.
"I don't think we'll get any of the money back, but we'll earn it," Rathbun said. "My husband and I are going to have to work more. We were getting ready to retire and we're not going to be able to. We need to be here on top of everything."
Because last year's internal audit showed no discrepancies, Rathbun said the money must have been taken from the trust account within the last fiscal year.
"I think to myself, 'How do you spend a million dollars?' I don't know. All I know is, she doesn't appear to have any money," Rathbun said of the employee she suspects.
"We've been in business almost 40 years. I've never had a betrayal. I can't believe it. This is a person I really loved and trusted. It's absolutely unfathomable," she said.
Contact reporter Kimberly Matas at kmatas@azstarnet.com or at 573-4191.
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