This is a recorded interview (YouTube) about severe employee embezzlement at Attaboy Lawns (Johnson City, TN). Owner Mike Delugos describes discovering an estimator stole from jobs over months by deleting jobs in the company Jobber system, taking cash payments, underbidding work personally and using company labor. Financial consequences include an estimated $50,000 stolen directly, ~$5,000 in misused credit-card receipts, added high-interest loans (short-term $30,000 at ~18% APR plus prior small loans), monthly debt service rising to about $4,800–$5,000, equipment debt and plans to sell the owner’s house (roughly $150,000 equity) to cover obligations; the embezzlement was uncovered after a customer requested a receipt and the scheme is said to have ended in October.
Questions this video answers
February 16, 2024
Attaboy Lawns (Johnson City, Tennessee)
Approximately $50,000
Approximately $5,000 in receipts for personal purchases
October (year not explicitly stated in transcript)
Chapters
New tonight, police in Mosheim say more than $84,000 was stolen from an ATM Wednesday morning.
He had me fooled. He's a very good nick player. Just what he took, I'm estimating 50 grand. It's not just the money he stole. It's the high interest debt that I took. I've had to sell my house. I've had to watch my wife cry. I've had to watch my kids cry.
Over this the next 90 to 100 days.
He won't make it.
Mentally.
How many times do I get to stand in front of him and tell him that it's just falling apart in my. If I could get this short term bed off my back, we got a chance at a chance to turn it around.
This could be the hardest turnaround we've had yet. This million dollar lawn care and tree service has had an employee stealing from them all year long. And now there's so much debt, they are selling their personal house in order to be able to make the DEB payments. Let's see if we can turn this around.
Morning, brother. How you doing, man?
How are you?
Good to see you.
Wonderful.
See you.
Awesome. Love the truck.
Pink.
Let's go.
Yeah.
Good to see you, man.
Thanks so much for coming out.
No, thank you. Been quite the year, dude.
Oh my gosh, dude, it's been insane. Hey, I'm Mike Delugos, Attaboy lawns, Johnson City, Tennessee. We've been chasing our tail for about 10 months trying to figure out what the problem was. After digging farther, we found out that we had an employee embezzling in a significant manner.
I'm assuming there was our court stuff.
And all that around.
No, not yet. He still saw him four days ago driving. I'm waiting on subpoenas from Jobber. The detective basically said because there's not like record of what was deleted, we have to have subpoenas and get record of what was deleted.
So what exactly happened in terms of like him baking the books?
So basically he would go out and he screwed his hand the way he could have.
Yeah.
But what he would do was he would go out, take who's the leader? Go out, do the job, delete the job in the system and take cash payment. That was the biggest way. And he would turn in enough work and make enough complaints about the guys that are with him to make it look like he was just trying to train his crew up and get him ready to go. And we'd have conversations every day about what we can improve and do better and whatnot. And, yeah, be cool. He's a very good nick player.
So are you basically waiting on the subpoena? So that Jobber has to give them records that are deleted?
Yeah, I've even got recorded conversations with customers saying, hey, yeah, we paid them this amount in cash or whatever. Yeah, we didn't even take cash. But he tell people, oh, our system's down. I gotta get you a paper estimate. Yeah, we can't take card stuff like that right now. He almost got caught because of P4P systems. Actually, though, once, because of the double entry From Jobber at P2P, we didn't know what was going on. We're like, these old jobs are still open. What's going on? I told him to go over it with Reuben, the guy who runs a payroll. You know, these people don't even work here anymore. Because, like I said, we kept going through a bunch of guys because he kept telling us, you know, these guys aren't working out, whatever, so I'm not getting anything done. So we deleted a bunch of old jobs, P or P. And at that point, he realized he almost got caught, got smarter and stopped putting stuff. Stuff in the job at all.
So would he sell the jobs too?
He was an estimator. I found one job that he went out and bid for the company, came back underbid it personally, damaged their fence and ran off all the money.
And then he just used the labor from you?
Yeah, use our labor as well. So just. Just what he took, I'm estimating 50 grand. I've got $5,000 worth of credit card receipts that he purchased, you know, from Lowe's, Tractor Supply. All the normal places we go. But if you dig into the receipts, they're personal stuff.
When did that all go down? Like, it all end.
When did it all end? October.
Right? How'd you find out that? Like, how did it kind of come to light?
One of my old customers called me and asked for a receipt. Cash. Cash. They said, yeah, we paid the guy cash, and we never got a receipt. And I didn't think anything of it at the time. It was actually a couple weeks later, I was on the phone with a new businessman coach. And he's just like, something doesn't sound right. He's like, nobody's screwing you. Are they? And I was like, I don't think so. And then my mind went back to the incident two, three weeks before. Been so crazy, I haven't really looked into. And we found where that job was deleted that night. We stayed up till 3 and just started Digging and digging and digging and finding more and more and more stuff.
When a business passes $500,000 in annual revenue, it's essential that the owner start to delegate roles and responsibilities within the business if it's going to continue to grow. These role typically are categorized into sales, operations and admin. However, letting go of these tasks, you certainly do have to trust the person. And Mike handed off the entire tree division to this individual to be able to do all the sales and all the estimating. However, it came back to bite him.
And I'm sure we've got other issues too. But it's not just the money he stole. It's the high interest debt that I took to try and rescue it, fix the problem over and over and over again.
For that right now, what are we paying per day?
I'm paying 3,500amonth additional, I think.
Okay.
Interest essentially that's just like on top of our normal equipment debt and stuff like that.
Got it. And so that's for like 30 grand is the short term stuff.
Yeah, 30 grand, it's a year term. That's at 18%. But I took a series of small like 5 to $12,000 loans before that, thinking that I'd be able to. I'd fix the problem. You know, we raised prices from 78 to 98 year, thinking I'd fix the problem. You know, hire a new crew, thinking I'd fix the problem. Like, yeah, I'll just take the debt, we'll blow through it, it'll be fine. You know, maybe I'm too much of an optimist, but yeah, just a series of that added up and I was like on Fun Box originally I was taking 12 week stuff because I thought I'd be done maybe 12 week. And what I didn't realize until a third or fourth draw that I'm absolutely killing myself with interest.
Did they. Do they know kind of their finances and stuff?
Yeah, yeah, I'm not, not maybe not as bad as it is. 8, $8,000 right now I've got a couple thousand on my wallet and an insurance check from a different wreck. They don't know necessarily how bad it is, but yeah, I guess I sugarcoat it a little bit. But I also tell them that, hey, listen, we've got a serious issue and.
Like, do you think the other guy, the guys in the field know kind of where the company's at right now.
Or not really, for the most part, we know. They know that we're hurt. Yeah, I don't think that they know.
Oh, that's fine with that, any sudden.
Shift probably set us down the hill.
So on equipment, we basically have 104. On short term, we have 46,000. And right now our monthly payments are 4800 for the debt.
Essentially, yeah, that's probably closer to 5 now.
Okay, and so your hope, when. When is the house selling going through?
I don't know yet. I mean, it just got worse.
Oh, it just got listed.
Just got listed. That's why I haven't even been here. Hardly.
The hope is to sell that you have like 50 grand in equity to basically wipe out the short term debt.
I've got more than, thank the Lord, I've got more than that equity. I've got probably 150 at least.
Do you feel like sometimes you just trust people, like kind of blindly and like it kind of comes back to bite you?
I don't think I take it to the extreme, okay. I'm not just ignoring everything and just going through life with blinders.
What do you think led to that even being possible happen, though? Like, are we not finding, reporting, are we not having communication? Like that shouldn't really even be possible?
I'd say it was a lot of faith and trust in this person. He proved himself to be knowledgeable and seeing that he could run things, but he himself, not Mike, but the other guy, took advantage of the system basically of how we allow you to have so much free. And I guess that we should crack down on that.
You know, we had meetings weekly for several months. You know, it was just straight up deception. You know, he'd come in and ask me about problems he was having and how to handle it and felt like.
A normal relationship being the owner, even if you're not doing it.
