The officials at the Sebewaing Light and Water Department in Michigan, did not pay heed to audit reports that mentioned significant deficiencues in the accounting procedures. These warnings date back to 2006. Finally in May 2012, the auditors noticed that the money deposited into bank account was different from what was booked in accounting books and found an embezzellent of more than $39,000 done by an employee.
Due to shortage of employees, one employee would sometimes deposit the cash, record it and then reconcile it.  The detailed duplicate deposit tickets prepared by the cashiers did not contain a listing of the checks.  There was no independent review of the bank reconciliations which would perhaps brought this issue to light. The key issues here were segregation of duty and lack of independent review of the financials.
The number might seem small, but consider that the per capita income for the village was ~$17K. A $39K embezzlement definitely could make one person richer!