A diversity charity went "off the rails" when its only full-time employee cheated it out of thousands of dollars, according to one of its directors.

Brenda Dale said Diversity Institute Bermuda lost credibility with its backers because cash they were pledging was disappearing from the company accounts.

It later emerged clerk Colette Lundy had been using the charity's credit card to buy personal items.

Lundy — who committed the thefts six years ago and then fled to the US — was finally caught out when she returned to the Island this year and was spotted outside Miles Market by a company director.

Last week, Lundy admitting stealing more than $3,400 and was fined $2,000 in Magistrates' Court. Mrs. Dale said Lundy was also ordered to pay back a further $10,000 following a separate civil judgment.

Mrs. Dale told The Royal Gazette Lundy's actions had demoralised the charity, contributing to it being wound up in 2005 before reforming with four elected members on a new board.

"When it happened, we were short a lot of money," said Mrs. Dale. "The charity does educational programmes and would be getting donations from corporate groups.

"But corporate sponsors were looking at us and saying 'How come you lost this money? Should I give you more?' It had a terrible impact on the members.

"The board and members felt betrayed. There was a lot of bad feeling about what happened."

DIB is based at Bermuda College and aims to raise awareness about how to deal with people from diverse backgrounds. Mrs. Dale said the charity was "derailed" when the cash went missing and has struggled to get back on track.

"At the time it happened, the main issue we were struggling with was that we needed administrational support. We needed a full-time person and we couldn't afford one," she said. "It took a lot of wind out of our sails."

Mrs. Dale said the Commission for Unity and Racial Equality and Citizens Uprooting Racism are now carrying out similar work to DIB, leaving it unclear over what role it can play in the future.

At last Thursday's Magistrates' Court hearing, defence solicitor Elizabeth Christopher said Lundy was ashamed by the reputation she now had in Bermuda.