Some business owners may believe that the cause of their lost profit and shrink is shoplifting. It’s easier to blame the questionable customers that may frequent our business than it is to believe that the very employees we trust with our business may be stealing. Statistics prove, however, that businesses typically suffer more loss from employee theft than they do from shoplifters.

Employee theft, or internal theft, is exactly as it sounds: it is theft that is committed against a business by its employees. It can be harder to detect, and the loss can be greater because there is greater opportunity for the theft to occur. Also, many business owners look past the employees as the possible cause for the losses that they may be experiencing.

Many smaller businesses do not have much experience with conducting an employee theft investigation. While larger businesses have a loss prevention or asset protection division that handle such things, smaller businesses may need to look to outside help when they are experiencing internal theft. Experts can be called in that are trained to conduct interviews, analyze reports and make recommendations as to what action needs to be taken to resolve the issue.

Businesses can take measures to help prevent employee theft. For example, a business can make sure that key controls are in place to prevent unauthorized employees from accessing high theft merchandise. Secure areas can also be managed by proper key controls. Additionally, businesses need to have an idea of what their inventory levels are at all times so that it is noticed immediately when merchandise may be missing.

Even the most involved business owners may experience internal theft at some point in their careers. How the employee theft investigation is conducted can mean the difference between forever being a victim to employee theft or acting appropriately so the problem is taken care of and others may think twice before committing the same crime.

For more information on employee theft , employee theft investigation or internal theft contact us or call 1.770.426.0547 – Atlanta Georgia

Now before I get hung at high noon, let me explain.  I’m not saying to stop customer service or that it is bad.  What I do hope to bring to light is that many things we do in the name of customer service allow employees to take advantage and create internal theft (the retail name for employee theft).

An interesting example of this type of employee theft came to light during a recent employee theft investigation I worked.  Like many companies, mine has a register function to “comp” the price of an item for the sake of customer service.  If we made a mistake we can use this function to alleviate the cost to the customer, but it keeps the item on the receipt for inventory purposes.  Sounds great in theory and as expected the customers love it.  On the down side we had a cashier figure out that she could use that function to take the whole price off of an order.  She then used this to create a little over $1,000 in internal theft of cash over about a month’s time.

The employee theft investigation revealed the following.  What she was doing was ringing up a customer like normal.  If the customer pulled out cash, she would then enter the code for “customer service” and essentially “pay” for the order with that function.  She would still give the total to the customer, take the cash, use a “No Sale” to open the drawer and manually make the change for the customer.  The customer got their full receipt and change and never knew anything odd happened.  What this did was build extra money in the till (which she later pocketed) since she took cash that the register did not know about.  In addition, she would use this function to give free product to her friends who came through the line.

For more information on internal theft, employee theft, or employee theft investigation contact us or call 1.770.426.0547 – Atlanta Georgia

Many business leaders contribute low profits to employee theft.  What you may not know is low sales can also be an indicator of employee theft (or internal theft in the retail world).  If you are noticing the same customer count, but decreased sales volume it’s time to launch and employee theft investigation.

Sure.  The answer could be that the employees just aren’t selling enough.  This could be due to standards like not getting the add-on’s, not suggestive selling or not merchandising to maximize appearance.  The answer could also be internal theft.  There are several ways that employees can steal that will directly impact sales results.  One way is through voids.  Associates can void individual items, but still allow the “customer” (i.e. their friends and family) to leave with the product.  You now lost the inventory, but your customer also purchased less.  Associates can also void whole transactions after a customer leaves.  This allows them to take the cash and the system thinks the sale never happened.  Again, you lost the inventory, but you also lost the sale as it is no longer in the system.

Another main way that employee theft occurs is through “sweet hearting”.  This is the LP term for “hooking up” others.  A cashier can do this a few ways, but the main ones are underringing and pass offs.  In underringing the cashier changes the price to charge someone significantly less than what they should be paying.  Again, this will cause less sales than if the items left at full price.  The associate can also bag items without ringing them up and let a friend, family member or other employee leave with the product.

Internal theft is the main causal factor for most retail loss, but it can also significantly sales.  I recommend using a trained LP Professional to conduct a routine employee theft investigation to ensure sales and profits remain high.

For more information on employee theft, employee theft investigation or internal theft contact us or call 1.770.426.0547 – Atlanta Georgia

I already here the questions.  Are you really concerned about coupon fraud?  My answer.  YOU BET!!  Employee theft, also called internal theft, comes in many different forms.  With today’s economy more and more people are looking for coupons in order to save money.  This can be a big bonus for stores; especially if you work in a business that uses a lot of coupons as you can grow incremental sales this way.  On the downside it is just one more way to incur employee theft.

Internal theft of coupons can do a few negative things.  One, it cuts into profits by causing a cash loss.  Most manufacturers will reimburse the stores for coupons redeemed.  If a customer redeems a coupon and then the employee takes it and uses it for their purchase, or a friends purchase, then you will only get reimbursed once.  The other time the coupon was used it just came out of your pocket.  The second issue with this type of internal theft is vendor relations.  Some companies, like grocery, conduct too many coupon transactions for each one to be individually counted by the manufacturers.  What they generally do is spot audit individual days and just assume the numbers are right.  If you have a lot of coupon fraud then the manufacturers may be reimbursing you for coupons you don’t actually have and when they find that on the spot audits it puts mud on your face as a company and calls your ethics into question.

The only way to prevent this is to routinely conduct an employee theft investigation looking for coupons fraud.  The first place to start is by looking at cashiers that are well above everyone else on coupon transactions.  The second is look at employee purchases with coupons.  Both of these could lead you to a founded case of coupon fraud.

I know an employee theft investigation is time consuming, but they don’t make a coupon to “save” you from internal theft.

For more information on employee theft , employee theft investigation or internal contact us or call 1.770.426.0547 – Atlanta Georgia

One of the biggest threats to a company is employee theft.  Employee theft, also called internal theft, is generally proven to be the number one shortage category in retail.  In addition, internal theft affects employee morale, benefits, and wages.  Employee theft also affects the ability of you, the business owner, to enjoy time away from work when you don’t know what is happening when you aren’t there.  For this reason I suggest using LP professionals to conduct a routine employee theft investigation to see what’s really going on in your store.

An employee theft investigation can take many shapes.  One way is you may know that you are losing a certain product or cash.  At that point the LP Agent can conduct an employee theft investigation to solve that particular problem.  Sometimes you may know who is stealing, but you either can’t prove it or you don’t know to what extent the theft is occurring.  Again, an LP Agent is trained to get these answers.  Finally, it is sometimes good to just shake the preverbal tree and see what falls out.

I have had a lot of success conducting integrity shops.  To do this the LP Agent will get someone unknown to the employees and set up a situation to test their integrity.  This can come in a variety of ways.  A common tactic is to turn in a live gift card and say it was found in the parking lot.  A good employee should turn the gift card into management.  What the LP Agent might find is that the employee keeps the card and uses it themselves.  The same basic tactic can be used to do several different situations, but the bottom line is it lets you know the caliber of the associates in the building and allows you to opportunity to “weed out” the bad apples in the bunch.

For more information on, employee theft investigation, employee theft or internal theft contact us or call 1.770.426.0547 – Atlanta Georgia

Recently I had to conduct an employee theft investigation involving gift cards.  Gift cards are great, but they are just one more way we as retailers can lose money.  Generally gift card theft is an internal theft (or employee theft) problem more than an external theft (shoplifting) problem.  The reason is simple.  Most all gift cards have to be rung into the register in order to be active and shoplifters cannot do this, but employees can.

Here is one internal theft gift card case I just wrapped up today.  A few days ago I got a call from a store manager informing me of a cash shortage of $100.  As we all know, mistakes usually don’t come in even dollar amounts like this.  This typically means someone stole Big Ben.  I started the employee theft investigation like normal and went straight to the “No Sales” and watched the video looking for cash theft.  When I did not find any I looked at the “Opening” and “Closing” of that till for cash theft.  Still nothing.  Here is where cash investigations get fun – NOT!!  I started looking at each transaction on the Electronic Journal to see if anything stuck out. 

I noticed a $50 gift card paid for with $50 in cash.  That struck me as a little odd because usually I see a birthday card or something else in the purchase.  I made the mental note and kept going.  Several transactions later I saw another $50 gift card for the same store.  This too was paid in even cash and no other purchases.  Now we’re getting somewhere.

Sure enough when I watched video I saw the employee on both cases scan a gift card with no customer present, pocket the card and put no money in the drawer.  Cash theft is a major employee theft problem, but when doing an employee theft investigation don’t forget about the other tender types as well.

For more information on employee theft investigation, employee theft, or internal contact us or call 1.770.426.0547 – Atlanta Georgia

Just kidding.  The fact is a proper employee theft investigation is quite difficult and time consuming.  Sure you could just pull your associates in and start making accusations, but did you know there is a large amount of liability in that?  If you can’t back up the claim you may be setting yourself up for even more loss.

Employee theft, or internal theft, is a common problem that all businesses face.  From fast food to clothing retail to doctors and lawyers; employee theft is a problem.  There are a few solutions available however.

The first, and the one I recommend, is to use a trained Loss Prevention Professional to conduct you employee theft investigation.  If you have the budget to keep a LP Professional on staff then you are ahead of the curve.  This person can be utilized to detect and catch shoplifting, internal theft as well as paperwork errors and other causes of shrink.  If you don’t have the budget, or aren’t quite sold on staffing your own LP Professional, then you can rent one.  There are companies who staff and train LP Professionals and then contract them out to retailers large and small when there is a need.  One benefit to this is reduced liability on your part as the contract company is responsible for their employee.  The reason I push this concept so hard is the training involved in doing a quality employee theft investigation.  Do you know how to read body language?  Are you familiar with the concepts of Neurolinguistics?  Do you know how to properly obtain a confession for all dishonest activity, including things you had no idea about?  The answer to these questions is probably “no”.  These are some of the things that a trained LP Professional has spent time studying and know.

The second option is to get the training yourself.  However you choose to run you business is … well, your business.  I just recommend that a trained person conduct internal theft investigations in order to do the job right.

For more information on employee theft, internal theft or employee theft investigation contact us or call 1.770.426.0547 – Atlanta Georgia

It’s unfortunate but internal theft or employee theft affects businesses more and more each year. The loss from internal theft dominates external theft or shoplifting. Business owners must realize that because your employees have full access to almost all your business assets, they have opportunity to steal. Co-workers can feel like family but you must put personal feelings aside and protect yourself and your business.

Employee theft examples include: cash shortages, falsifying paperwork, stealing of personal information from files or belongings, copying of keys, stealing of merchandise or business supplies. The list goes on. As a manager, there was a time when I felt a bit uneasy about a particular employee.

I decided to open an employee theft investigation. This file included notes of her behavior, schedule, register paperwork, credit card entries, refunds, etc; basically anything pertaining to this employee. Once while watching her, I noticed her extreme friendliest with a particular customer. The customer started to fill out a credit card application only something was missing, her identification.

The employee then pulled out a piece of paper from her pocket and she began to write down a social security number for the customer. Of course I could not believe my eyes. But felt a sense of accomplishment for going with my gut and opening up an employee theft investigation.

The employee then proceeded with opening up a line of credit and then charged several high dollar items on the new card. Then came the not so fun part. I had to speak with the employee on what just occurred.

Long story short, she admitted to taking social security numbers out of personnel files at the doctor’s office she worked full-time. The customer was a friend of her’s. Both were charged with identity theft and stolen merchandise.

Remember internal theft or employee theft cause more damage than any other. Go with your gut and open up an employee theft investigation. You never know it could lead to something big.

For more information on internal theft, employee theft, or employee theft investigation contact us or call 1.770.426.0547-Atlanta, Georgia

In fact, missing merchandise can just as easily, and just as likely, an employee theft problem.  Yep, you heard right.  Employee theft is a reality.  Internal theft, the retail term for employee theft, is generally the #1 shrink factor in retail stores.  Just like customers, employees often don’t want to pay for their products either.  So how do you know if the missing inventory is due to shoplifting or internal theft?

 The answer is you have to conduct an employee theft investigation.  One of the first ways to conduct an employee theft investigation is to track when the product goes missing.  To do this you will need to conduct “mini-inventories” or cycle counts, as they are commonly known, every day you work.  By doing this you will narrow down when the product is going missing.  (Thieves tend to stick to the same product group so you won’t have to count every item in the store; just what you have noticed is missing.)  You can then compare the dates of loss to your employee schedule to see if the same worker is present at every, or almost every, loss date.  This is not an automatic indicator of guilt as more than one person can be stealing the same product, but it will give you a starting point.

Next, is the tedious part.  Surveillance.  It is best if you have a Loss Prevention Agent that works for the company as this is time consuming.  There are also companies who have trained LP agents for hire that can help complete an employee theft investigation on a case by case basis.  You will need to observe the employee for several days to see if you can catch him/her in the act.  Hand in the cookie jar is the best way to avoid liability.  I also suggest package checks (especially when you think you have something).  The employee may not be expecting this and it’s a great way to get the evidence you need.

 For more information on employee theft, employee theft investigation or internal theft contact us or call 1.770.426.0547 – Atlanta Georgia

I can already hear the questions.  How are voids an employee theft issue?  Isn’t that just a problem with customer satisfaction or training?  The answer is “D” all of the above.  Voids are a necessary evil.  We would all like for customers to buy everything they come to the register with, but sometimes they change their minds about certain items or there is a problem at the payment time and the whole order has to be voided.  The ability to do a void is often a source of employee theft, also known as internal theft.  Here are some tips on how to do an employee theft investigation into voids.

Each day you need to review the voids from the previous day.  This is best done if you have reporting software that can show you all of the voids easily and can break them down into frequency by cashier.  If you don’t have this type of software this can be done by hand going through the journal tape.

Internal theft can occur with voids in a couple of ways.  First, employee theft can occur by the employee voiding an item or two off for a friend and family member while still putting it in the bag.  From video it looks like the item was scanned properly; however, the reality is it just got stolen.

The second way employee theft can occur is voiding the whole transaction.  A cashier may ring up a legitimate customer, accept the cash and then void the transaction.  Now the register has “extra” money that they can steal and it won’t show on your daily over/short report because the register thinks the transaction never happened.

Employee theft investigations are necessary in protecting your business.  Unfortunately, internal theft is a real thing so it is worth the time to “dig in” and see what is going on.

For more information on internal theft, employee theft investigation, or employee theft or contact us or call 1.770.426.0547 – Atlanta Georgia