internal theft — Page 23

Exactly what is the primary cause of Employee theft in Atlanta GA?

June 19, 2011 by Staff Editor Leave a Comment

We know from long experience in the corporate fraud investigation field that there are many reasons for the employee theft you may be experiencing. Greed, want, need are all reasons. We as employers can do little to effect the reasons except to do the best we can to screen out potential problems. Criminal background checks find problems such as candidates with poor criminal histories; candidates that have a poor credit history who may be handling our money and drug abusers top the list

But what are the CAUSES of employee theft? In the 2010 Global Fraud Study by the Association of Certified Fraud Examiners it was found that the leading primary internal theft weakness is…”Lack of Internal Controls”. In organizations with less than 100 employees it amounts to 47% (over 100 employees equals 33.7%). There is not even a close second.

Keep in mind that the cause is something that we as business leaders have complete control over. Yet business appear to do little, or clearly not enough, to protect the fragile margins we have. I believe that there are two reasons for this.

Number one is that it seems in many cases there is a lack of strong leadership. The kind of leadership that people understand and respect. An understanding by employees at all levels that strong controls that the company has in place will not under any circumstances be violated and that such violation is not open to interpretation. The violation of these procedures will be met with strict and immediate punishment at all levels. This draws a line in the sand.

Number two is that even when that line in the sand is drawn we find it to hard or we are too busy to maintain it. Because of this that line in the sand is quickly washed away by the waves. We then find ourselves a year later scratching our heads trying to make sense of why we are having yet another corporate fraud investigation another serious internal theft or series of employee theft incidents have occurred.

Want to bring internal theft under control once and for all? Make your line in the sand a granite wall with no compromise that the waves will not affect.

For more information about employee theft or a consultation for a corporate fraud investigation in Atlanta GA contact us or call 1.770.426.0547

Employee Theft and Delegation of Duties

June 16, 2011 by Staff Editor Leave a Comment

There is one recurring theme seems to be present in almost every employee theft investigation that I have been involved in, and that is that the employee was inadequately supervised or had too much autonomous control over an area of the business.

I was having dinner with a friend who works in bank administration, and we were discussing the problems of internal theft (not great dinner conversation, I’ll grant you.) She remarked that at the bank where she was employed, every employee who handled cash and certain other financial transactions was required to take two straight weeks off each year, so that another employee had to take over responsibility for the person’s job for that period of time. This was done to avoid internal theft.

Then I thought of all the employee theft investigation that I have reviewed over the years, and how many of the thefts were discovered or suspected when the employee had to take extended time off for illness or other unforeseen reason.

These cases of internal theft were more often than not met with disbelief by management and co-workers who admired the person because he was so dedicated that “she never took vacation” or “he never wanted anyone to help him with his work”. Only later do they discover the reason why the person was so dedicated, and that was because it is much easier to cover one’s tracks when no one is checking up or adequately supervising one’s work.

One of the best and most efficient methods to avoid prolonged periods of internal theft is to institute a policy requiring periodic audits of every employee who has access to company assets, particularly in the accounting arena. Allowing the same employee to control payables, receivables, and payroll is too often asking for employee theft to happen. Delegating parts of the process will frequently avoid taking advantage of this situation. The employee theft investigation sometimes comes too late to recover all that’s been stolen.

But don’t overlook employees in shipping and receiving who handle merchandise and take out the trash. Is your merchandise in the trash to be picked up later. Many companies wisely conduct trash audits to avoid theft opportunities.

Every business owner needs to consider if their “best employee” is really that or are they covering up their own employee theft.

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

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Internal Theft Investigation Techniques

June 15, 2011 by Staff Editor Leave a Comment

It is paramount that you understand from the outset that an internal theft is not a triple homicide and an employee theft investigation is not an episode of CSI: Miami. You will never get anyone with the intelligence of a grasshopper to cop to employee theft by sitting them in a dimly lit room and grilling them over and over again. This only works on TV- really bad TV. The best way to achieve your goal (which, by the way, is a confession) is to gain the subjects trust, put them at ease and inform them that you’re here to help.

Hopefully you’ve nearly concluded your employee theft investigation by the time you sit an individual down to speak to them about an internal theft matter. Therefore you have gathered some proof about their wrong-doing, whether it be a policy violation or plain old employee theft, you know what you’re looking for. Frame your questions and statements in a non-threatening format. Avoid words like: Steal, Crime, Jail, Police, etc. Instead use words like: Took, Borrowed, Lost, etc. You want to put the subject at ease by minimizing the perceived severity of the infraction. Nobody is going to call up jail to make reservations. Ease their mind and their resistance by letting them see a light at the end of the tunnel.

Almost everyone will initially deny having committed employee theft. Help them to rationalize what it is that they’ve done. Give them excuses: The economy is bad, gas prices are so high, baby needs a new pair of shoes. Whatever will get them talking and feeling like you understand their pain and that you’re there to help. The next time you’re faced with an internal theft case remember these techniques and you’ll conclude your employee theft investigation with greater speed and efficiency.

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For more information contact us at Internal Theft or call 1.770.426.0547

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Is lax management causing employee theft in Atlanta GA?

June 11, 2011 by Staff Editor Leave a Comment

Internal theft, also known as employee theft, causes close to 50% of retail business loss each year. In the thirty years of preforming employee theft investigations I am still shocked by what a poor job most businesses do in common sense loss prevention. A good example of one of the instances was an employee theft investigation that I did where $5000 in fraudulent business checks were cashed. It turned out that the back stock of checks were unsecure in a storeroom with office supplies. Janitor’s stole20 some checks from the middle of the stack waited a month and them began to cash them. Those checks should have been secured under lock and key with strict access.

Every day we drop our guard because it is more difficult to do it the right way. Doing it the right way will prevent employee theft. The key is “prevention”. Or we say, “oh I trust that person, they would never do that”. Those words get more and more businesses in trouble everyday. When a management person says that they are basically saying that they have no common business sense.

Another case involved employees that stole hundreds of thousands of dollars in product from a distribution center they worked in. They were given keys to the facility that had millions of dollars of merchandise in it, with no alarm system. So coming back at night and loading up a truck was easy.

Internal theft or employee theft lurks around every corner. You have to be proactive to prevent it. Internal theft will not go away or stop on its own. In fact it will get worse. Get your policy manual off the shelf, dust it off, update it and make sure people understand that this is your “business bible”, live it and enforce it. That does not mean that it never changes, far from it. As your business changes your policy and procedures should change.

For more information on an employee theft investigation in Atlanta, GA contact us or call 1.770.426.0547

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Communication and Internal Theft

June 8, 2011 by Staff Editor Leave a Comment

Proper communication is key in preventing internal theft. Without it you open yourself and your company up to a great deal of potential loss. For several years I worked as a Corporate Fraud Investigator for a local supermarket chain. As great as that position was, when the time came I moved on and took another position at a completely different company. Apparently no one got the memo. The other day a few friends and I were on our way to a baseball game and stopped in to pick up a few tailgating supplies. One of the managers recognized me, shook my hand, asked how I had been and then promptly opened the door to the surveillance office for me using his key.

I understand that my previous position as Corporate Fraud Investigator afforded me some trust, but that manager missed all the employee theft red flags: He hadn’t seen me in a while. I was accompanied by people he had never seen before. I was dressed for a baseball game (completely unprofessional). I had to quickly explain the situation to the manager who was completely embarrassed.

The fact is: lesser men would have taken that opportunity to commit some kind of internal theft. After all, as a Corporate Fraud Investigator I would have known exactly how to get around any of the usual behaviors that might have given me away as a thief. Most employee theft happens as a result of perceived opportunity. Had I been a disgruntled ex employee I might have easily taken advantage of the situation. An individual may not have gotten to work intending to steal but because a door was left opened or unlocked, merchandise untagged, or any other safety measure not taken they will. This occasionally opens a Pandora’s Box where that individual begins to seek out similar situations throughout the company and before you know it you’re out of thousands of dollars all because the proper precautions and necessary communication wasn’t taken in order to prevent internal theft.

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For more information on an Internal Theft Investigator in Atlanta, GA ; Employee theft or Internal theft contact us or call 1.770.426.0547

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Internal Theft Investigation and the Real World – Atlanta Georgia

June 1, 2011 by Staff Editor Leave a Comment

An employee theft investigation is a situation most business owners and managers are uncomfortable with. This is understandable since this is a criminal and civil situation that the average businessperson rarely deals with. Because of this uncomfortable situation, there are trained employee theft investigator s . When an employee commits internal theft by stealing cash, merchandise, time or supplies they commit a clear crime. Most of the time the amount warrants felony criminal charges.

Internal theft in the “real world” happens in every business with employees. We would like to think that the person we hired would not steal from us. But the sad fact is that many do. Internal theft also known as employee theft many times is committed by some of the most “trusted” employees. The problem is management’s definition of “trust”. Many managers and owners use personal trust in a business environment.

Personal trust is the trust you have in a friend or spouse. You may trust them with your life, house, car or dog. But you do not trust them with your business! In my experience most employee theft flourishes in this environment.

Business trust involves something called “trust but verify”. A good supervisor prevents employee theft and thus the need for an employee theft investigation by not simply assuming that work tasks are accomplished the way you want them. Following up on what and how an employee for instance is checking in stock keeps them on track and cuts down on mistakes and let’s the employee know you are involved. A simple audit of what the employee is doing or has done with feed back to them both positive and negative lets the employee know that any dishonest actions have a good chance of being discovered. Many times employee theft takes root when the employee feels that no one cares or knows what they do.

The same hold true for a corporate fraud investigation. Executives at all levels must be held accountable. Audits by CFO’s should be conducted at all levels. An outside auditing firm can also be used to conduct company reviews. You must tell them to include this type of review with their work.

But for the average small business a corporate fraud investigation will never be needed. Focus should be placed on control of all assets. This can be accomplished with a loss prevention audit or by simply being engaged at all levels.

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

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Having problems with Employees helping themselves to your products?

May 22, 2011 by Staff Editor Leave a Comment

Some retail studies show that one third of all theft that a business may experience is employee theft. When a business owner looks to hire an employee, he hopes that the employee will be trustworthy and able to perform their job in a manner that helps in the function and profitability of the business. No business owner hopes to have employees contribute to their shrink numbers.

Internal theft is able to be prevented or reduced in a variety of ways. Managers and owners should maintain a good relationship with employees. Those that are disgruntled are less likely to care about stealing from their employer than those that are happy with their jobs. Businesses with low turnover rates have been shown to have lower rates of employee theft in some cases.

Policies and procedures need to be in place for a business’s vital areas, and these need to be followed by everyone. Business owners and managers need to realize that all employees could potentially choose to create a loss for their business, regardless of the fact that they have previously been a trusted employee. Circumstances may change in an employee’s life to where he or she may be able to justify a theft from his employer. Policies have to be enforced for every employee in order to prevent the opportunity to steal.

Another best practice is to have a background check conducted on all prospective employees. This will weed out the candidates that may have been caught and prosecuted at other businesses because of internal thef.

When an employee theft investigation needs to be conducted, businesses are wise to consult a corporate fraud investigator in order to complete an accurate and thorough investigation. When something raises a red flag that makes a business owner think employee theft is going on, there is probably much more that went unnoticed before that red flag was raised.

For information on how we can help you with an employee theft investigation or to find an corporate fraud investigator in Atlanta GA Check out our Website.

For more information on employee theft , internal theft , employee theft investigation or corporate fraud investigator contact us call 1.770.426.256.

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Employee Theft – Good Employee Goes Bad?

May 17, 2011 by Staff Editor Leave a Comment

Considering employee theft, no company willingly hires a thief. Most companies actually run some sort of criminal history or background check before they hire someone, just to be sure that they aren’t hiring a thief. So why does an allegedly honest employee suddenly turn to a life of crime and take money from his employer’s pocket.

May people may think that calling employee theft a “life of crime” is an overreach, but not the thousands of employers whose businesses are harmed by these thieves.

How do employers allow internal theft to happen? Is there any way to stop it?

Several of elements have to exist for theft by employees to continue:

The employee has some perceived need for the cash or merchandise; the employee either can’t or doesn’t want to pay for the merchandise; the thief has the opportunity to convert the property to his own use; the thief has little fear of being caught, or of the consequences if he is caught.

After conducting hundreds of employee theft investigations, the common denominator for individuals who continue stealing from their employers has been a lack of oversight by supervision, or the lack of internal controls within the company.

Generally, a trusted employee is allowed to go about his business without being audited or routinely checked up on by supervision. Employee thieves almost always start by stealing small amounts and grow bolder as time goes on and they remain undetected. Frequency of thefts and amounts taken increase until the habit is out of hand even in the mind of the employee.

The solution to internal theft lies in the culture of the company itself. Policies and procedures are designed and implemented which require certain job functions to be directly supervised or periodically audited to preclude continued employee theft. The fact that this happens should be communicated to all employees as they are hired and reinforced regularly. This should include every job function fro trash disposal (what else go out with the trash?) to the accounting department (does the same person do receipts, deposits, and disbursements?)

Maybe it’s time to take an objective look at your company’s policies and procedures and whether or not they’re being enforced consistently.

Loss prevention consultants have experience in analyzing and correcting any deficiency that allows employee theft to exist and thrive. An expert in loss prevention investigation can quickly and economically focus on those areas of the business that actually encourage internal theft through lack of attention.

To speak with a loss prevention investigator about employee theft, internal theft, or an employee theft investigation, call 1-770-426-0547 or click here for more information.

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Employee Theft is a Crime in Atlanta Georgia

May 17, 2011 by Staff Editor Leave a Comment

Employee theft is a crime and against the law just like any other crime, but don’t expect the police to react to it in the same way that they react like other crimes like purse snatching, robbery, or burglary. In fact, just call the police and ask them to investigate a theft that you suspect one of your employees may have committed, and unless it involves a whole lot of merchandise or money, don’t expect a robust employee theft investigation to be conducted. This is no indictment against law enforcement or individual law enforcement departments or officers, but they have better things to do. And off the record, I’ve had a police investigator tell me, “Don’t expect me to get excited about something that the employer should have prevented in the first place.”

So what can a business owner do if he suspects an employee has or is continuing to steal from him? Ask him? Confront him? Set him up?

The best bet is to find someone who knows in detail how businesses operate and also has the investigative skill set to analyze a problem and offer not only an immediate solution, but also ways to avoid internal theft in the future.

A corporate fraud investigator is trained and experienced in dealing with incidents of internal theft – money, merchandise, other property and supplies, time, identity, or even intellectual property. It’s an unfortunate fact that your own employees can hurt your business in ways that even your competition can’t. A corporate fraud investigator has the resources to deal with employee theft on every level, from white collar crime like embezzlement to minor pilfering like candy bars and snacks. Why would an employer worry about minor pilfering? Multiply 15 employees times a $1.00 candy bar times 5 days a week for 50 weeks. $3750.00 per year in employee theft through pilferage. And that’s just at a dollar each.

While conducting an employee theft investigation, a corporate fraud investigator will develop information through observation and interviews with the employees just how widespread the employee theft actually is. Business owners and managers are frequently shocked when they discover the scope of internal theft cause by employees at their business. Employee theft has a tendency to spread among employees until it almost commonplace if not stopped in its early stages.

To speak with a corporate fraud investigator about and employee theft investigation or internal theft in Atlanta Georgia or elsewhere, call 770-426-0547 or click here for more information.

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Employee Theft in the News

May 15, 2011 by Staff Editor Leave a Comment

Most employee theft cases never make the news, but the highly unusual ones or those that involve tens of thousands of dollars sometimes make it to the six o’clock broadcast or the local morning paper.

One such incident occurred recently near Albany, NY, when an employee of a major retailer was arrested and charged with the theft of over $42,000 in jewelry since 2009. That’s a lot of jewelry, even for a department store.

Read the entire story here.

The theft was discovered by Loss Prevention and store management when a merchandise audit showed an excess of items unaccounted for. When the loss prevention investigator confronted the employee, she was wearing some of the stolen jewelry.

The takeaway from this story was in a quote by the police lieutenant assigned to the case: “When we get these internal theft cases, it’s someone they trust. It ends up being a significant amount of money before it’s found out.” He added the internal theft of this magnitude happen about six times a year at his department.

According to the police, the ex-employee sold some of the jewelry to pay bills, kept some for personal use, and gave some away as gifts.

No matter the reason, employee theft hurts businesses both large and small. As a matter of fact, it probably harms small businesses even more, since they operate on smaller revenues, and don’t have an employee specifically tasked as a loss prevention investigator. Small business’ ownership and employees are generally more close-knit and more like family than those of a large employer. Because of familiarity, there is a tendency to trust employees of a small business more and give them more responsibilities with less supervision.

When a small business owner suspects internal theft, it is difficult for him to view the situation from an objective standpoint. Frequently by the time there is an indication of employee theft, the problem has reached a point where it goes deeper than one employee and involves large amounts of merchandise, money, or other assets.

Loss prevention consultants can develop and conduct loss prevention audits that will expose vulnerabilities in supervision, policies, and procedures. If a problem is suspected, loss prevention consultants can isolate the cause and determine the solution. If there are dishonest employees involved, the loss prevention investigator has the ability to gain knowledge through interviews with key personnel and make appropriate recommendations.

Don’t wait until employee theft puts you and your company in the headlines. Take action to prevent it from happening in the first place with an unbiased and objective analysis from experienced loss prevention consultants.

Call 770-426-0547 to discuss your employee theft suspicions with an experienced loss prevention investigator, or click here for more information.

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