The Growing Popularity of Employee Theft – Atlanta Georgia

February 28, 2011 by Leave a Comment

If you’re anything like me you are well aware of the existence of employee theft and the potential evil that dwells within the hearts of men (and women). However, you may not know to what extent that evil has grown within the last few years. “One bad apple spoils the whole bunch”. It’s a term I have heard my whole life and a belief I took with me into loss prevention. In short, I believe, not that everyone is a thief but that everyone has the potential to steal, so I keep my eye on everyone because I don’t know who the thief is. A recent report has changed my way of thinking.

The FBI has recently been quoted as saying that employee theft is “the fastest growing crime in America”. The U.S. Chamber of Commerce estimates that 75% of all employees steal from their workplace and that most do so on a regular basis. Furthermore, the American Society of Employers estimates that 20% of every dollar earned by a U.S. company is subsequently lost to employee theft. The problem is much bigger than most of us believed. There’s not just one bad apple in the bunch that we have to look out for. Whether it is the country’s economic state or the continual erosion of benefits the fact is that the face of the American workforce is growing grim.

1/3 of all U.S. corporate bankruptcies can be directly attributed to employee theft. It has also been reported that U.S. companies loose close to $400 billion a year in lost productivity due to time theft. These numbers are staggering and if they scare you then count yourself among the intelligent. The threat is real and the enemy is within the gates. It is critical, now more than ever, that companies get serious and focus on cracking down on employee theft, before it’s too late.

For more information about corporate fraud investigation or corporate fraud investigator or employee theft investigation or internal theft or white collar crime contact us at Employee Theft or call 1.770.426.0547 – Atlanta Georgia

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Preventing Employee Theft & Negligent Hiring Claims Go Hand In Hand – Atlanta Georgia

January 28, 2011 by Leave a Comment

In the thirty years of conducting employee theft investigations I look back and see that many of the problems these employees caused us could have been prevented at the time of hiring had the company paid attention to the warning signals.

If addressed in the beginning BEFORE a candidate is hired these same warning signals also provide your company protection from negligent hiring claims. It is important to look at hiring as a process that must be adhered to even if you are a small business.

To protect your company you should do the following:

  • All job applicants must fill out your application form. You should not simply accept their resume. They need to completely fill out you application and sign it. Your application should include a detailed work history. It should also ask about criminal convictions. Yes, you can do that and you should, every time.
  • Actually check their criminal records. It is easy and cheap.
  • Conduct personal interview with the candidate. This should be done by at least 2 people but the more the merrier.  I suggest 3-5 interviews with different management people in your company. This allows you to get many views and in the long run the new employee will be even more accepted as others have a stake in their success. Don’t have anyone else that can do an interview? Ask a trusted business friend, spouse or other person who is professional and will represent you and your company well.
  • Require references both personal and work related. Then actually check them. You will be surprised what they will tell you if you know how to ask the right questions.
  • Have a set of forms that you use each time for this and retain those forms in their file.

These items will serve you well and will help protect you from negligent hiring claims and employee theft. Make them a standard part of your business.

For more information about internal theft or white collar crime or employee theft or corporate fraud investigator or corporate fraud investigation contact us at employee theft investigation or call 1.770.426.0547 – Atlanta Georgia

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Various Types of White Collar Crime – Atlanta Georgia

December 13, 2010 by Leave a Comment

The term “ white collar crime ” was coined in 1949 by Edwin Sutherland. It is defined as: “a crime committed by a person of respectability and high social status in the course of his occupation”. However, in today’s business climate there are so many different kinds of white collar crime it can be difficult to understand what falls under that heading. Therefore, I’ve compiled a short list of examples and their definitions.

Blackmail: A demand for money or services under threat to do bodily harm, to injure property, to accuse of a crime, or to expose secrets.

Bribery: When money, goods, services, information or anything else of value is offered with intent to influence the actions, opinions, or decisions of the taker.

Computer fraud: Where computer hackers steal information sources contained on computers.

Embezz1ement: When a person who has been entrusted with money or property appropriates it for his or her own use and benefit.

Extortion: Occurs when one person illegally obtains property from another by actual or threatened force, fear, or violence, or under cover of official right.

Insider Trading: When a person uses inside, confidential, or advance information to trade in shares of publicly held corporations.

Kickback: When a person who sells an item pays back a portion of the purchase price to the buyer.

Money Laundering: The investment or transfer of money from racketeering, drug transactions or other embezzlement schemes so that it appears that its original source is legitimate.

Racketeering: The operation of an illegal business for personal profit.

Tax Evasion: When a person commits fraud in filing or paying taxes.

There are several other types of white collar crime , these are just a few examples and definitions that we should all become familiar with.

For more information about employee theft , internal theft or employee theft investigation contact us at white collar crime or call 1.770.426.0547 – Atlanta Georgia

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The Corporate Fraud Investigator and the Ponzi Scheme – Atlanta Georgia

December 9, 2010 by Leave a Comment

As a corporate fraud investigator you may be called upon to investigate any number of criminal and company violations. If you’re like me, or most other law-abiding citizens, most of the tactics and schemes used by these white collar criminals are as foreign to you as Chinese sign language. One such device is the Ponzi scheme; it resurfaced in popularity after it was expertly used by Bernie Madoff, the former stock broker and investment advisor who bilked his clients out of $18 billion and nearly $65 billion in gains.

Every corporate fraud investigator should be familiar with this scheme and how it works. A Ponzi scheme is a fraudulent investment opportunity that pays returns to separate investors from their own money or money paid by other investors, rather than from any actual profit earned. In other words, you invest your money with me believing that I’m investing in a company called Wally’s Widgets. At year’s end you see a sizeable return on your investment and believe that Wally’s Widgets is a great company. In actuality the money you received was from subsequent investors, minus my sizeable fee of course. The problem is that eventually I will run out of investors and the scheme will collapse on itself leaving my investors with a shell company (or companies) and no money.

The term comes from a Charles Ponzi who became known in the early 1920’s for using this scheme. He got a great number of people to invest in his business proposition but soon found himself using their money to pay off earlier investors and to support his own lifestyle. The Ponzi scheme usually entices new investors by offering returns other investments cannot guarantee, in the form of short-term returns that are either abnormally high or unusually consistent. This is just one more thing in a long list that a corporate fraud investigator needs to be aware of.

For more information about internal theft , white collar crime , employee theft or employee theft investigation contact us at corporate fraud investigator or call 1.770.426.0547 Kennesaw Marietta Atlanta Georgia

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An Example of White Collar Crime – Atlanta Georgia

December 7, 2010 by Leave a Comment

The term “ white collar crime ” is so broad that I figured I’d give you an example I read about recently that will hopefully help you wrap your mind around just how horrible a crime this can really be. For nearly 60 years a non-profit corporation known as The Conference on Jewish Material Claims Against Germany (or the Claims Conference) has been overseeing German government funds that assist Holocaust survivors.

The FBI recently announced that 6 Claims Conference employees, along with 11 other conspirators, had been charged with a decade-long scheme to defraud the organization and legitimate holocaust victims out of over $42 million.

Here’s how this particular case of white collar crime went down. Driven by crooked Claims Conference employees, former employees and other conspirators recruited people who weren’t eligible for the program to take part in the fraud. To make it appear that applicants were eligible, identification documents were often altered. For example, a birth date was changed to make it appear that applicants were born during or before World War II and fake Nazi persecution stories were often made up. Fraudulent applications were reviewed and approved by corrupt Claims Conference employees. Once the applicants received their money, they kept a portion for themselves but were instructed to pay certain “fees” using the rest. These “fees” were usually paid in the form of cash or money order and always ended up in the pockets of the conspirators.

The FBI’s New York Assistant Director in Charge, Janice Fedarcyk, said that the victims of this scheme were “those who had already suffered at the hands of Nazi persecution only to have their experiences exploited again. This brazen miscarriage of the compensation program is, in its own way, a kind of crime against humanity.” White collar crime is not, as many believe, a victimless crime. Often the least fortunate among us are the ones that suffer the most.

For more information about corporate fraud investigation , employee theft , corporate fraud investigator , internal theft contact us at white collar crime or call 1.770.426.0547 – Atlanta Georgia

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WHITE COLLAR CRIME AND THE CELL PHONE BANDITS!! – Atlanta Georgia

November 12, 2010 by Leave a Comment

White collar crime usually involves the upper crust of the criminal element.  Typically these offenders are of high social standing, have higher than average paying jobs and commit some sort of crime.

I remember starting in the corporate world and there was no such thing as a computer on everyone’s desk or a cell phone in everyone’s pocket.  Nowadays, with all the technology around us, white collar crime has a whole new set of avenues to venture down.  One of those roads is through cell phone fraud.

What is cell phone fraud?  It’s the unlawful use, tampering or manipulation of a cell phone or the actual cell phone service.  It would never occur to most people but…There are all types of evil criminal things we can do to commit fraud with a cell phone.  The two most prevalent crimes are cell phone cloning and subscriber fraud.

Cloning is based on the fact that every single cell phone in the world has a unique factory set electronic serial number and telephone number.  You can take a phone, “clone” another phone’s electronic serial number and phone number and bam, an unsuspecting user is charged for fraudulent calls.  Where does the white collar crime come in?  It’s easier to work for a cell phone company and obtain the electronic serial numbers to commit the cloning.

Subscriber fraud is when a person or persons signs up for service with fraudulent identity.  Where is the white collar crime in this?  When you are a patron at a store or retail outlet try to keep all your personal information private.  If employees steal your information it can take months or years to straighten out your credit report.

Have you been a victim of white collar crime ?  Contact us at white collar crime or call 1.770.426.0547 for assistance – Atlanta Georgia

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White Collar Crime…The art of Laundering Money – Atlanta Georgia

October 27, 2010 by Leave a Comment

“Money laundering.”  We hear that term associated with white collar crime on the news and in crime reports but does the average person actually know what it means?

I used to share an office with a gentleman who moved here from China.  It was in the early 1990’s when a famous case in the Atlanta area came to light.  Fred Tokars, an attorney in the metro Atlanta area, was convicted of killing his wife through a hired hit because she found out he was laundering money.

My friend came to work one day and asked me…”What is laundry money?”  Honestly I had no idea what he was talking about until he uttered the words….”FRED TOKARS”.  Then I knew.  I also knew I wasn’t really sure how to explain laundering money to him.

In the white collar crime world money laundering is very prevalent because most of the money that is laundered is gained illegally.  People want to cover their tracks.  Money laundering is defined as the practice of engaging in financial transactions to conceal the identity, source and/or destination of illegally gained money.  Tax evasion and false accounting make up many of the white collar crime accusations in the money laundering world.

The most basic money laundering scheme is called “cashing up”.  Say a business, such as a gas station, has a long standing relationship with a bank.  If they have made consistent deposits for years, then the opportunity may arise to make a “larger” than normal deposit every now and then.  This doesn’t look criminal, can be attributed to the business and the money launderer can now pull their money out of the bank all nice and clean.

People can also use shell companies that show income on the books but actually don’t make any money.  The income is reported, taxes are paid and the money is laundered.  This is white collar crime at its best, cleaning dirty money.

Do you suspect white collar crime in your business? Contact us or call 1.770.426.0547.

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White Collar Crime – Atlanta

October 14, 2010 by Leave a Comment

Nolo’s Plain-English Law Dictionary describes white collar crime as “a variety of non-violent financial crimes committed by business people or public officials, involving commercial fraud, consumer fraud, swindles, insider trading on the stock market, embezzlement, bribery, or other dishonest schemes.” Today we usually associate the term with individuals like Bernie Madoff, a stock broker who “made off” with billions of dollars of his clients money by turning his wealth management business into a humongous Ponzi scheme. However, white collar crime is far more often perpetrated on a less grand scale.

Consumer fraud, for example, can involve anything from bait and switch practices to full blown identity theft. This type of fraud can take place in person, over the telephone, or online. As technology continues to improve at a supersonic rate, many businesses are turning to the internet to give their customers more ease and versatility in acquiring their product. Look, you’re on it right now! As a result, internet fraud has risen faster than any other in the last few years. No business is too large or too small to fall victim to these types of crimes.

Computer fraud, credit card fraud, embezzlement and plain old theft all fall under the umbrella of white collar crime . What motivates people to commit these types of crimes? The same thing that (more than likely) motivated you to go into business in the first place: money. How do you safeguard your business and your customers against these crimes? Education and awareness are key. Inform yourself, be proactive, and enlist the services of a professional. The best way to prevent white collar crimes is to build barriers, or checks and balances, which limit the opportunity for those crimes to occur.

For more information about employee theft ,  white collar crime investigations contact us at White Collar Crime or call 1.770.426.0547

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Consider a Corporate Fraud Investigator for your white collar crime dilemmas

October 1, 2010 by Leave a Comment

As a Corporate Fraud Investigator, I’ve spent countless hours looking at journal entries, profit and loss statements, balance sheets, ledgers, investment scenarios and countless other corporate level sales, profit and investment tracking practices. And forensic accounting, a major tool in the Corporate Fraud Investigator toolbox, is a useful asset to have. Understanding how and why a business accounts for their practices is the key to performing a solid fraud investigation.

As an example, let’s say inventory time is coming around. The public company you work for has about 7 stores. Pretty moderate sales volume, your company is growing. Now, as the inventory numbers start coming in, your corporate inventory guy starts to worry about the shrink numbers in one of the stores. He directs the in-store manager to report no more than $30k in losses on a sales volume of $1million. In reality, the store lost $50k in inventory. The manager is told the other losses will be poured into some other (bogus) account. The manager, following direction of the corporate office shows $30k in inventory loss and the corporate office books him for $30k. The other $20k gets put into a gross margin fund at the store level or is dismissed. Either way, bogus!

Now the outside investors see these shrink numbers and think, WOW, great news.

As a Corporate Fraud Investigator, you hear word from the loss prevention agent at a particular location about the inventory process. You start your investigation and the unraveling begins.

A good Corporate Fraud Investigator can be the best friend of the organization. Keeping a watch on fraud, waste and abuse and knowing when to react will ensure your business stays a business for many years to come.

For more information visit us at corporate fraud investigator or call us at 1.770.426.0547

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Employee Fraud – A sample of Loss Prevention in Atlanta

September 28, 2010 by Leave a Comment

Let’s talk a little about corporate fraud , a sometimes underestimated and misunderstood factor of internal theft.

Employee fraud is a very much relevant dishonest trend amongst all levels of employees. From corporate fraud , white collar crime to the store associates ringing on the registers for 8 hours a shift. All subject to it, some fall into it. Now corporate fraud and white collar crime are a true threat, the instances are not as common as the young full time employee ringing on the register. They are not faced with the same daily temptations. Both are equally destructive, yet one stands out as the true indicator of employee fraud.

As an example, we had a cashier. He was a young, part-time man…about 19 years old. He discovered a unique feature of our cash register systems. The system allowed him to use multiple coupons for items he wanted to purchase. On his lunch break, he took a handful of the store’s ads from the front display and went to the Break room. Over the next 45 minutes, he cut out various and multiple coupons of items he thought he could sell at his uncles’ shop in the downtown area.

Using his employee discount along with several coupons, the employee would ring the items for just about free, and at times would get some cash back. He scanned multiple coupons, multiple times. He had discovered competitors coupons with our company’s endorsement and in-house coupons (those created by our corporate office) were not flagged for multiple use in our stores register system. So an electronic toothbrush for $50 retail was sold to him using 5 $10 off coupons. What a deal.

After a loss prevention investigation, I was able to discover the trend of the employee fraud and identified several fraudulent transactions that later caused problems for him and his uncles’ side business.

The retailer subsequently made changes to their register system and advertisements to impose disclaimers on usage.

Employee fraud may not be the easiest to identify, but it is a regular occurrence amongst retailers.

For information on employee fraud or white collar crime in Atlanta please contact us at employee fraud or call 1.770.426.0547

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