Conducting Employee Theft Investigations – Atlanta Georgia

When conducting an employee theft investigation it is extremely important to establish proof of wrong-doing and to maintain strict confidentiality during the investigation process. We’ve all seen the television police dramas where the suspect is placed in a dimly lit room and detective so-and-so goes in with little more than a manila envelope and a gut feeling and gets the suspect to break down like a blubbering idiot and confess to every crime they’ve ever committed. Trust me, it doesn’t work like that in the real world.

I once had an ex-friend of an employee call the company and inform us that not only was this employee an habitual drug user, but that he had been stealing money from the registers for months in order to support his habit. I had previously assessed this employee’s character and didn’t find the allegations too far-fetched. Now, I could have dragged him in the office immediately and read him the riot act, but that type of “cowboy investigation” is liable to land your company in hot water and you, the investigator, on the unemployment line. Instead, I enlisted the help of one of my top detectives and, while maintaining strict confidentiality, performed an employee theft investigation using several point-of-sale reports and CCTV recordings to build our case.

Then, and only then, was the employee brought in for questioning. Although he did eventually confess, it really wasn’t necessary. I had already built a case so airtight that David Copperfield would have been hard-pressed to escape it. The entire process took just over 4 days. An employee theft investigation is an essential part of protecting your company’s bottom line, but they must always be conducted in a professional and confidential manner. Remember: Take swift action, obtain irrefutable evidence and maintain confidentiality and your employee theft investigation will be smooth as slippers on a slug. (Yeah, I made that up.)

For more information about employee theft or employee fraud contact us at employee theft investigation or call 1.770.426.0547 – Atlanta Georgia

Employee fraud more of a temptation in poor economy and becoming tougher to tackle

The poor economy leads more people into employee fraud temptation.  They say there are three types of employees; those who fall into the ten percent who will never steal from you no matter what, those who will steal from you at some point if given the right opportunity at about 80%, and the final 10% who are going to steal from you no matter what.

So the eight percenters are the ones we need to watch, obviously now more than ever, being in these tough economic times.  And this 80% group is probably full of people you would think would never steal from you no matter what.  So how do you know who is a thief and who is not when you recognize you are having a problem somewhere and likely experiencing employee fraud of some kind?

Your CPA may be the first person you call to put some pieces of the puzzle together.  They will no doubt find issues.  So now what? You have some irregular activity identified, could be one or more of a few different employees.  How do you get to the truth without accusing all the potential suspects and damage relationships with good employees?  Answer, a professional corporate fraud investigator can get down to the truth without blowing anyone up, and they will protect you from the process.

We often work with CPAs and CFEs as a link in the chain of their unvestigation.  A trained employee fraud investigator from our team will utilize information gathered to lead them through specific interviewing tactics and ultimately interogation techniques if needed to deliver a written confession.  No rubber hoses or scare tactics necessary.

If you have a concern about internal theft and would like to learn more, please visit employee fraud.

Examples of Employee Fraud – Atlanta

A report by the Association of Certified Fraud Examiners published in 2008 stated that $994 billion were lost to employee fraud . Anything from filing a claim for false injury, embezzling funds to falsifying experience on an employment application are examples of this kind of fraud. An employee for Quest Diagnostics stole $1.2 million by filing false expense reports. He set up dummy companies and filed fake invoices for payments he had allegedly made on behalf of his employer. Of course most cases aren’t so extensive. All businesses, large or small, can be susceptible.

In 2007 I came across an appliance salesman for a major retailer. This individual would sell an appliance to a legitimate customer and record the sales transaction. Several weeks later he would ring in a return for the appliance and return the money to the customer. The only problem was there was no customer. The return portion of the transaction was completely false and he would simply pocket the money he should have returned to the customer. When we finally caught him (only because the computers showed that we had a great deal of merchandise on hand that wasn’t actually in the store) he had racked up over $70K in fraudulent returns. A sizable jail sentence followed for the individual, but the company never saw a dime of that money back.

This is the type of employee fraud that most small businesses deal with. People use their particular occupation to misappropriate assets and steal or fraudulently disburse funds. As an employer you want to be able to trust your employees, but as a smart employer you need to be aware of, and look for, red flags. Individuals living beyond their means or experiencing financial difficulties; these are the people most likely to commit employee fraud .

For more information contact us about employee fraud or call 1.770.426.0547 – Atlanta

Case report on employee theft – stealing time

Employee theft is often thought of as merchandise or cash theft, have you considered stealing time as employee theft ?

Store loss prevention personnel found night shift employees were stealing time from a company by taking long breaks.  The company had a policy on stealing time which resulted in the suspension and subsequent firing of eight employees.  Three of the employees claimed they were fired because of race stating a violation of Title VII and 1981 (civil rights act of 1964).

The federal district court found the evidence clearly showed all employees caught sleeping on the job or taking longer than permitted breaks were treated equally regardless of race or age.

What is your company policy on stealing time?  Does it outline it at all?  Ever Considered stealing time as employee theft or employee fraud ? Many readers of this article who own or manage a small  to mid sized business are falling into one of two categories.  First, they have no loos prevention policies and procedures, which is where the time stealing policy would be listed.  Second, those who have written policies are taking notes to be sure and add that to their list.  Those who actually define stealing time in their policies are ahead of the crowd, but is it being enforced? Stealing time may be one of the most common forms of employee theft and most overlooked.

If you need help solving tough issues with employees or want more info visit employee theft.

Internal Theft – An employees guide to misappropriation? Atlanta

I know what you’re thinking? internal theft ? What the heck is that? Boy, if a retailer could really have the luxury of wondering.

Do this, imagine a nice beautiful airplane. You spent lots of money on building her up, beautifying her and are ready to get your customers going. The maiden voyage comes. It’s great. You have a solid customer base, you take on extra airplanes. You’re kicking back, enjoying the fruits of your hard labor when all of a sudden, you get a call. An airplane of yours is falling from the sky. You have a seasoned pilot at the wheel but he can’t control it without immediate and urgent help. You need to react quickly before it’s too late.

That’s kind of an example of what internal theft can do to your business if left unchecked. Employee theft and employee fraud claim millions of dollars each year from retailers and business owners across the country.

A former company I worked for had just that issue. This employee was a well liked and trusted individual. They had worked for this company for 20 + years, had keys to the store and manager level access to all alarms, and access control points.  They could do no wrong.  Merchandise went missing. Thousands of dollars worth. Where was it going? We investigated every single employee in the building. We looked at the receiving process, interviewed vendors. NOTHING! Only one answer, the employee everyone thought was above this. The trusted one.

We went completely black. Spoke with no one other than our immediate supervisors. We conducted surveillance on the long term employee, just 1 day and 1 night. Got him!

I can’t tell you what a relief it was to speak with the store management and corporate staff about the investigation we had just conducted and completed. The disbelief.

I interviewed the suspected employee, who subsequently admitted to over $135,000 in merchandise theft. Internal theft certainly was the case.

Internal theft can come quickly when controls are loosened or lax, be prepared. Never underestimate anyone and always perform due diligence on any investigation to truly uncover the causes of employee theft and employee fraud in your business.

For more information on employee theft or employee fraud in Atlanta please contact us at internal theft or call 1.770.426.0547

Employee Fraud – A sample of Loss Prevention in Atlanta

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

Employee Theft In Atlanta It Cant Happen To Me!?!

I conducted an employee theft investigation here in the Atlanta area recently where our client was hit by a long term Assistant Manager (AM) who stole approximately $48,000 in cash. The AM did this by manipulating the clients accounting systems and POS.

Employee theft which is also referred to as internal theft or white collar crime impacted this client very hard. This person was a trusted individual that had been given quite a bit of authority. In fact the client now realizes that the AM was given too much unchecked authority.

It turns out that the AM has a gambling problem. The owners of the company suspected this. What is concerning is that this did not raise a red flag. When we guide the client through a review of the employee theft investigation once we are done and the employee is on his way to jail the response is almost always the same, “why didn’t I see this? It is so clear now”. The reasons they didn’t see it are many:

They include a desire that we all have to see the best in people.

We do not want to think that a person we hired and like could betray us.

We can get blinders on and do not pay attention because we are “busy”.

We also use personal trust instead of business trust (this person is considered a friend).

Employee theft is not an important part of the business decision-making process.

It boils down to this. If you do not have a loss prevention mindset and consider employee theft something that can’t happen to you then you will experience employee theft or internal theft first hand. Wake up and see what is going on around you. This is not personal it is a business. There are a segment of employees (1 in 10) that WILL commit employee theft in your business.

So what are you doing about it? Do you have a business mind set in loss prevention policy and procedure? Are you making hiring decisions with loss prevention as part of the process? Do you have a loss prevention audit in place (loss prevention audits are designed to expose employee fraud , internal theft , corporate fraud and white collar crime )?

You must have check and balance in your business operations otherwise you will be seeing employee theft up front and personal. If you have blinders on or think it cant happen to me, chances are it is happening to you now.

For more information about employee fraud , internal theft , white collar crime or employee theft investigation in Atlanta contact us about employee fraud or call 1.770.426.0547

Corporate Fraud…The Worker’s Compensation Nightmare In Atlanta

How can people skim money from an Atlanta area corporation? Through corporate fraud involving worker’s compensation claims.  There are three fraud areas that surround worker’s compensation; employee fraud, employer fraud and healthcare provider fraud.  Let’s take a look at each.

Employee fraud usually occurs when an individual working for a company intentionally misrepresents an injury or illness and receives worker’s compensation benefits to which they are not otherwise entitled.  For instance they may claim they have an injury but it either did not occur at the workplace or it never occurred at all.

Employer fraud occurs most often when a business misrepresents information about its work force.  For instance they may under report the number of employees they have in order to receive a lower premium for their workers’ compensation coverage.  Other types of corporate fraud involving the employer can include misrepresenting company ownership or misrepresenting past loss experience.

Healthcare provider fraud is unique in that the provider knowingly and intentionally submits a misrepresentation about medical treatment an employee received in a bill or invoice presented for payment. Corporate fraud of this type also includes billing for exams on patients that never occurred, billing for follow-up exams but listing them as first time exams, or hiding unnecessary services with the necessary ones.

These fraudulent activities cause small businesses to pay a premium for worker’s compensation coverage.  Do you suspect corporate fraud in your business?  Contact us at corporate fraud or call 1.770.426.0547.

Employee Fraud….Cash is King in Atlanta

A study done by the Association of Certified Fraud Examiners titled the 2008 Report to the Nation on Occupational Fraud and Abuse reported that companies with less than 100 workers are “the most vulnerable to fraud and abuse” by employees. Employee fraud is rampant and the number one fraud scheme is embezzlement. This also applies to businesses in Atlanta.

More than 80% of all employee fraud investigations involve some type of embezzlement.  Embezzlement is defined as an employee taking company assets.  What is targeted over 90% of the time? COLD HARD CASH!

The theft of cash is considered direct fraud.  This type of employee fraud is called a cash theft scheme.  Direct fraud means the employee has stolen cash, tools or other assets.  This can also include falsifying purchase orders or invoices and pocketing company funds. This is commonly called fraudulent disbursement of cash.

Indirect fraud can include an employee taking payments from vendors or customers to allow for some sort of advantage, such as lower sales prices.

Many types of fraud schemes can continue for years without detection and cost small businesses millions of dollars.  Unfortunately the report also showed that occupational frauds are much more likely to be detected by a tip from an employee or insider than by audits or any other controls. This is most likely because many companies do not put enough emphasis on auditing as a prevention tool.

If you feel your company or small business is threatened by employee fraud, contact us at employee fraud call 770.426.0547.

The Police & Employee Fraud

Many business owners are under the impression that the Police will conduct investigations into employee fraud. While this may be correct in a few situations. The fact is that most law enforcement agencies are busy. Their caseload is overwhelming, and as a former Police Officer I can tell you that most crimes reported do not get investigated. There is simply not enough officers and budget money to handle it all.

Therefore, if you go to them with a mostly unsolved situation of employee fraud they will take a report but in most situations nothing more will be done. Even if they do take the case on the fact is that very few Detectives know how to investigate employee fraud and theft. That is why the retail industry has Loss Prevention Departments. LP professionals are specialists in this type of investigation. A good LP investigator can conduct the average employee fraud or theft investigation in just a day or two.

After the facts are gathered a good LP investigator will interview the subjects and generally obtain a written admission. After putting the necessary elements of the investigation together a presentation can be made to the Police or Prosecutor.

More about employee fraud investigations, contact us or call 1.770.426.0547