If you’ve watched the news, read a newspaper or glanced at the cover of a magazine recently, you’ve probably seen a report or two on employee theft. You may have even seen some very high profile people accused of committing such a crime. Whether the person is high profile or just your average Joe or Jane one thing is almost always certain, there will be an interview with a shocked and perplexed employer, co-worker, family member, or friend of the now accused. The shocked person will usually defend the accused by saying like; “He’s always been an upstanding/good person. There has got to be a mistake.” As the viewer, do you find yourself wondering how people can be so naive?
We shouldn’t be surprised to find that people defend those they have known for a while. Most of us are guilty of doing the same. Why is this? Because none of us wants to believe that we’re a poor judge of character. Instead, we want to believe that the people we know and hire are they most qualified, best person for the particular position. But even the best person can be guilty of poor judgment, lying or stealing and it happens more often than you may think. Take a look at these statistics on employee crime:
• According to the National Retail Federation, the majority of retail shrinkage is due to employee theft. In 2009 that amounted to just over $14 billion.
• In a survey reported by American Society of Employers 61% of employee theft cases were discovered by accident.
• National estimates state that 75% of all employees steal from their employers at least once during their careers, with 50% of them stealing multiple times. (Source: American Society of Employers)
Experts estimate that the average dollar loss per employee theft case is $1,762. Before you try to reduce employee theft or put loss prevention plans in place, review this list of common theft practices found in the workplace:
1. Resume fraud
2. Inventory or equipment theft and the reselling of those goods
3. Voiding sales and then pocketing the money
4. Falsifying documents in order to embezzle funds
5. Falsifying refunds
6. Gift card fraud
7. Failing to ring up or scan goods for friends or relatives also known as ‘sweethearting.’
8. Fraudulent issuing of checks for compensation (for example, after submitting a false timecard)
9. Fraudulent issuing of checks in a billing scheme (for example, payment of an invoice for goods and services not sold)
10. Padding the expense account
11. Padding the ‘timecard’
While employee theft tends to be higher in companies with higher turnover rates, or higher numbers of part-time employees, hard economic times can also lead to higher employee theft as well. Help keep the money your business earns by using loss preventive security measures and procedures.