Common-sense Measures Prevent Employee Theft
Throughout his three years in the accounting department for a company, Sean Davis had been a model employee. Sean insisted on handling any problems or discrepancies personally, and made it clear that the buck stopped with him.
In fact, many bucks did stop with him — followed him home and neatly deposited themselves into his bank account. In three short years, Sean managed to use his authority to bilk the company of nearly $100,000. If janitorial workers had not discovered a suspicious amount of discarded receipts, the theft would have continued undetected.
Is your organization immune to these types of losses? Read on…
Specialists say the cost of employee theft and embezzlement adds up to billions of dollars annually. According to the Association of Certified Fraud Examiners, organizations lose 6 percent of their revenues to dishonesty from within. Security experts estimate that as many as 30 percent of all employees do steal, and that another 60 percent will steal if given sufficient motive and opportunity. With dramatic figures like these, taking steps to eliminate theft and graft within a firm are sure to yield returns. The Small Business Administration offers the following tips to reduce employee theft.
Keep a Closer Eye
Watch for the tell-tale signs of internal theft. One subtle
but noticeable indication of dishonest employees may be an unexplained rise in their living standards.
Pay close attention to management-level personnel who insist on handling routine clerical tasks
themselves. And be on guard for clients complaining about overcharging or inconsistencies
in shipping and billing practices.
Find People You Can Trust
Some employees have theft in mind from the
start. You can weed out some of these people by performing thorough background checks on
all new hire prospects, particularly for sensitive positions involving the flow of money.
Make It Hard to Steal
Even though delegation of tasks is unavoidable,
try to have a management-level supervisor oversee inventory and bookkeeping. If this is not
possible, consider dividing these tasks among several staff members so no single employee
has too much authority. Occasional inspections or audits of inventory and bookkeeping
help in preventing fraud and theft. It is possible to install physical obstacles to theft,
such as alarm systems and secured, restricted areas. However, be aware that such obvious
measures can have a negative effect on morale.
Determine Clear Policies
To reinforce these other measures, a company
should distribute clear, written policies on ethical behavior to be signed by each
employee-including the owner.
Work Together with Employees
Workers will be less likely to steal if you
create an environment in which they think there is a good chance of being caught. Training and
“employee awareness” programs can inform workers about stealing problems and keep
them on the lookout for theft of any kind. To make a security program such as this effective,
it is crucial employees know they can turn over incriminating information on anyone in the firm
without fearing job loss or other repercussions.
Provide Alternatives to Stealing
The most troubling cases of employee theft
occur when workers are in desperate financial straits. Let employees know in advance that they
can come to management for assistance rather than resorting to theft. Employee substance abuse
is intimately linked with financial problems and theft. If your firm does not already have a
procedure for screening workers for drugs or alcohol, it may benefit from one.
Set an Example
Employees need to know that one uniform ethical standard
applies to everyone in the firm. Executives and managers should be positive role models for workers.
