Protecting your business, your employees and customers takes a lot of effort, but it can be done when you put the proper tools into place. When it comes to something as serious as employee theft, you want to make sure that you get it right.
From employee theft to fraud risk prevention, here are some great tips that will help you protect yourself and your business better.
Implement fraud risk prevention
Since the first step to dealing with a bad situation is to, well, avoid it, it’s important to take a look at some helpful fraud risk prevention tips that can help keep your company safe from employee theft in the first place.
Install a security system
It’s pretty much impossible to argue with video evidence, so consider putting in security coverage in various places throughout the company’s facility, paying special attention to areas where money, supplies and products are located. It’s important to advise all employees that it’s there to help deter action from occurring. Employees who think that they could get caught on video may not try anything to protect themselves.
It might also be helpful to hire security professionals that walk throughout the building during work hours. This presence will also deter employees from potentially stealing anything if they know that someone is actively watching for it. Obviously, this may depend upon the type of company you have as to whether this would be beneficial.
Regularly change locks and combinations
When it comes to your supplies or files, etc., it’s best to make sure that you regularly change locks and passwords to limit access. For example, after someone is fired, it’s always a good idea to change door or safe combinations used, as well as deactivating login credentials, emails and their passwords. Not only does this mean that you can help fight retaliation after the firing incident, it also means that you are doing your part in staying alert to potential vulnerabilities. Plus, it’s just good policy to change these things on a regular basis to prevent theft from the outside, including hacking and etc.
Make a policy about employee theft as clear as possible
When hiring employees, be clear about the zero-tolerance employee theft policy and what your expectations are, with regard to which parts of the business. If someone who comes to work for you thinks that they can get away with it, they’ll be much more likely to try it. Knowing that you’re watching for it and that you won’t hesitate to follow proper action can help deter even an adventurous or desperate employee from trying anything.
Responding to employee theft
Despite all of these things in play, there are a series of steps that you can take if you suspect employee fraud in your company. It’s important to stress here that you can fight it. You just need to know the right steps to pull yourself out as the winner in this frustrating situation.
Get as much information as possible
Since information is your best friend in a situation like this (which is normally circumstantial or suspected), the more information that you can get on the theft the better.
- Did they steal cash or supplies?
- When did it happen?
- When did you notice it was gone?
- How long as it been going on?
- Who else was around that could have seen something?
The important thing to remember here is that you do not want to let the employee know your suspicions until you have solid evidence to prove it. This prevents you from blaming the wrong employee, of course, and it also can help keep a theft from escalating, too. The more information you can get (especially if there is more than one theft or thieves), the better it will be for pulling together a case. A forensic accountant can help guide you on the type of information to gather, perform an investigation and advise you on a course of action.
Perform a lifestyle analysis
The lifestyle of an employee can often give you a good idea in pointing out theft suspicions. Look at their spending and personal life as it relates to their income. Watch for anyone bragging about expensive vacations or big purchases that don’t line up with their income bracket. This can be a good tip to help you narrow your search.
Put together a means of reporting (“whistle blowers”) after an incident
Getting employees to step forward and share insight with you can help you get information on all sides of the potential theft. Consider having an anonymous tip line or reporting box that allows employees to share information with you without fear of getting identified. This is a good idea in the brink of the moment, but it can also be an example of risk prevention, too, if you keep it up all the time. Most frauds are identified through employee tips, limiting the length of a fraud, and, as a result, the amount of the fraud.
No one wants to find out that they’re dealing with employee theft, but knowing about fraud risk prevention and how to properly respond to it are important to understand when protecting your business. Luckily, you aren’t alone. Palma Financial Consulting can help. We can offer annual or periodic reviews on your procedures or perform a third-party, in-depth investigative analysis, all in efforts to be sure there aren’t any types of fraud or theft going on as well offer various fraud risk prevention suggestions and litigation support. For a free initial consultation, contact us at (281) 668-9168.