Stealing from your employer is literally akin to biting the hand that feeds you — hard. Yet, employees embezzle all the time — and small businesses are particularly susceptible to fraud.
So, what exactly drives employees to steal? There’s actually a well-known triad of factors behind most cases of fraud in the workplace:
- Opportunity. The thief has the ability and means to take the money — usually because of a lack of internal controls.
- Pressure. Sometimes, there’s financial pressure at home due to a sick spouse, a kid in college or a secret gambling addiction.
- Rationalization. The thief may try to justify stealing because he or she doesn’t feel appreciated or paid enough — or, maybe, the thief will convince himself or herself that the money can be put back later without anyone noticing.
How do you prevent thefts in the workplace? Well, you start by identifying who is most likely to embezzle.
Is it the young hotshot who just started working for you? Should you be suspicious because he’s obviously still struggling to make ends meet on a starter salary?
Probably not. Your real concern might be the woman in her late forties who has worked with you for years. She controls the back office with an iron fist and has access to everything — and you trust her implicitly. The majority of embezzlers are older, female and well-trusted by their employers — simply because they’re the ones who have the most opportunity to make a grab for the money.
The red flags that can alert you to a potential embezzler aren’t always obvious — you may not realize an employee is having financial problems or living beyond their means if they’re closed-mouthed about their problems. However, you can take steps to reduce the possibility of workplace fraud by instituting checks and balances in all your systems. No one should have unfettered control over payments, checks or even petty cash without some sort of oversight — no matter how well you trust them.
If you have been the victim of embezzlement, you may have a multitude of legal problems that need to be addressed as a result. Talk to an attorney with experience handling business torts as soon as practical to protect your interests — and your company.