Issue link: http://psai.uberflip.com/i/925085
W EEKLY EDITION JAN 10, 2018 Dealing With Employee Theft …continued By PSAI Executive Director Karleen Kos • M a n ip u l at i n g t ra n s ac t i on s such as taking payments from customers and voiding or reversing the sale in the books • C o n d u c ti n g b u s i n e s s o f f t h e b o ok s altogether, such as when a driver manages to add a few units to a worksite – or even drop a unit off for the guy next door -- at a bargain rate as long as they pay him cash you never see • W ri t in g ph o n y o r m an i p u la t e d c h e c ks such as booking an expense to a known vendor for a known amount, but writing the check to "cash" or to a personal creditor and either forging the signature or using a signature stamp/electronic signature D is c o v e ri n g t h e f t . In most cases of employee theft, the evidence is in front of you if you monitor things carefully and manage the operation using "trust but verify" as your approach. Knowing where each and every unit in your inventory is placed, personally viewing cancelled checks – which is so much easier to do in the elec tronic world – and having systems that account for your tools and equipment tend to reduce the opportunity for theft. Still, a really desperate employee dedicated to finding a way around your controls will probably find some way to steal. So you also need to watch for things like: • C h a n g e s i n y o u r c as h f lo w o r bu s in e s s r e s u l t s that don't square with what has been "normal' or what you would have expected. • C h a n g e s i n e m p l oy e e s pe n di n g p at te rn s such as buying a lot of new things, taking trips, or talking about money in new ways. Especially watch this if they are buying/spending on things others in their role can't afford , and they explain it with stories about relatives giving them money, winning at scratch ball or a bet on football, and other "lucky" breaks. A ny of these could happen to someone, but if there's a pattern of unusual luckiness, pay attention. • O t h e r e m pl o ye e s c o mp l ai n i n g ab o u t m is s in g it e m s should be a red flag. Sure, any pen or stapler can go missing – and maybe you don't even care if they do. But if you see a pattern of it, pay attention because following the trail can lead to unexpected discoveries. For example, I once led an organization with 6 locations on a single campus, and everyone was constantly complaining we had no pens. I decided to buy a huge amount of pens in bulk to make sure we had enough. Once the pens were distributed and the excess inventory was stored, I forgot about it until a couple of short months later when everyone was again complaining we were out of pens. Now, pens aren't a big deal until they are. Getting to the bottom of the "Great Pen Shrinkage Caper" taught me some things about how the organization worked – or didn't work – and we had to make some management process changes. We also got the pens back (1000 of them!) and nobody lost their job. Sometimes, you're not so lucky. If I had discovered those pens were being pilfered by one or two specific people and taken off the campus for non - approved purposes, I'd have had to take disciplinary action (at least). PAGE 2 CONTI NUED ON PAGE 3