Difficult Economy Equals More Employee Theft

employee background checkCrime statistics show that thefts and burglaries increase during difficult economic times. So it makes sense that employee theft would increase as well. The news is filled with stories like the one from Minneapolis of a man who stole nearly $1 million from his employer, a wrecker company. It took him four years, but he managed to embezzle over $933,000 by cashing checks made out to the business or to vendors.

Theft is not always in the form of cash—but it can cost businesses plenty of that, too. Two Starwood Hotel executives stole information about its brand and used it to develop a competing hotel. Over 10,000 electronic and hard-copy files were stolen in this case, which resulted in a lawsuit against the competitor as well as the two employees.

Even your coffee server could be skimming money from her employer. One Dunkin’ Donuts employee admitted to ringing up sales for less, taking the full amount from the customer, and pocketing the difference. The woman claimed that it was in retaliation for having her hours cut due to the recession. She’s never been caught, although it seems like a few safeguards would make that easy. Requiring receipts would show customers that they are paying $2.00 for a coffee that’s being entered at $1.50. And keeping inventory on coffee cups, comparing them to sales by size, would indicate a discrepancy between what’s being entered on the cash register and what’s going out the door.

Most employers avoid the attention and bad publicity of employee-theft cases, so they don’t always prosecute—which only serves to prevent future employers from knowing the full criminal history on the thief.

Employee theft can happen anywhere, whether your business is “like a family” or a large, more corporate environment. School employees and coaches. Cashiers. Managers. Law firm assistants. Police records are full of scenarios where employers “can’t believe” an employee would steal from them.

The best way to prevent employee theft is to know whom you are hiring. And the best way to know that is to conduct thorough, professional background screening on every potential employee. You’ll know whether they are living among their means with a credit check and whether they have a criminal history with a criminal background check. Even whether they move around a lot to avoid paying back rent, or have evictions on their records—putting together a complete picture of a potential employee is one excellent means of stopping employee theft before it happens to you—especially in this economy.

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