5 Ways a Business can Detect Fraud and Embezzlement

Posted by Lisa Coleman on January 27, 2014


Every business owner should be concerned about the possibility of fraud and embezzlement impacting their company. After all, a single rogue employee could cause extensive damage, especially if their actions are not discovered for an extended period of time. Due to this, you should always take a proactive approach to dealing with this type of issue. The following tips are some ways that a business owner can detect and prevent embezzlement and fraud.

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1. Keep a Close Eye on the Books

It is understandable that major businesses rely on their bookkeepers and accountants to make sure that everything matches up, but this can lead to serious issues. Therefore, you should have random audits conducted on a regular basis to help ensure that no one is skimming off of the top.

2. Limit Access to High Ticket Items

In some instances, high-volume employee theft can be even more damaging than embezzling money. To help avoid this issue, you should severely limit the access that your employees have to any items that are extremely expensive or would be highly valuable to a competitor. Having a sign in sheet is a good way to help keep an eye on each employee's activities when they do need to access these items.

3. Unusual Employee Behavior

You should definitely pay attention to the warning signs if you have an employee being exhibiting unusual behavior such as increased defensiveness and irritability or unwillingness to take a vacation.

4. Missing Deposits or Checks

It is critical for business owners to put strict measures in place to monitor deposits and checks to ensure that none of them go missing. Although it is understandable for the occasional deposit to be slightly off due to human error, this should never begin happening on a regular basis. If it does, someone is stealing money from your company.

5. Duplicate Payments

There are some rare circumstances that might lead to a duplicate payment such as a check getting lost in the mail, but this should never become a regular occurrence. Therefore, you need to keep a close eye on your bill payments for any signs of embezzlement or fraud.

What Type of Legal Penalties can Result?

Every state has harsh penalties for fraud and embezzlement, but the exact legal issues that one of your employees would face after committing one of these crimes will be determined by the state you operate it in. For example, stealing property or money that is valued at less than $500 in Minnesota can lead to up to 90 days in jail and a $1,000 fine. A convicted embezzler who stole more than $35,000 could be sentenced to up to 20 years in prison along with a fine of $100,000.

Due to this, it is imperative for anyone charged with this crime to retain the services of a local professional embezzlement and theft attorney. In the above example, a Minnesota attorney such Kevin W DeVore of www.devorelawoffice.com would be essential. They could help to get them an acquittal or work out a plea bargain that will enable them to avoid jail time.

Ultimately, the best way to protect your business from losing a lot of money or property is to pay close attention to everything. If you suspect that someone is stealing from your company, you should contact a law enforcement officer for assistance.

Lisa Coleman shares some tips on how a business owner can help protect their business from fraud and embezzlement. She recently viewed at www.devorelawoffice.com the serious charges that can accompany such crimes, and how a criminal defense attorney can help.

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