I've often been shocked by the brazenness, creativity, and risk-taking of corporate thieves. Having encountered people stealing from the company on numerous occasions, I am reminded of the words of wisdom delivered once by a police sergeant. He said the common element linking corporate criminals was "opportunity." To put an old saying on it's head, "where there is a way, there's a will."

For the manager, the bottom line is -- if you suspect an employee stealing, if you're suspicious an employee might steal, if you can envision a method that an employee may use to steal, or if you have questions about an employee's character -- check for evidence of theft early and often.

And just to get you started, here are six real world examples of instances where I learned an employee had been stealing from my employer.

1. Expense reports. In this incident, a senior executive (of a level far above what I would have normally expected) was padding his expense reports. The problem came to light when he failed to produce a receipt for a hotel room, one where he had supposedly paid cash. He later confessed that he had stayed with a friend, and had simply had a "memory lapse." Investigations into past expense reports showed that he had been falsifying them for months, perhaps years. When confronted, he referenced an incident several years earlier, when he'd received, in his opinion, a substandard raise. Ironically, the amount stolen was less than a percent or two of his salary -- penny wise, pound foolish.

2. Family Ties. At a small, remote operation site, I had a husband and wife team working for me. The husband was in sales, and had a company-issued truck. The wife was our office manager, responsible for, among other things, petty cash. During an audit, we discovered that she had been dispersing cash to her husband daily for "car washes" and duly noting the expenditures in her account book. The only problem was, the truck was not actually being washed. Once again, the amount of the theft was relatively small, and ended up destroying both their careers once uncovered.

3. Physical Theft. This example came from early in my career. At this particular employer, we used forty pound bricks of solder to make one of our products. Every time we did a physical inventory, however, it seemed like we were using more solder than should have been necessary. But who would steal something like solder? Right? As it turned out, security one day found a set of narrow tire tracks running through the snow. The "vehicle" leaving the plant and going out to the back fence, then later returning. As it turned out, a maintenance person was loading up solder a dozen bricks at a time on a three-wheeled bicycle, and riding out to the fence. He would throw the solder over, and collect it in his car after work. That just goes to show you that no theft is too small, and no stolen item's value is too low, to escape targeting by a determined thief.

4. Making a "loan" to himself. In one of the most outrageous examples of theft, a trusted subordinate managed to make a "personal loan" (in excess of twenty thousand dollars) to himself less than a week before quitting to start a competing business. Under threat of prosecution, the thief did sign a promissory note admitting his responsibility to "repay" the money. When his business ultimately failed, however, no remittance was forthcoming.

5. Helped himself to a raise. I've blogged on this incident before, where a new hire in the HR area forged the documents needed to give himself a substantial raise. If it hadn't been for a suspicious corporate employee, this likely would have slipped through the cracks. While the thief never admitted to his crime, it later came to light that he felt he'd done a poor job negotiating his starting salary. Guess he was just planning to "even things up."

6. Creativity counts. In possibly the most complicated case I've ever heard of, a customer service employee created a scheme where she had customers, particularly those who were identified as "cash in advance" accounts, send their payment directly to her. She deposited these payments in her personal bank account, and through a complex sequence of actions, ended up cancelling the orders after goods had been shipped and successfully hiding the ensuing discrepancies. She was eventually caught after failing to intercept a credit memo, which one of these customers attempted to use (and to which he was not entitled, I might add).

By analyzing these six examples, there are several general conclusions I can make about corporate thieves.

Thieves can be found at any level within the organization, male and female.
They usually act alone.
Many rationalize their actions through some "entitlement" argument -- in other words, they feel entitled to what they steal because of some earlier slight, real or imagined.
Most of the schemes are clever, and some were extremely difficult to uncover. Most were discovered only after multiple thefts.
Diligent employees checking out odd discrepancies were the main way this schemes came to light.
Security, checks and balances, and other methods to prevent theft are only speed bumps. If an employee is determined to steal, they will likely find a way. There is no point, however, in making it easy for them.

I'm sure that for every thief my organization caught, many more got away with it. When protecting your organization against theft, there is no substitute for diligent observation and persistence in checking out anomalies. Even then, you probably won't stop all of it. 19.6

The Audacity of Thieves

Tom Spears

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