But I TRUSTED (her/him) - What HAPPENED?
Sunday, May 06, 2018
Sometimes it's petty theft, sometimes it's missing office supplies, missing cash from the cash box, using company postage for personal mailings, inflating the expense report.
But sometimes IT'S BIG! When you have an employee stealing from you, chances are you won't notice for a long, long time. And chances are, it's the "trusted employee", the long-time employee, the one who's found a way to beat your system. They're the employee you'd least suspect, so he/she is the one with the easiest path to steal - unnoticed.
Small businesses and nonprofits are particularly vulnerable, because they typically don't have adequate controls in place to prevent or detect offenses. Check this link for an interesting (and scary!) article about white collar theft (by Melissa Hillebrand, written for PropertyCasualty360).
Do you have Employee Dishonesty insurance? Many insurance "package" policies include a small amount of coverage - maybe $10 - $25,000. Do you realize many embezzlements at small firms go into the hundreds of thousands of dollars? Could your business or nonprofit absorb this kind of shock loss?
- Establish proper in-house procedures - here are 10 steps you can put in place, as recommended by the nonprofit business mentoring group SCORE. We at Insurance121 would add - 1) require 2 signatures on checks, and 2) be sure everyone takes a vacation of at least one week, all at one time, every year. Why you ask? Call us at (916)236-3351.
- Review and update your insurance contract - your fidelity coverage should be taken as seriously as your property insurance, your liability insurance, your vehicle coverage. Talk to us about the coverage you currently carry.
- Keep an open dialogue - encourage others in your shop to speak up if they see something "that just doesn't smell right". And when someone does speak up, be sure to take their concerns seriously, look into the situation, hire outside folks to investigate if need be.
- Report as soon as possible to insurance - your claims people should be brought in as soon as possible, even if you haven't yet established what you've lost.
- Make a police report - for employee dishonesty insurance to kick in, an attempt to prosecute the offender is usually required.
Insurance121 suggests GOING BIG on your fidelity insurance limits. And it may not cost as much as you think to ramp up your protection. Contact Us for a quote. Our phone is (916)236-3351, or use the link provided (in the Message box, write the word THEFT).
What do you think about this as it relates to YOUR business or nonprofit? Tell us YOUR thoughts!