Small business owners try their best to hire trustworthy employees: they interview candidates, check their credit history, and sometimes even conduct criminal background checks. Despite all this, you may discover that one of your employees is stealing supplies, products, equipment, or even money from your business. Employee theft can be stealing of inventory, currency, fixed assets or it can be related to fraud, forgery, or embezzlement. While some incidents may involve a small amount of petty cash, others can be a complex, far-reaching scheme involving significant funds. Either way, employee theft is a crime, and must be dealt with as such.
Here are three of the most important things to do if you discover small business employee theft in your workplace:
1) Notify the police. First and foremost, you’ll want to get the police involved. Law enforcement will need to know the amount of the loss and evidence of the crime. Keep in mind, that the main goal of law enforcement is to arrest the perpetrator, rather than get your property or funds back. Be aware that you and possibly other employees will need to provide statements. If the employee theft didn’t involve a violent crime, keep in mind that the investigation may take a few months to resolve.
2) Notify your attorney. You may be able to seek restitution under the criminal justice system so work with a lawyer on the investigation of the theft. Depending on the nature of the crime, your attorney may recommend utilizing the services of a forensic accountant. This type of specialized financial investigator uses sophisticated techniques to obtain information on the thief’s bank account, property, and other assets, to file an order to seize them.
3) Notify your insurance company. Hopefully, you haver insurance coverage for employee theft, such as an employee dishonesty policy, fidelity bond, or other business insurance policy that covers employee theft or embezzlement. If so, you may be able to recover a portion of your loss, and will need to file a claim right away. If you are not sure whether you have coverage for employee theft or embezzlement, talk with your insurer to see where you stand on this risk.
If your small business have discovered small business employee theft in your workplace, your initial reaction may be one of disbelief and despair. However, taking the right and immediate action can mean the difference between expeditiously recovering your losses or being in the midst of years of turmoil. By notifying law enforcement, your attorney, and your insurance company right away, you stand a better chance of recouping your losses more quickly and the crime being prosecuted.