Protecting your business against employee theft

Employees steal from their employers for a variety of complex and at times interconnected reasons. However, one of the most common reasons for an increase in employee theft and fraudulent activity is the general decline in the performance of an economy or uncertainty about the future of a company. To check if your business is prone to employee theft and fraud, consider the following steps:

1. Foster an open and transparent culture where employees feel comfortable reporting suspicious activities because they often know more about what is happening in the company.
2. Ensure clear policies and procedures are in place for financial management, inventory control, and data security.
3. Perform regular financial and operational audits to identify potential vulnerabilities.
4. Cash handling: Monitor cash transactions, such as sales, refunds, and deposits.
5. Inventory management: Keep track of inventory levels, monitor stockroom access, and conduct regular inventory audits.
6. Watch for unusual behaviour, such as sudden changes in lifestyle, dressing, type of schools that they send their children to, excessive overtime, or secretive behaviour by employees.
7. Be honest in terms of paying a living wage to your employees. Be worried if you are paying money that you know is not adequate for one person, but a family man continues coming to work for you.
8. Separation of duties: Divide responsibilities among employees to prevent any one person from having too much control.
9. Conduct thorough background checks on new employees, especially those handling sensitive data or finances.
10. Get Fidelity Guarantee insurance cover so that if the worst occurs, your business will financially recover.

Whilst at times the system of fraud is running from the top office to the guard at the gate; by following these steps, you can identify potential vulnerabilities and take proactive measures to prevent and minimise employee theft and fraud in your business.