The Urgent Step To Take When Navigating Corporate Theft

The Urgent Step To Take When Navigating Corporate Theft

by | Apr 13, 2022 | Corporate Theft

When evidence points to the unpleasant reality that someone has targeted your organization, it’s not the time to bury your head in the sand. From a cybersecurity threat to white collar crime; from fraud or extortion to a physical break-in: it’s safe to assume that the violation in question isn’t an isolated incident. You’re going to need to take immediate steps to plug leaks, remove vulnerabilities, beef up securities, and assess the damage that has been done. Crucially, it’s time to call a corporate theft investigator, and there isn’t a minute to lose. Corporate theft investigations are the first step in getting to the bottom of the problem.

  1. The Many Faces Of Corporate Theft

Corporate theft comes in many guises, and business leaders should be mindful of all of them. The assets that bad actors might target include physical inventory, financial assets, intellectual property, and more. The actors themselves could be members of your team on any level—making the issue one of internal corporate theft—or supposedly trustworthy business partners, suppliers, or clients who have been granted just enough access to do harm. Finally, it might be an outsider with the wherewithal to bypass your security entirely—denoting external corporate theft. 

Complicating matters, those doing the stealing will likely bend over backwards to cover their tracks—so when a workplace investigation is called for, you’ll want to be prepared that it might uncover a rot that has festered. The good news is that a seasoned corporate investigator will not only be able to reveal the extent of nefarious actions, but advise on the steps to take next in the name of damage control and recovery. Whether they collaborate with your HR investigator or take full control of theft-related HR investigations, you can be confident that any threat will be effectively neutralised, allowing you to pursue justice and ultimately get back to what you do best.

  1. Hiring a Corporate Investigator

Discovering that your business has fallen prey to corporate theft can leave many executives in a tailspin. Thoughts of reputational damage, rifts with shareholders, or potential legal ramifications are certainly daunting. However, this is where the tactic of hiring a corporate investigation firm for expert assistance comes into its own. 

The dedicated workplace investigator is an expert at discreetly navigating exceptionally sensitive issues of this nature, and will act swiftly to resolve the challenge at hand while maintaining utmost confidence. The corporate investigation process can take place with minimal disruption to your team and daily operations, with information shared on a strictly need-to-know basis and conclusions kept under wraps until you have a concrete plan of action in place. Of course, the corporate investigator is also well versed at collaborating with law enforcement and will ensure that your company’s actions are compliant, ethical, and legally air-tight as workplace investigations progress.

  1. How To Prevent Corporate Theft

Undoubtedly, any business owner would rather never face the need for corporate theft investigations. So how can corporate investigation services help you lessen the risk in the first place? Well, diligent background checks on recruits and business partners is a great place to start. Gathering corporate intelligence can help you guard against non-compete violations and intellectual property theft. Meanwhile, periodic corporate culture audits can help you forge an environment where employees are far less likely to feel disgruntled enough to act against the company in the first place.
Here at Lauth Investigations International, our expert corporate division offers all of the corporate investigation examples that you may require—making hiring a corporate investigator for your company’s unique needs easy and simple to do. With the right ally in your corner, navigating corporate theft doesn’t need to be daunting. As ominous as such an occurrence may be, you can rest easy that the right actions are being taken on your behalf. If you’re ready to show active or potential perpetrators that yours is not the business to mess with, we’re ready to stand by your side. Contact the team to get started today.

Don’t Let Former Employees Violate Non-Competes

Don’t Let Former Employees Violate Non-Competes

by | Sep 15, 2021 | Corporate Theft

Corporate entities and organizations the world over go to great lengths to protect their intellectual property and self-built foundations of knowledge. In this vein, contracts that protect against non-compete violations allow employers to invest in developing the skill set of their employees without fear that they will turn around and take a pay-off from a competitor, or even set up shop offering the exact same service up the street.

The repercussions when a non-compete contract is breached can be costly and complex to navigate. This means that taking every step to mitigate violations is prudent planning. With that in mind, read on to discover Lauth Investigation’s top tips for minimizing the risk of non-compete violations—and what to do if you suspect something underhand is already afoot.

Keeping Non-Compete Contracts up to Date

Laws change, roles change, and the needs of any given business will inevitably change too. Ensuring that non-competes remain practical and legally applicable can help you avoid future vulnerability. Because of the unique nature of each organization’s operation and each employees role, non-competes must be tailor made.

Factors such as locational jurisdictions, business or asset acquisitions, and what is considered an industry-specific reasonable duration of contract must all be taken into account. In contrast, a cookie-cutter approach to non-compete contracts can be risky, as any strategic holes may disincline the courts from upholding the contract in question. Also keep in mind that—when updating non-competes for current employees—it is vital to ensure a consideration is provided in return for their renewed agreement.

Ensuring Security Is Locked Down

Even with the most air-tight non-compete agreements in place, the risk always remains that an employee will decide that breaching their contract is worth the consequences. Temptation to accept a bribe in return for providing access to computer systems, documents, or designs is always a possibility. One of the ways in which companies can reduce this risk is by making security a top priority. Having electronic and on-site security provisions regularly reviewed—and making employees aware of both measures in place and their own responsibility—can be a reminder that they risk getting caught in the act when temptation strikes.

Staying on Top of Corporate Culture

A thriving corporate culture not only means satisfied employees and larger profits, but also enhanced company loyalty. In contrast, when toxic corporate culture is allowed to fester, organizations run the risk of their employees feeling far more inclined to turn on the hand that feeds them. Diligently monitoring the health of workplace culture offers multi-faceted protection. If tackling corporate culture for the first time, a Corporate Culture Audit can be a great place to start.

Being Proactive When Employment Ends

When an employee quits or is terminated, an exit interview provides the perfect opportunity for a non-compete refresher. Reminding of ongoing legal obligations can ensure that former employees are clear on the legal repercussions if they choose to breach their contract. It also provides an opportunity for them to disclose their intention to work for a competitive company—the omission of which may impact their credibility if a non-compete violation occurs in the future.

Reaching Out to a Competitive Employer

When a former employee does go to work for a competitor, the prior employer may request their consent to inform the new employer of the standing non-compete contract. Equally, if suspicion is growing, the prior employer may decide to reach out independently to ensure that the competitive business is aware that legal obligations are in play. In such instances, swift action can minimize damage.

Safeguarding Client Relationships

When valuable clients are involved and concerns exist that a former employee may not have positive intentions, proactive protection of customer relationships can be vital. Informing customers that the former employee in question is no longer working for the company and immediately connecting them with new representatives can reduce the risk of client theft and non-compete violations.

When You Suspect a Non-Compete Violation

When it comes to non-compete violations, time is usually of the essence. Swift action can effectively minimize both financial and reputational losses, while reducing the potential complexity of litigation. When suspicion arises, a skilled private investigator can be an ultimate ally—launching diligent corporate investigations, carrying out surveillance, and information gathering—as they build a case that will allow you to take immediate action. If a possible non-compete violation is on your radar or you require help in assessing your current level of risk, contact Lauth Investigations for immediate assistance.

Find the Thief in Your Business with a Private Investigator

Find the Thief in Your Business with a Private Investigator

by | Jul 29, 2021 | Corporate Investigations, Corporate Theft, Corporate Theft Evergreen

A private investigator can identify employee fraud and thief in your workforce, eliminating future threats while maintaining objectivity.

Despite the ability of a business to flourish in any economy, every company is still vulnerable to the possibility of employee theft or fraud. Like a frog in a boiling pot, sometimes companies can be taken by surprise when the theft has gradually grown over a period of time, and no one is the wiser until the business takes an unexpected financial hit. Companies can protect themselves from these frauds with costly in-house investigations into the crime, but a private investigator can go a long way towards identifying all perpetrators, no matter how high up the chain of command it goes.

Recent statistics from several government agencies who supervise finances and labor estimate theft committed annually by employees reaches an excess of $50 billion. Even an isolated incident can blanket a company in a crisis and leave them clawing out of the depths of bankruptcy. It starts with small things, such as taking office supplies for personal use. When this action goes unchecked, the employee might begin taking from petty cash without authorization. The level of the theft will always ratchet up the longer the thief goes undetected.

When an investigator attempts to identify employee fraud is knowing what to look for. Elliot Rysenbry of Trustify says there are six warning signs of employee theft for which Human Resources should be vigilant.

  • Workaholics
    • Behaviors of people who might be very dedicated to their jobs are also characteristic of people who might be stealing from your business. People who are always working long hours and never take a vacation. This “dedication” is a front for superiors. People who are stealing via their position do not want to be absent from the workplace for fear a temporary replacement might notice inconsistencies that could indicate fraud.
  • Hyper-vigilance of connections
    • When an employee has a close personal connection/relationship with any vendor or associated financial institution, it’s usually not cause for concern of impropriety. However, hyper-vigilance or strong protection of those relationships, it’s possible there’s something in the business arrangement for this employee. One of the most common names for this kind of fraudulent arrangement is “kickbacks” or getting a cut of the profits vendors or financial institutions receive from a thieving employee.
  • Inflated expenses
    • This is one of the most common types of theft committed in the workplace. Line items on expense reports are either inflated or fabricated entirely in order to pad the thief’s pocket.
  • Extravagances
    • Payroll knows what individual employees make week to week, so when there are unexplained extravagences in an employee’s life, such as a flashy new car, it’s important HR keep an eye on said employee.
  • Frequent small transactions
    • Taking from petty cash in small amounts can add up quickly, and is often a sign of more serious, larger-scale fraud being committed within the company.
  • Entitlement
    • Employees who feel as though they are underpaid or undervalued at their company are also plausible perpetrators of theft. Whether as a motive or a rationalization, they feel as if what they stole was deserved payment.

While theft can be an extremely toxic element in any work environment, one of the ways to exacerbate it is by conducting a poor internal investigation. Human Resource employees are unsung heroes of companies and businesses, as they are one of the crucial gatekeepers with control over the quality of employees. Not only are they very busy individuals, but they might not be the most objective persons to conduct an internal investigation.

Sometimes a lack of experience with investigations will cause a member of HR to make false or unprepared accusations about the guilt of a particular employee. If this employee is unimpeachable, the company can open itself up to lawsuits and bad press. Even if HR is not conducting the investigation, most employees are not trained investigators and might conduct an inquiry in an illegal manner that could also open the business up to litigation. Sometimes a pay cut for an employee suspected of stealing might seem like a quick and quiet way to resolve these issues, but legal counsel should always be consulted before making these decisions. By the same token, hasty termination of these employees to avoid a messy investigation should always involve the opinion of a legal expert—all in the name of protecting the country from plausible legal trouble.

The simple answer to avoiding all of the aforementioned ways to inflame an internal theft investigation is to retain the services of a private investigator. Private investigators can save companies from themselves in terms of opening themselves up to litigation or bad press. Private investigators have more skill and experience in these areas preventing investigations from blowing up in a negative manner. They are independent contractors, therefore, do not have a dog in the race when it comes to identifying the culprit of the theft. Their objectivity will be crucial, especially if the theft within the company goes all the way to the executive level. Because of their authority over employees, CEOs of companies might often get a soft front from HR or other investigative bodies within the business. Private investigators—being unknown to other employees in the business—can also conduct undercover operations to yield truthful and unbiased results. The private investigator, along with business counsel, can also advise Human Resource departments how to proceed once the culprit has been identified. Whatever the specific needs of a company, always consider hiring a private investigator to conduct internal investigations in order to protect and enhance the longevity of your business.

Identify employee fraud and theft today with Lauth Investigations International. Call 317-951-1100 or visit us online at our website for a free quote.

Corporate Theft | Oil Manufacturer

Corporate Theft | Oil Manufacturer

by | Mar 8, 2020 | Case Studies, Case Study Corporate Theft, Corporate Theft

Case Study | Corporate Theft | Oil Manufacturer | 

Employees are the fuel that drive success in a company, but what happens when employee theft stalls the corporate engine?

Corporate Theft | The Case

Employees are the fuel that drive success in a company, but what happens when employee theft stalls the corporate engine?

Lauth Investigations International was called upon to investigate suspicions of theft within a local oil manufacturer. An equipment manager had voiced concerns about unusual gas spillage near the valves where employees filled the tanks for distribution. The manger told their superiors they believed an employee had been siphoning off gas from the refinery and had been selling it out of his home.

The Investigation

Lauth Investigators first had to determine if there were environmental factors that were effecting the valves. 

Lauth Investigators first had to determine if there were environmental factors that were effecting the valves. Using risk-management criteria, it was determined that there were no leaks in the valves and they were in perfect working order. Next, investigators had to determine if human error might have been responsible for the spillage. Procedure for filling gas tanks involved the use of a hose which would prevent spillage. Undercover, investigators entered the refinery during operation hours to observe employees filling tanks. After surveilling daily operations, it was determined the alleged theft must be taking place outside of operation hours. Investigators placed hidden cameras trained on the target tanks in hopes of observing the theft. Footage from the hidden surveillance cameras revealed that an employee was, in fact, using an improper technique to fill cannisters with gas from the targeted tanks. The investigator visited the Subject’s residence and identified the same gas cannisters on the Subject’s property.

The Solution

Lauth prepared a report indicating that the Subject identified filling gas from the cannisters was the suspected employee, as well as the gas cannisters observed at the Subject’s home.

The report contained the conclusion that the Subject was siphoning gas and transporting it back to their residence to sell privately. At this stage of the investigation, the client did not wish to go further with the investigation in order to establish a link between the improperly filled cannisters and the cannisters at the Subject’s home. Lauth’s recommended solution was the termination of the employee.

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On the Line: Exposing Theft in Manufacturing

On the Line: Exposing Theft in Manufacturing

by | Jan 10, 2019 | Corporate Investigations, Corporate Theft, Corporate Theft Evergreen, Criminal Investigation, Theft

On the Line: Exposing Theft in Manufacturing

When your business is in manufacturing, you are the steam engine on a locomotive of consumer progress. Product quality and efficiency start with you—producing the best results so the next link in the chain has a reasonable chance of success. This means hiring the best people to work in your plant is paramount to clearing the black. Human Resource departments dedicate themselves to recruiting the best of the best for their company, but even the most qualified and dependable candidates can give you ugly surprises with dishonest behavior, including malingering, fraud, and most significantly, theft.

All industries experience internal theft lowering their profits, but manufacturing is one of those most heavily affected. The Association of Certified Fraud Examiners (ACFE) has reported in global industries, internal theft accounts for more than $3.7 million of eroded profits every year. The ACFE has determined, for manufacturing and production industries, the median loss is $194,000 per company.  There’s no short of manufacturing industries who suffer this loss, but to a thief, some are more lucrative than others. The top five manufacturing targets of thieves are pharmaceutical, metal, cargo, electronics, and cigarettes. The opioid crisis in the United States is not only responsible for millions of dollars of theft in pharmacies, but also in the plants where drugs are manufactured, or the warehouses where they are stored. Warehouse and plant workers often swipe units of electronics and fabrication materials for use in their own homes. These items can go for a small fortune on the street, or they can be resold on the black market to avoid being traced.

The larger the theft, the quicker it is noticed, but no company should have to wait for a large loss to implement prevention strategies. Any high-ranking employee or human resources employee can recognize the signs of internal theft, if they know where to look. For example, employees might report recent loss, or seeing product in unauthorized locations. Employees may be exhibiting suspicious behavior, like repeated rendezvous in the parking lot, or the surrounding area. Outlandish material possessions, such as new cars, designer shoes, and expensive jewelry, might suddenly be a regular part of the employee’s life. Low morale is one of the most common causes of internal theft, as employees who feel undervalued suddenly rationalize to themselves they deserve to take something from the company for their hard work and sacrifice.

manufacturing theftAs such, human resource departments are always reshaping their recruitment process to ensure they hire only quality individuals to be a part of their team. And this goes for all ranks within a workforce.  While a lower-level employee may not be noticed themselves, higher-level employees are the ones poised to cause significant loss to the company with their status and access to important company records. When everyone is a suspect, HR must implement procedures and methods of prevention that not only educate employees on the warning signs of theft, but also craft a culture that promotes honesty—if you see something, say something. These preemptive measures can be things like a comprehensive employee handbook, specific training to recognize signs of theft, effective security and monitoring systems, and a confidential tip line so that employees can report suspicious behavior without fear of reprisal. In manufacturing industries where groups of employees are assigned to their own sections, it’s important to have regular team meetings to maintain contact with the workforce so policies to protect the company can be reviewed and modified to improve and protect daily operations.

However, despite having a plethora of prevention methods in place, bad apples can still slip through the cracks of due diligence. When all attempts to handle a theft in-house have failed, there is still recourse. Many companies feel the need to handle all matters of theft internally, using teams of Human Resource employees or their own in-house investigator, but in-house operatives often lack the cohesive experience that comes from working in private investigations. The initial instinct might be to use an informal, in-house operative. Unfortunately, using an in-house operative has the potential to backfire quickly. If this investigator is known to the company’s workforce, their undercover efforts to sus out the culprit can be exposed easily, allowing the perpetrator to modify their methods, or disappear entirely before being identified. Poor investigations cannot only leave the perpetrator with an out, but can also exacerbate a workforce’s low morale, as employees become suspicious and paranoid.

Hiring a private investigator to investigate an internal theft has a wealth of benefits for business owners. Most obviously, an external, third-party investigator will be a fresh, unknown face to a company’s workforce. This “new blood” can freely move about the company inconspicuously. Their new hire status coupled with expertise in interviewing subjects will allow them to question other employees without suspicion. Private investigators also have a better chance of thoroughly investigating middle to higher management. As previously stated, these are the employees with the most access—able to alter inventory sheets and cost analyses. Over a period of time, a private investigator can hide in plain sight, keeping meticulous records on conversations and reporting surveillance findings that can be cataloged for any terminations resulting from the investigation.

manufacturing theftTerminations under messy circumstances like internal theft can often have legal repercussions, on both the side of the employer and employee. Companies may feel inclined to prosecute for the losses to the company, or an employee who feels they were wrongly terminated may sue. Internal investigators who have improperly handled an investigation can be the lynch pin that brings any legal proceedings to its knees. Improperly gathered evidence or illegal methods of fact-finding will compromise the company and their position in terminating the employee. Terminated employees can argue the company fired the wrong person in the interest of finding a solution, or argue the termination is vindictive action. However, an external operative like a private investigator has no stakes in the outcome of any investigation. Their only loyalty is to the truth, and as such, their investigation is dependent on facts, not company politics. Private investigators are impartial third-parties, which leaves very little room for a thief to argue wrongful-termination.

When producing a quality product, the integrity begins in manufacturing. Regardless of the type of product being manufactured, theft at this level of production is profitable to an organized thief—especially one who knows how to cover their tracks. Keeping the investigation in-house certainly has public relations benefits, but ultimately, one of the tenets of quality private investigations is confidentiality. Confidentiality between a private investigator and a company will allow them to deal with the theft discreetly, but thoroughly. Their third-party status means they have no dog in the fight, and their solution will stand up to the highest level of scrutiny.

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