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.
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.
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.
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.
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.
Is there a way to stamp out employee malingering? The answer
Employee malingering is becoming a problem for some employers. As some states move forward with plans to open their states back up during the global COVID-19 pandemic, many are looking forward to life returning to some semblance of normalcy. While businesses make plans to reopen their doors, there are others that will keep the bulk of their operations remote with employees working from home in order to mitigate the spread of the disease. While many employers feel this precaution is still prudent, there is the additional layer of anxiety about whether employees are keeping their noses to the grindstone, or malingering.
Obviously, these are strange times. A majority of businesses
in the United States were forced to shut down direct business to customer
operations in order to prevent the spread of the disease. Employees who were
not furloughed or laid off due to COVID-19 have been forced to adjust to a new
working life devoid of work-life balance—their work is literally in the home—complete
with the distraction of children, family, pets, spouses, and other household
distractions. It is a stressful time, and it can be difficult to maintain focus.
Corporations and organizations should always prioritize their employee’s mental
health for the sake of their corporate culture. These predictable challenges
with suddenly working from home should not be considered employee malingering. However,
willful malingering can lay huge blows to daily productivity and ultimately
profits. Employers must have a way to verify whether or not their employees are
Under more normal, stable circumstances, employers have the
benefit of face to face interaction for determining how engaged and productive
their employees are. In addition to output, supervisors can note how many
breaks they take, the quality of the work, and the level of communication from the
employee, both on and offline. However, remote working has made detecting
employee malingering almost impossible.
Telecommunication technology has played a vital role in facilitating
the continuation of the economy despite the quarantine. Meetings are held over Zoom,
employee time is tracked through invoices or through an online time clock of
sorts that allows employees to log their time worked and have their timesheets
stored on a cloud server. Short of a live camera feed that documents the
employee in front of the computer or on the phone, is there truly a way to
verify if they are actually working?
The idea of hiring a private investigator to surveil your
employees may sound strange or even wrong, but it’s a highly common business
practice that legally exposes the drain an individual employee might be having
on your company. Private investigators can track an employee’s movements during
the time they have invoiced or logged, ensuring that any errands outside the
home are work-related and have some value to the corporation. Private
investigators can document these movements with GPS trackers placed under their
car, photographing their activities in public to either prove or disprove
employee malingering. Private investigators are trained to blend in with their
surroundings, and conduct surveillance discretely to prevent their cover from
being blown, so in the event that no employee malingering is found, no one is
If you suspect your employee is malingering on your dime, reach out to Lauth Investigations International today for a free quote on our surveillance services. Call us at 317-951-1100, or visit our website at lauthinvestigations.com
Employee apathy may seem innocuous enough, but the costs to time and resources can be a slow, devastating drain on a corporation. Many corporations and organizations have at least one employee who exhibits all the major signs of checking out in their daily capacity. Even if your corporation has bulletproofed human resource operations, employee burnout can still occur. That’s why it’s imperative for leadership and management to know and identify the signs of apathy on the part of an employee.
Signs of Employee Apathy
A repeated pattern of tardiness
Poor appearance and hygiene
Complaints about lack of money and/or repeated
attempts to borrow money
Exclusive precedence on their personal life
An excess of breaks
Appearance of being busy with nothing to show
Lack of accountability, making excuses
Irrelevant preoccupation with cell phones, smart
It stands to reason that if an employee is underperforming
at their job, leadership will cut the dead weight for the good of a
corporation. There are actually three umbrella categories that are often used
to justify retaining apathetic employees: Costs, Litigation, and Personal.
The first thing leadership will think of when they notice
an apathetic employee is dollar signs. Not only is the apathetic employee hemorrhaging
their money by wasting time and resources, but the cost to replace that
apathetic employee can also be an issue. Costs are incurred to the human
resources department to find, hire, and train a replacement. Employers might
hesitate to fire an apathetic employee because of unemployment insurance rates.
Another relevant factor specifically effects small businesses, in which the
workforce is not large enough to support turnover operations.
When it’s not a matter of money, it can often be a matter
of personal feelings or relationships concerning leadership and the apathetic
employee. A manager or owner might have a personal relationship with the
employee, and their bias prevents them from pulling the trigger on termination
procedures. Personal knowledge of that employee’s personal life and their
identity as a person (rather than an employee) can color their perceptions and
increase their latitude with the employee. Avoidance behavior can also play a
role. When this happens, leadership usually resigns itself to one of two end results:
Either the employee will improve on their own without intervention from
leadership, or they will leave on their own without termination proceedings.
The independent judgement of leadership may not be the
sticking point in terminating an apathetic employee. There are often legal factors
that a corporation or organization must consider. For instance, the Age
Discrimination in Employment Act (AEDA) protects employees from being
terminated based on their age. If an apathetic employee is of a certain age,
leadership may fear legal retaliation, citing age discrimination as the reason
for their termination. In higher education, an employee may have tenure as defined
by the institution, which would prevent leadership from terminating them.
Risks in Retention
Retaining apathetic employees for any of the reasons
listed above can have serious consequences for a company who is avoiding the
issue or trying to save money. Apathetic/underperforming employees cannot
provide a customer base with quality service, leading to dissatisfaction and
consumer complaints. This can negatively impact the corporation’s brand or
campaign, with a high risk of human error, loss of valued customers, and lost
reputation. Disgruntled employees could potentially say negative things about the
corporation on their social media accounts. Perhaps most concerning, apathetic
employees can easily spread their attitude throughout a work force, and harm long-term
goals for the corporation.
Corporate Culture Audits
One apathetic employee is enough of a drain on company time and resources, but if that attitude is contagious, you could have a larger problem on your hands. Unfortunately, when it comes to employee morale and performance, you don’t know what you don’t know. That’s why so many corporations and organizations are investing in quarterly or even biannual corporate culture audits. With a corporate culture audit, an independent, third party firm, like a private investigator or security company, conducts a full overview of company operations, structure, and environment in order to identify problems at their source for the health of the corporation. With a corporate culture audit, leadership will be able to identify factors that might be contributing to employee apathy.
What is a corporate crisis? While exact definitions may differ, a corporate crisis is generally defined as “an event, situation, or public initiative that threatens the company’s ability to effectively operate its business. A crisis can escalate into a disaster or long-term impediment to business growth if not handled with efficiency and sensitivity to all involved.” This is a large umbrella that encompasses many of the internal issues we associate with companies, including (but not limited to) fraud, theft, misconduct, and harassment of all kinds.
A majority of corporate crises fall into one of three categories: personnel, systemic, and contextual.
A personnel crisis is an internal issue that is a direct result of an individual employee or a group of employees’ bad behavior. Theft by personnel is one of the most widely-reported crises in corporations throughout America. The scope of this problem can be as small as stealing office supplies all the way up to executive embezzlement. Sexual harassment is a type of personnel crisis receiving a welcomed new level of attention in corporations. In the age of the #MeToo movement, corporations are viewing their workforce very differently when it comes to identifying potential predators in their midst in the name of a “pound of cure.” Prudent steps taken when vetting potential hires and current employees has saved companies difficulties down the line, especially in legal fees and public relations.
A systemic crisis refers to a major breakdown in operations negatively impacting business. A common example is food service corporations that receive a sudden influx of food poisoning complaints. Source of the outbreak may be traced back to how the supplier or distributor handled the food product, and suddenly, there’s a systemic crisis: A misstep in operations led to a large sum of incidents. Systemic problems manifest themselves in many forms, including external theft. Repeated theft, both in cyberspace and the real world, is often the result of insufficient security within a company. Consequently, the company incurs loss because they remain vulnerable. Companies who have chronic turnover due to employee misconduct may have flaws in their vetting system for potential employees. That is another example of a crucial operation where a breakdown occurs and erodes a company’s profits with labor hours to hire a new individual to fill a vacant position.
A contextual crisis has exponential consequences for a business relative to its size. These are the types of crises that companies cannot anticipate, because they influence public perception of their brand based on real-life events. A major news story like a mass shooting, or a major criminal case, or a lawsuit, can negatively impact a brand even if that event is not directly associated with that company. These external events can drastically change a company’s internal operations, and can weigh heavy on employees at every level. Sexual harassment is another example of this type of crisis in motion. The media coverage regarding high-level Hollywood executives like Harvey Weinstein and his alleged history of abuse have executives in companies of all shapes and sizes revisiting their human resource policies and practices when it comes to addressing sexual misconduct in the workplace. Internal operations receive a major overhaul to the benefit of a healthier work environment for everyone.
When it comes to corporate crises, not all businesses will be able to afford specialized investigators to work in-house to resolve issues that arise. Even if they can afford these professionals, investigators employed by the company—regardless of the quality of their work—by definition cannot provide a truly objective solution to any problem. Because they’re employed by the corporation, they have a potential stake in the outcome of the investigation, whether that stake be real or perceived. Hiring an independent professional, like a licensed private investigator, to conduct an external investigation is the best way to ensure that the solution is objective. This is particularly important personnel crises, because terminating personnel based on an unbiased investigation is kerosene for a disgruntled employee that can manifest itself with many devastating consequences—most commonly wrongful termination lawsuits. Private investigators can assist in systemic crises as well, like the example of repeated thefts with regards to security. Private investigators who specialize in different kinds of risk assessment can identify a company’s vulnerabilities to thieves and scammers, and provide them with a game plan to improve their security.
If your business has encountered a corporate crisis, call Lauth Investigations International today for a free consultation. Learn how we can provide you with an objective solution to your corporate crisis. Call 317-951-1100, or learn more about our services here.