How to spot embezzlement within your Company

Embezzlement is everyone’s responsibility to stop. It is the job of the business owner and their assigned managers to take care of their staff and ensure that they are happy while upholding the company’s ethics. Although rare, it can be that your employees could take advantage of their position and use it to conduct illegal, financial activity like embezzlement. Here’s what to look out for.

What exactly is embezzlement?

Embezzlement occurs when someone steals or misappropriates money or property from an employer, business partner, or another person who trusted the embezzler with the asset. The embezzler uses their position of trust to take possession of a company asset for themselves. Common examples include padding an expense account, siphoning off cash deposits and falsely claiming a company laptop was lost. Here are some of the usual warning signs.

Missing documents

If an employee is embezzling money, there should be a financial record highlighting that there’s missing cash. Naturally then, an embezzler will attempt to hide this by destroying evidence such as financial documents.

Complaints from paying customers

Paying customers complaining can also be a warning sign. If a large number of customers are being asked multiple times to pay bills, or if they claim they’ve already paid, you could have an embezzler taking money directly from the customer.

Unusual suspicious behaviour

Sometimes things just feel off. Maybe there are some odd transactions to vendors that don’t appear normal. Or perhaps you’ve noticed some unusual cheques around. Alternatively, you might notice suspicious behaviour from an employee.

They might never take time off work in order to conceal their crime. Maybe you have an employee who insists on working on their own to prevent anyone from finding out about their embezzlement. Ultimately, you need to keep a careful eye on behaviour if you suspect something’s not right.

Money disappearing without a trace

This is one of the most obvious signs of embezzlement. If someone needs money fast, it’ll usually be quickly taken from a safe or from the cash register. Reconcile cash balances every day to spot an issue before it gets out of hand.

Action to take

First and foremost, you need to get professional legal advice. By contacting professionals who can help, you’ll be given the best recourse for tackling an embezzlement issue. This will likely give you a chance of recovering any lost assets. Meanwhile, if you’re 100 per cent sure you also have the option of calling law enforcement.

Knowing the warning signs and solutions for embezzlement is key for your business. It’ll help you maintain strong ethics within your company and ensure that it remains efficient.

Simone Ribeiro
Hi! I'm Simone, a citizen of Britain, where I live for over a decade, and of Brazil, where I was born. Midlands Traveller is where I combine my passion for travelling, business and an Eco-friendly lifestyle.

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