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Oversight Is The Most Important Step For Preventing Embezzlement By Staff

Two employees tasked with ordering cellphones stole $562,501 worth of tech products purchased by their employer, sold them, and kept the profits. They recently pled guilty to wire fraud conspiracy.

The employees, who worked at the Center for Toxicology and Environmental Health in North Little Rock, were responsible for ordering new cellphones for employees and subcontractors at the organization. However, they kept the new phones and tablets that they ordered from a contract carrier for themselves rather than turning them over to the organization.

In a plea agreement, the two men admitted to using PayPal and Western Union to sell the devices online. Most of the devices were sent to China via Oregon.

One of the embezzlers was hired in June 2007 as the internet technology infrastructure and facilities specialist. The other was hired in Sept. 2011 as a LAN/desktop specialist. The scheme went on from June 2013 until November 2017, when both of the men were terminated.

One of the former employees was sentenced to 18 months in federal prison and $562,501 in restitution. The other former employee is awaiting sentencing. Linda Satter "Ex-internet tech specialist gets 18-month sentence in fraud case" arkansasonline.com (Sep. 12, 2020).

Commentary and Checklist

Always review payments and purchases to make sure that services were actually performed and items were actually received by the family. Monitor your financial accounts and hire an auditor to conduct an investigation if anything does not appear correct. Work with an independent, third party auditor to routinely examine receipts and financial records for signs of fraud. Do not trust total financial oversight to a single manager.

Some signs that a staff member may be stealing from you include: 

•      Never taking vacations or sick days.

•      Trying to keep coworkers and managers out of his or her workspace or being overly protective of his or her work.

•      Frequently requesting to work from home or during hours most other staff are away.

•      Seeking to work without supervision.

•      Financial records disappearing or seeming to have been modified.

•      Sudden unexplained changes in behavior.

•      Always coming in early or staying late.

•      Owing expensive possessions beyond his or her income level.

•      Inquiring about information that is not necessary to perform his or her job.

•      Certain customers or clients only working with that staff member and refusing to work with anyone else.

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