THEFT

Employee theft is defined as any stealing, use or misuse of an employer’s assets without permission. The term employer’s assets are important because it implies that employee theft involves more than just cash. In many industries, there are much more important things than cash that employees can steal from a company. Below are some of the different assets that employees normally steal from their employers:
– Money – the most common asset stolen from employers.
– Time – Occurs when an employee is paid for time that he/she did not work. This usually happens through falsifying time keeping records, or when employees are not working while on the job (although difficult to prove).
– Supplies – Common examples of theft of supplies include office supplies (paper, pens, computers, etc.) and restaurant supplies (food, condiments, silverware, etc.).
– Merchandise/Company Property – Theft of products that are to be sold.
– Information – Stealing product designs and trade secrets.

a) Larceny or embezzlement: The taking of money or property with the intent to defraud the rightful owner.
b) Skimming: Theft of money before it has been recorded, such as an employee taking money for a sale and not ringing the sale into the cash register
c) Fraudulent disbursements: This includes things like check tampering, payroll schemes, and expense reimbursement scams; essentially, it’s using a company’s internal processes for personal gain.

a) Operational Risks
The damage done by employee theft is the cause of nearly a third of business bankruptcies in the U.S. To cover the losses caused by employee theft, a company may have to lower payroll by releasing employees, delaying key personnel promotions, and putting company expansion plans on hold.

b) Psychological Effects
Employee theft causes the employer to step up security measures that affect the entire workplace. Tension in a company arises between management and staff when stricter rules are put into motion to prevent theft. This includes surveillance cameras, identity badges, and restriction of employee access to materials.
The persistence of internal theft when effective measures aren’t in place leads to other workplace crime instances. Businesses need to put forth risk management plans and pair them with adequate FL employee theft coverage to minimize as much loss as possible.