One of our customers who has experienced employee fraud told us the final cost to the business was in excess of $120,000 over fourteen months.  The only reason this fraud was undetected for so long was because the business owner had lax business practices in place which facilitated the fraud.  That’s what the owner told me after looking at what happened.  He made it too easy.  If this business followed these simple steps the fraud could have been avoided:

  • Establish rules for discounts, no sales, refunds and cash handling.  Enforce them.
  • Track every sale by employee.
  • Force the entry of amount tendered to complete every sale.
  • No refunds to customers without getting customer name, address and driver’s licence number.
  • Balance at the end of the shift to within $5.00 – chase the problem down if you are up or down by more.
  • Change passwords every two weeks, tell no one the master password.
  • Change who works with whom.
  • Do police checks on prospective employees.

Theft in retail can be managed.  All it takes is tough rules and adherence at all levels in the business to these rules.

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