October 20, 2017 • By Dennis Beaver
Are there steps that employers can take which will help reduce the chances of becoming the victim of embezzlement by employees? The answer, which comes to us from the far off Canadian city of Halifax, is a qualified yes, and as you will see, requires, initially, that employers adopt a different attitude about trust.
David Harris knows a lot about employers, trust and employees who steal. As Chief Executive Officer of Prosperident, the world’s largest firm specializing in the investigation of financial crimes committed against dentists, he understands the way human nature gives criminals an advantage: “It is the failure to revisit the trust placed in your employees.”
The decision to trust is reached in seconds – and is rarely examined later
Harris observes that when we first meet someone, “The decision to trust is made early in the relationship. Research shows it is the product of our brain reaching that conclusion based on rapid comparisons to other people we have met and trusted.
“And most of the time, day in and day out, as things in the office go along smoothly, the decision to trust remains permanent. We never again ask, ‘Can I trust Peggy?’
Harris is a captivating seminar leader, so for a moment, picture yourself listening attentively, when grabs your full attention by saying:
“I do not care how impressed you were with Peggy when she was first hired. Ask yourself, ‘While initially I trusted her, does that trust merit being re-examined as opposed to being something permanent which will not change, no matter what?”
You are thinking, “That never occurred to me. Why should I suddenly doubt Peggy? She’s been with me all these years.”Then he explains why you must question the basis for your continued trust in Peggy and why blind trust is so dangerous:
“The fact that you trusted an employee ten years ago does not mean that you should blindly trust them today. You absolutely must ask:
1. Has Peggy’s living situation changed?
2. Is she in financial trouble?
3. Has she developed an addiction to drugs, gambling, or does she have family members hitting on her for money?
If she does, how could that impact my business?”
Emotionally viewing employees as furniture
Harris finds that, “Employers, in general, do not know their staff well enough. Emotionally they see them as furniture, not noticing much about their personal lives. They are often in the dark as to an employee’s financial circumstances or other issues which could threaten the business if this person decided to steal.”
So, how can an employer get to better know employees without prying into personal things?
“I tell dentists that getting to know your staff better is a realization that this is a whole person and not just two arms that hand me instruments. Understanding what makes your employees tick is essential to being a good employer. You should know why they got into this field, and what they like and do not like about their job. That’s a vital part of being their boss.
“This isn’t intrusive,” Harris maintains, adding, “You need to engage in meaningful conversation. I find that many employers are not good active listeners.”
Hire carefully – stop it at the door
Harris believes strongly that the best way for any employer to minimize theft is to “Stop it at the door through your hiring process.”
He notes that “65 million Americans have a criminal record. That’s one in four adults. Add to that the fact that between 40 and 70% of resumes have some amount of misleading information, it is clear that hiring is a potential minefield.”
We all know that applying for a job at FedEx requires a drug test, but as Harris observes, “Most dental offices do not require a drug test, nor do they run adequate background checks. It simply does not occur to many employers that someone will lie on an application to hide an unsavory past.
“The last step in the hiring process must include criminal records check, performed not by some twenty dollar, online website, but by a professional service,” he strongly recommends.
No one is bulletproof
Can any employer become “bulletproof?” David Harris provides the answer:
“There are employers who believe that something in their circumstances makes them bulletproof. A classic example is thinking, ‘This is a big city problem, but I am safe because I live in a small town.’
“However, embezzlers do not think the same way.”
Dennis Beaver practices law in Bakersfield and enjoys hearing from his readers. Contact Dennis Beaver.