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Am I a Victim of Employee Fraud?

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Did you know that employee fraud and embezzlement costs Canadian companies hundreds of millions of dollars every year? Some businesses are even forced to close because of it. If you don’t want your business to become jeopardized because of a deceptive employee, there are a number of red flags to look out for. Follow these tips below to avoid becoming a victim of employee fraud.

Works Outside of Business Hours

Do you have an employee who consistently comes in extra early or stays after hours? You should always look into employees who make a consistent effort to be in the office or business alone, especially if they have a role that gives them access to the company’s funds. 

Refuses Access to Records

Are there a number of accounting files that have been suddenly encrypted that weren’t before? Has an employee started refusing access to the accounting records? If you can’t get proper access to certain files, you should investigate. 

Private Meetings

Do you have an employee that sets up private meetings with one particular vendor? Special relationships with vendors could indicate that there’s more to the relationship than you think. 

Purchases are Inconsistent with Salary

Is one of your employees suddenly driving a brand-new high-end vehicle with only an entry-level accounting job?  Have they recently purchased a new home that’s well beyond their salary? If so, it might be worth questioning where they’re getting the money to fund such a lavish lifestyle if they don’t have a wealthy spouse or family member. That money might be coming from illegal sources or even from underneath your nose. 

Changes to Vendor Invoices

If you’re finding invoices that are much lower than what is paid out or ones that are much higher than the quoted amount, you should investigate. You can find a number of money laundering and embezzlement scams by examining your accounts payable and receivables for amounts that look unusual. 

Missing Information

When there is missing vendor contact information or omitted details regarding the goods or services, it’s wise to ensure these vendors and invoices are not fake. Start by looking through your cheque books to confirm there are no missing cheques. If you do find any, it’s important to determine who the cheque was made out to and match it to a particular invoice. 

Increase in Write-Offs

An unusual number of write-offs can point to embezzlement. Where this is the case, an employee will pocket the money and write it off as being unpaid or as a debt. 

Don’t let your business become victim to employee fraud. If you suspect an employee is embezzling funds or engaging in criminal activity, contact us at The Smith Investigation Agency and we’ll investigate further. 

About the Author

Whitney Joy Smith

Founder of The Smith Investigation Agency in 2014, Whitney Joy Smith’s extensive background as a private investigator is matched only by her passion for the role. A graduate of several respected institutions, including Northwest Florida State College and George Brown College, her early years in life were spent between Canada and the United States. This education, along with her formative years as a private investigator in various agencies, informed much of her knowledge of private investigative laws, regulations, and operating standards in both countries.

The recipient of numerous industry awards and accolades, including the Consumers Choice Award, Best in Ottawa, and many others, Whitney takes pride in working closely with her ever-growing agency to raise the bar, maintain compliance, and meet the investigative needs of clients. Whitney is active in various membership and supporting roles, including the CPIRC, CBN, CAPI, Canadian Women’s Chamber of Commerce, and many others. Her experience-driven, thought-provoking articles have been featured in everything from Readers Digest to Business News Daily, and she strives to continually redefine standards for those in the private investigative and security fields. Learn more about Whitney and the team at The Smith Investigation Agency today.

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