Fall - InsideOutdoor Magazine

Back Office
TO CATCH A THIEF
Solving the worst kind of shrink
by James W. Bassett
According to a U.S. Chamber of Commerce
research study conducted in 1975, one-third of all
small business failures are caused by employee theft.
Despite improvements in alarms, surveillance cameras
and other security hardware, employee theft still takes
the same toll on small business today. But you’re
primary interest is in your store and the employee
theft problem you may have now or may confront in
the future.
Some people wonder why employees steal.
Is it always “need” or “greed” as many textbooks
claim? In reality, it’s not that simple. Employees
steal because they see themselves as victims
enabling them to blame their stealing on someone or
something else. Employees who steal believe “I am
owed, but I haven’t received. So I will make things
even by taking what is owed to me.” The thief can
blame society, prejudice, low pay, under appreciation,
overwork, poverty, bad luck, parental neglect, parental
overindulgence, etc., etc.
Once employee theft occurs in a location, it can
quickly spread like a disease among employees. The
antidote is to confront thievery quickly and decisively.
If other employees observe a co-worker fired or
prosecuted for stealing, they are far less likely to
steal. Conversely, ignoring employee theft sends the
message that management is either indifferent to
employee theft or powerless to stop it.
The busy holiday season and the chaos it often
brings to retailers is a perfect storm for employee
theft. It is nearly impossible for outdoor retailers to
continually conduct inventories during this hectic
period. Most employee theft committed during
November and December is not discovered until
January. Additionally, many small stores hire temporary
workers who know their jobs will be gone by New
Year’s Day. The shorter the employee’s tenure, the
more likely she will steal from her employer.
This year may be a banner year for employee
theft. Recent events in our country have spawned
millions of American workers who see themselves
as victims. Some truly are victims who face financial
disaster. Devastating hurricanes, rapidly increasing
prices, home mortgage foreclosures, stock markets
losses, rampant inflation, a general recession and
expensive gasoline are just some of the factors
threatening to make this holiday season an employee
theft record breaker.
Once an employee starts stealing, he continues
stealing in progressively larger amounts until he is
caught or strongly fears he is going to be caught.
Stealing employees often quit when a theft investigation
is announced. Others quit during the
investigation. The thief believes that once he has left
your company, he can’t be prosecuted.
When you experience an employee theft, you want
to report it to the police right away. A uniformed officer
usually will come to your store and take a report. He
will hand your case over to a detective who will then
come out and interview you. But this may be the last
you hear from the detective. Most police agencies
don’t like employee theft cases because they are
difficult to investigate. Most employee theft cases
yield no eye witnesses and no physical evidence. Even
when stealing employees are caught, most employers
choose not to prosecute. This leaves the detective
feeling like he’s wasted his time. Metropolitan police
departments consider employee theft cases a low
priority. Their first priority is crimes against persons
rather than property. This means your employee theft
case will probably be pushed to the back burner.
How do you solve your employee theft case? The
best way to find out which employee(s) are stealing
from you is to ask the people who can probably tell you
– your honest employees. We have found that better
than 80 percent of the time, employees who were not
involved in the theft strongly suspect which co-worker(s)
committed the theft. Sometimes they know for sure
which co-worker is the culprit.
There are two ways of asking your employees what
they know about a theft. First, you can individually interview
each of your employees and ask them what they know
about the theft, who they think stole what is missing,
and why they think so. However, most store owners feel
uncomfortable assuming the role of interrogator. They fear
damaging rapport with their employees and fear company
morale might be affected. Others simply don’t have the
time or the inclination to investigate a theft in their stores.
However, there is an alternative.
The alternative is a theft investigation questionnaire
administered to all employees who had access to
what was stolen. The theft investigation questionnaire
is a pen and paper investigative tool – a written theft
interview you administer to your employees in a group
like a written test in school. The theft investigation
questionnaire can be ordered from the author’s Web
46 | InsideOutdoor | Fall 2008