Ask the Advisor – Occupational Fraud

Bruce Knapp, CPA, ABV/CFF, CVA, CFE, Valuation and Litigation Support Shareholder

Q: I suspect an employee may be embezzling money from my business. What should I do to confirm my suspicions?

Occupational fraud poses a threat to hundreds of organizations each year, but the recent economic crisis spurred by COVID-19 has provided prime conditions for employees to commit fraud. Historically speaking, there are a number of reasons fraud proliferates during recessions and times of uncertainty. A large factor is the increased financial pressures and opportunity.

If you believe an employee is embezzling from you, take a look at the facts. Start documenting unusual behavior and discrepancies you find. Avoid confronting the employee without hard evidence and guidance from your legal counsel.

In some instances, it might be best to hire a forensic accountant. They can help trace the trail of fraudulent activity back to its source and uncover the true magnitude of the crime. A good forensic accountant can also help you set up your financial and accounting processes to avoid future fraud exposure. Contact Doeren Mayhew today if you need assistance navigating employee embezzlement.