Risk Management - Employee Theft

loss prevention message from Federated Insurance

Wednesday, March 20, 2019

 

Federated Insurance’s Claim of the Month — Could it happen to you?

Trusting employees is key to running an efficient and successful business, but do you have proper procedures to prevent such thefts from taking place? Do members of your management staff perform checks and balances? Do you check your inventory against your financial records to detect irregularities? How often do you check your balance sheets?

It is well known that theft and fraud are against the law, but demonstrating that such acts will not be tolerated by your business is still a solid first step toward helping prevent them. Ensure that your employee manuals clearly define theft and state the consequences for employees at all levels.

Here are some additional tips to help protect against theft and fraud:

  • Provide strong internal controls that keep your finances up-to-date and can quickly help identify any fraudulent practices. Encourage employees and customers to report suspicious activity.
  • Pay attention to behavioral indicators of fraud, including, but not limited to living beyond one’s means, financial difficulties, and unusually close association with vendors and/or customers.
  • Make sure your hiring practices, including background checks where appropriate, address prior theft and fraud. Talk with qualified counsel before hiring someone who has a history of criminal activity.

Federated Mutual Insurance Company® is recommended by 19 state and national automotive associations for customized insurance programs and value-added risk management services, such as Federated’s Shield Network®, the Risk Management Resource Center, and the Federated Employment Practices Network®. Visit federatedinsurance.com or contact your local marketing representative for resources you can use to create or enhance your own risk management program.

 

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