In a business you employ people based off trust, belief that they will work hard and do what is needed to be done in your business. Often, you know what they are doing and what their role is, but what happens when they start to break the trust you placed in them?
That was the reality for two businesses after finance manager Ciara Highfield admitted stealing more than £50,000. Working at Maze Rattan Ltd, the employee abused her position, overpaying herself by £34,000 and spending more than £7,000 on an unauthorised fuel card. She also admitted to stealing £10,000 from Lakeside Furniture Direct.
Cases like this can raise questions: how does a business know when something isn’t quite right?
Unexplained transactions, suspicious employee behaviour and over protection of pay roll can all be signs of fraud from within your business. If suspicions arise, private investigation can help you identify what is really going on in your business. In Highfield’s case, the offending included an unauthorised fuel card spending and overpayments to herself, exactly the type of financial activity ineffective oversight may overlook.
This can happen more than you would think, David Kissack was a business director at a recruitment agency and between August 2016 and December 2022, stole almost £80,000. He had been invoicing the company directly and directing payments into his personal account. How did he get found out? A customer emailed the company about a worker the agency did not recognise which prompted an internal investigation, uncovering the actions of Kissack. After being reported to the police and pleading guilty to 5 counts of fraud by false representation, Kissack was ordered to pay £19,000 in compensation and a two-year suspended sentence.
We often see clients battle with the loss of trust when employees steal from a business and we work to support that client to get back on track and ensure the matter is dealt with professionally and lawfully for all involved.
Being proactive is of course also the best route in business, so looking at who you offer a position too before hiring them is key. Due Diligence checks can help you be sure of who you’re hiring and be sure of who you’re trusting with your business’s reputation.
We can explore employment gaps, qualifications, business interests and other lawful enquiries to help you determine whether the prospective employee has told you the truth and are who they really say they are.
Businesses can have systems and processes designed to prevent fraud, yet deeper than that they still rely on humans, and too much responsibility with one person can create vulnerabilities that technology can’t detect. The human element is an important aspect which can be managed by a separation of responsibilities, and appropriate oversight to identify unusual activity.
Life is changing all the time, so when circumstances change, the changes need to be understood and with application of the appropriate controls the risk of fraud can be managed, which in turn helps to prevent the human element of fraud. Despite systems being able to flag something that doesn’t look right, it still takes someone to notice, question it and decide the next steps. The Kissack case highlights that it doesn’t have to take a high-level fraud prevention system to raise the alarm, but an enquiry that didn’t make sense and someone recognising that it warrants a closer look.
Whether concerns begin before employment, with something in the workplace or when the money has already disappeared, it’s important to recognise when something doesn’t add up.
The Highfield and Kissack cases involved very different circumstances, but both demonstrate how considerable sums can be taken from businesses by people within them.
Fraud doesn’t necessarily announce itself with £50,000 suddenly disappearing from an account. It can begin with something much easier to overlook.
If you suspect fraud or theft within your business or wish to discuss due diligence checks pre-employment, don’t hesitate to get in touch for a confidential discussion.