How You Can Help Prevent Employee Theft in Your Organization

Employee Background Check and Hiring practices to prevent theft

Protecting your assets can help ensure your organization maintains profitability. This can enable your organization to deliver reliable and timely service while safeguarding income and customers.

According to the Federal Bureau of Investigation, it’s estimated that almost 900,000 burglaries took place in 2021. Victims of these burglaries suffered billions of dollars in property losses.

Depending on the risk, internal protections can vary between organizations. Value, obtainability and reasonable hazards can all impact the protections that organizations should implement.

Background Screening

In today’s world, background checks should be considered the minimum level of employee screening. Employee screening should include federal, state and local background checks, verification of at least two applicant references, MVR checks and a social media screening. Employers should verify the information provided and confirm that it is truthful. Many background checks allow employers to verify degrees from accredited universities.

Organizations should implement a list of acceptable violations, including minor violations, and conflicting information should be reasonably explained and verified.

Employee Security Access Control

Employees are the backbone of a successful organization. Jobs can range from working with customers to stocking shelves or taking inventory. Organizations must be consciously aware of the risks associated with employees and their knowledge of operations. Many employees handle valuable equipment, know where it is stored and may even have access outside of normal business hours.

Valuable equipment should only be accessible during office hours. Areas where expensive or valuable items are stored, can be secured using badged or remote-controlled access through a security system.

It’s important to ensure that employees are limited in the time spent alone around equipment without a direct supervisor or an additional employee present. Over 50% of cases occur in employees with a tenure of five years or less. However, those who are tenured longer are often the causes of larger thefts. The average loss from an employee is $50,000, while the average loss from owners and executives is $337,000. In retail, the average loss was $65,000 in 91 cases studied in 2022 (Association of Certified Fraud Examiners).

Termination Protocols

A unique concern with terminated employees is their level of knowledge within your organization.

Past employees may know where cameras are located, where valuable equipment is stored, and ways to bypass security measures. Once an employee is terminated, access should be revoked immediately, and records should be kept to identify employees who may have a high risk of retaliation toward your organization. Larger organizations may consider relocating high-value equipment to an alternative site within their location.

We’re Here to Help – Contact Our Loss Control Consultants Today

At Great American Insurance Group, we strive to ensure that our policyholders are not only aware of the hazards they face but are equipped with the necessary tools to prevent and combat them as effectively as possible. Interested in learning more? Talk to our team of experts.

For additional information on improving your organization’s safety and security, visit the Plan & Protect Hub.