Why Employees Steal–and What You Can Do About It

The reasons why employees steal can be hard to predict.  Wouldn’t it be nice if employees prone to fraud had the letter “F” stamped on their forehead?   You could monitor them closely and make sure they never had access to the accounting books. But potential thieves are never that obvious.

It starts with pressure

In many cases, employees who commit fraud are the most likable people in the office — personable, helpful and good at their jobs . . . and seemingly trustworthy. But fraud doesn’t begin with dishonesty; it begins with pressure. The pressure may be work-related (corporate demands to meet revenue goals) or personal (gambling debts or substance abuse).

Unfortunately, many of the skills needed to successfully commit fraud are also necessary to thrive in the business world. Salesmanship, sociability, determination, persistence, competitiveness and a desire to obtain material possessions all are frequently cited as characteristics of successful professionals — and successful criminals.

The usual suspects

Occupational fraud perpetrators generally share certain traits. For example:

Entitled executives. Upper-level fraud perpetrators tend to be extremely ambitious and to have an overdeveloped sense of superiority. These individuals are likely to be unreasonably sensitive to criticism or scrutiny and to surround themselves with sycophants. They might doctor financial statements to make the company’s — and their own — performance look better or embezzle funds.

Resentful workers. Rank-and-file employees who commit fraud are more likely to feel they’ve been undervalued, underpaid or treated unfairly and justify their theft accordingly. Some steal to seek retribution.

Con artists. Fortunately, this type of thief — capable of lying to people’s faces and leaving them penniless without remorse — isn’t common in the workplace. But con artists can be destructive, and they usually blame their victims.

Some people with these attributes steal only if under pressure, while others withstand similar pressures without turning to fraud. In companies with strong internal controls, fraud is too risky for most employees to attempt, even if they are feeling financial pressure. But in more-lax environments, just about anyone might try their luck. For this reason, comprehensive internal controls are always recommended.

Putting ethics first

It’s not easy for companies to spot dishonest employees. So in addition to shoring up your internal controls, you should also foster an ethical business culture. Promote and reward honesty and punish those who violate rules. Contact us for more information.

How can we help?

  • Should be Empty:
  • Topic Name:

DISCLAIMER: This blog is provided for informational purposes only and is not a substitute for obtaining accounting, tax, or financial advice from a professional accountant. Presentation of the information in this article does not create nor constitute an accountant-client relationship. While we use reasonable efforts to furnish accurate and up-to-date information, the evolving landscape surrounding these topics is supported by regulations or guidance that are subject to change.

We Value Your Privacy

This site may use cookies to store information on your computer. Some are essential to make our site work and others to improve the user experience. By using this site, you consent to the placement of these cookies and accept our privacy policy.