Call Us - We're Easy to Talk To (214) 999-9999

4 Legal Tips for Handling Employee Fraud as a Business Owner

Employee fraud is an alarming issue affecting many small businesses. Fraud by employees costs these organizations about $50,000 for every occurrence. Worse still, fraud by managers can cost more. These figures may seem astronomical because these fraudulent activities can go for years before their discovery. Over those years of fraud, unfortunately, the losses can become too significant for a business to withstand. For many organizations, employee fraud is the leading cause of failure.

Garner Evidence

One of the best ways to handle employee fraud is by implementing a system you can use to monitor workers. While you may not be confident of preventing them from stealing, you can easily apprehend. That way, you will be minimizing cases of employee theft. To achieve this, you also need to invest in quality tracking systems. Begin with purchasing surveillance cameras. Incorporate a viable security system therein. The two together will help you monitor employees while keeping away fraud. But, in case it happens, you should begin with garnering evidence to support the claim. If the business owner heard of the act from another professional within the organization, the matter should be investigated prior to making accusations.

Confront The Employee

The business owner needs to confront the employee in person before taking action. The discussion should be held in an office. The team of professionals needs to jump straight to the matter. Here, an explanation should be sought. If the offender refuses to admit to having committed fraud, then the business owner should hire a legal defense attorney to show evidence supporting the accusation. Fraud investigation should be approached as a confidential task. All allegations should be handled by a trusted senior official working in the legal department. In some organizations, this is the responsibility of a corporate adviser.

Involve A Team of Legal Experts

Employee fraud is common. It can be devastating to a business. Of course, it can happen in various ways, such as a cashier failing to enter money into the register. In such an instance, the business owner needs to hire a legal team of criminal defense attorneys to conduct an extensive investigation and find out who committed fraud. The history of the suspect should be referred to as determining whether they are guilty or not. At this juncture, the legal team should also find out whether the suspect was assisted by anyone else with the fraudulent acts.

Press Charges

Determine if it’s right to press charges. In this case, if the fraudulent activity has led to the loss, it’s best to press charges. If the company has lost thousands of dollars, then criminal charges should be pursued. The employer should take steps to inform employees of the act. Besides, since evidence has been collected, the business professional should share information with employees to stop prevent the spread of rumors.

One of the best ways to protect a business from fraud is by building a team of professionals that values honesty. These employees should adhere to a code of conduct too. For that reason, business owners need to hire employees with integrity.

Author Bio: Emma Sturgis is a freelance writer based out of Boston, MA. She writes most often on health and education. When not writing, she enjoys reading and watching film noir. Say hi on Twitter @EmmaSturgis2

Bob Kraft

I am a Dallas, Texas lawyer who has had the privilege of helping thousands of clients since 1971 in the areas of Personal Injury law and Social Security Disability.

About This Blog

The title of this blog reflects my attitude toward those government agencies and insurance companies that routinely mistreat injured or disabled people. As a Dallas, Texas lawyer, I've spent more than 45 years trying to help those poor folk, and I have been frustrated daily by the actions of the people on the other side of their claims. (Sorry if I offended you...)

If you find this type of information interesting or helpful, please visit my law firm's main website at You will find many more articles and links. Thank you for your time.

Find us on your preferred network