Old School Embezzlement
One of the first reported cases of embezzlement occurred in 1873. After suffering over $42,000 in stock market losses, Nathaniel Appleton Shute embezzled $150,000 from two New Hampshire banks. Shute was apparently a well-respected citizen who served as cashier and treasurer at the two banks. After committing the crime, Shute fled to Cuba and never returned to the United States. The crime shocked his family, who were forced to make payment on bonds they had signed to help Shute obtain his position at the banks.
Casper, Wyoming - Wednesday, January 18, 2006
According to this article in the San Antonio Express-News, A busy Washington, D.C., dentist had complete confidence in his bookkeeper until it was too late. Like many small business owners, the dentist gave his new bookkeeper control of his books. He trusted her so much that he never watched his money or looked over his financial statements. The woman, aware of her boss' casual attitude, had stolen at least $130,000 from the business within two years. She had also given herself a $20-an-hour raise and falsely claimed to work 50-hour weeks. Ashamed that he had been victimized so easily, the dentist did not report the crime to the police. Instead, he dismissed the woman and helped her get another bookkeeping position with a solid reference.
White-collar crime is increasingly throwing small businesses into debt, forcing owners to lay off employees, go bankrupt, or close shop.
The article pointed out some interesting statistics involved with embezzlement:
A) Employees helping themselves to company funds cost U.S. businesses about $660 billion annually, according to a recent report from the Association of Certified Fraud Examiners. The report also revealed that more than 46 percent of all workplace fraud happens to small businesses with fewer than 100 employees.
B) The U.S. Department of Justice estimates that employee theft is growing by as much as 15 percent each year. According to an Auditors Inc. survey of 1,000 certified public accountants, as many as 40 percent of small-business owners are embezzlement victims.
C) Other statistics show the broader scope of the problem: Up to 30 percent of the nation's workers will steal at some time in their career, with up to 75 percent of all employee theft going unnoticed, according to the U.S. Chamber of Commerce.
D) One-third of all business bankruptcies are due to employee theft, according to the U.S. Chamber of Commerce.
E) At least 20 percent of all business failures are the direct result of employee theft, according to the American Management Association.
F) The average business loses 6 percent of its annual revenue to fraud and abuses by employees, according to the management association.
More Embezzlement in the News
April 10, 2008
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