Theft in the Workplace: How to Identify and Stop It


No matter what type of business you run, you’re vulnerable to employee theft motivated by greed, anger, dissatisfaction, or an “above the rules” attitude.

Which of these ways employees steal are areas of vulnerability for your business?

Payroll theft: Are your employees really working the hours they claim to be? Do you have controls to stop buddies from punching in and out for each other?

Embezzlement: Do you audit expense reports, invoices, and company credit card statements to look for personal use and forged expenses?

Office supplies: It is known that some employees steal everything from copier toner to toilet paper. 

Merchandise: In retail and restaurants, point-of-sale technology has made it easier to figure out who’s doing what and when.

Financial Assets: Use accounting software and online banking so you can keep watch over your business accounts. Always have two employees verifying financial tasks and transactions.

Intellectual property: You’re especially at risk when employees have access to customers confidential information. Have you considered how to protect your intangible business assets, like source codes, from theft by current and former employees?

You may believe your commercial insurance property policy protects your business from all types of employee theft, but that isn’t always the case.

Close-up of a person using a magnifying glass to review financial documents, symbolizing efforts to detect employee theft or discrepancies in business accounts.

In general, commercial property policies written on an all-risks basis typically cover most forms of employee theft, including the theft of inventory and contents.

Commercial property policies exclude cash and securities since they aren’t classified as property in this context. To protect against the theft of money and securities, both on and off your premises, you’ll need a crime policy.

This type of policy can also cover employee benefit plans. The Employee Retirement Income Security Act (ERISA) requires employers to carry insurance equal to 10 percent of the funds administered. The minimum amount of coverage ERISA requires is $1,000 and the maximum is $500,000. 

You can also write an employee theft policy to include 401(K) plans, profit-sharing plans, pension plans, and medical, dental, vision, life, and disability insurance plans. ERISA also requires bonding for those who administer employee welfare or benefit plans. You can satisfy this requirement by using an employee theft policy. To activate coverage, you must add each plan to the policy’s named insured.

We welcome the opportunity to put our accounting expertise to work for you. To learn more about how our firm can help advance your success, don’t hesitate to contact Kathy Corcoran at (302) 254-8240.

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