3.

Employee theft
According to a recent study by Jack L. Hayes International, one out of every 40 employees in
2012 was caught stealing from their employer. Even more startling is that these employees steal
on average 5.5 times more than shoplifters ($715 vs $129). Employee fraud is also on the uptick,
whether its check tampering, not recording sales in order to skim, or manipulating expense
reimbursements. Ethical alert: The FBI recently reported that employee theft is the fasting
growing crime in the U.S. today.
The financial statements (internal and external), books, and records of a
business may also be targets for fraud. Specifically, they may be:
Manipulated to hide fraud (e.g., to prevent discovery of an asset
misappropriation), and/or
Falsified to accomplish a fraud (e.g., to cause unjustified financial
rewards, such as executive bonuses based on falsified financial
performance data).
Payroll theft. This takes many forms. Employees may submit false reports of hours worked or
false expense reimbursement requests. Or an employee with access to the payroll system might
pay a bonus, accrue extra vacation time, or create a ghost employee.
Reasons for Employee Theft
What leads employees to do this? Generally, employee theft occurs as a result of motivation,
rationalization, and opportunity. An employee may be going through personal financial issues, or
simply perceive that they are underpaid and undervalued by the firm. The employee then
rationalizes that the theft is justified as a replacement for the pay raise or profit share they
were denied.
Motivation and rationalization are difficult to predict and are not within the firms control. The firm
can control opportunity, however. Firms with careful controls that are rigorously followed not only
send a message of deterrence to employees, but are better prepared to detect fraud sooner,
catch perpetrators faster and reduce the costs of these incidents.
Expense Reimbursement Schemes
As with check tampering, there are four common and distinct forms of fraud through expense
reimbursement:
Mischaracterized expenses: The fraudster requests reimbursement for a personal expense by
claiming it is related to the business.
Overstated expenses: The fraudster requests reimbursement higher than what they paid by
altering receipts or over-purchasing equipment.
Fictitious expenses: The fraudster claims expenses through a fabricated or blank vendor receipt.
Multiple reimbursements: The fraudster submits the same expense more than once.
These perpetrators aim to achieve their offenses by counting on rubberstamp managers. So the
bestand perhaps onlyrecourse companies have to identify expense reimbursement fraud is
through a thorough review and analysis of expense accounts and reports. Companies should also
enact clearly defined expense reimbursement policies and procedures to deter potential
fraudsters from relying on others follies.
This type of fraud is typically committed by an employee who generates false claims for
expenses to be reimbursed. It is as common as payroll fraud schemes. The losses with this
type of scheme are relatively low compared to payroll fraud schemes. The methods for
concealing this type of fraud are varied. Some examples include claiming personal travel as a
business trip or listing dinner with a friend as business development.
Other methods include overstating the actual cost of business expenses, altering receipts to

show a higher amount, or substituting receipts (for example, purchasing an expensive and an
inexpensive airline ticket, submitting the receipt for the expensive ticket for reimbursement,
then using the inexpensive ticket to travel and getting a refund from the airline for the
expensive ticket).
Creating false receipts is very easy with todays desktop publishing tools. You can also obtain
blank receipts from legitimate sources and fill them out and submit them. This type of fraud is
typically perpetrated by high-level employees, owners, and officers because they are normally
the only employees authorized to be reimbursed for expenses. Conversion for this type of
fraud is easy because a company check is issued to the employee for an allegedly valid claim
and he or she simply cashes or deposits the check.
it's a trap, she'll "look the other way" and use that against you if the opportunity arises.
You should never lose money or gain money due to your expenses". I'm sure some people do it,
but I'd never risk it, it's just not worth it.
In this case, it's just an easy setup for the boss to say that they never told you anything of the
sort, and because it was all verbally agreed upon you'd quickly be out of a job.