September/October 2015

Page 51

DID YOU KNOW?

Asset Misappropriation: The most common form of fraud The following are types of asset misappropriation: - Bogus refunds or voids - Falsified wages - Fake expense reimbursements - Payroll tax skimming - Personal purchases billed to the company - Theft of cash on hand - Unrecorded or understated receivables - Unrecorded or understated sales - Write-off schemes

“I know you have trusted employees, but you have to be aware. Keep on top of your own business.” Susan Kadlec, partner and attorney with Jovanovich, Kadlec & Athmann, PA.

Case in point: stealing payroll taxes is hard to detect quickly, depending on how skilled the employee is at covering it up. “The employee may intercept the notices from the IRS that taxes were not paid,” Kadlec explained. “Or, they’ll come up with some explanation of why the government screwed up and commit to following up with the IRS. It can take months to sort out.” Businesses that deal with large sums of cash are also

vulnerable, Kadlec said. “It’s a lot easier for money to go missing here and there without being noticed.” The hand in the cookie jar The sad reality is occupational fraud is committed by individuals you see and work with every day. “It’s committed by someone in a position to handle funds,” Kadlec said. “When you have access to the funds, you are not stealing from a stranger, but from the organization you are a part of.”

Kadlec also cautions that theft can happen at every level of a company with people at every income level. “Somebody may be short $100 bucks on their rent,” she said. “Or somebody may just see an opportunity and get greedy. I know you have trusted employees, but you have to be aware. Keep on top of your own business.” Heidi L. Everett is owner of Watab Communications in St. Cloud.

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