Risk Management (05/09) P. 40 ; Bellinger, G. Michael
When dealing with a potential embezzlement case, it is not always wise for companies to immediately call the police and fire the employee who is believed to have participated in the theft, since doing so can often result in internal scrutiny and negative publicity, which in turn can hurt employee morale and the company's reputation. Instead of immediately calling law enforcement and firing the employee suspected of the embezzlement, companies that believe that one or more of their employees may have stolen money from them should immediately launch an investigation into the suspected theft. The investigation should be conducted by outside counsel rather than the company's general counsel or others. During the investigation process, outside counsel should interview the suspect and try to get them to admit to the theft--something that can be easily done when proper, legal interrogation methods are used. After investigators obtain an admission of guilt from the suspect, they should then try to determine how much money was stolen, how much remains of what was embezzled, and the total value of the assets the employee owns free and clear. Work should then begin on restoring what the company lost. This can involve negotiating with the employee for the return of the stolen assets, as well as negotiations with the suspect's family members, who may be willing to help make the company whole again. These family members may be willing to help if the company promises not to go public with the theft. Companies may still need to notify police about the theft, particularly in the event their investigation does not result in the closure of the case. Notifying law enforcement is necessary if companies want to make a claim with their insurance company.(go to web site)
