“That wouldn’t happen here! My accounting team would catch it. My employees are like family!”

No one likes to think their employees would steal from them, but nearly two out of three businesses have been victims of employee fraud, reports the U.S. Chamber of Commerce.

Fraud conducted by employees costs an employer, on average, $60,000 for every incident. But when managers and supervisors are involved, fraud costs can jump to $180,000 per event, according to a report from the Association of Certified Fraud Examiners.

Fraud can take many forms. These are some of the most common:

• Misuse of company assets, such as selling company scrap, renting out company equipment, or carrying out a competitive business using company materials
• Skimming cash
• Payroll fraud, including ghost employee schemes and timesheet fraud
• Data theft, including intellectual property and customers’ personal data
• Unauthorized credit card purchases
• Accounting fraud, including payments to fake vendors or bank transfers to the employee’s own account

If you suspect fraud has occurred, you need to investigate carefully to preserve the integrity of any evidence. Maintain strict confidentiality to avoid defamation risks or alerting accomplices.

Decide if the employee should be suspended right away or if theft would be better detected by monitoring employee actions. If you choose suspension, remember to revoke all access privileges, including office keys, credit cards, and passwords.

If fraud is substantiated, to...

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