Hard times make thefts by work­ers a big­ger prob­lem

The Kansas City Star (Sunday) - - FRONT PAGE - By JOE LAMBE

Re­tail­ers spend a lot of time and money to pre­vent shoplift­ing, but a big­ger threat to the bot­tom line is the per­son be­hind the counter.

No one knows ex­actly how much em­ploy­ees steal each year, but one na­tional sur­vey late last year showed that com­pa­nies lost $18.7 bil­lion in the 12 months end­ing in June be­cause of worker theft — the largest sin­gle cause of re­tail “shrink­age.”

An­other sur­vey for 2008 found that em­ploy­ees stole far more than shoplifters and that among 22 large re­tail­ers, one in 30 em­ploy­ees was caught steal­ing.

“It hap­pens from the top down to the bot­tom up,” said Terrence Shul­man, an au­thor and a coun­selor on the sub­ject who is a lawyer with a mas­ter’s de­gree in so­cial work.

Two re­cent lo­cal cases il­lus­trate how large the

prob­lem can be. A for­mer em­ployee is sus­pected of steal­ing more than $300,000 in goods from a Tar­get store in Kansas City. In John­son County, a sales­man and ship­ping clerk to­gether stole an es­ti­mated $30,000 worth of suits from an Over­land Park men’s store.

Ex­perts say that with hard times, more em­ploy­ees are steal­ing, but many have al­ways done it any­way. The U.S. Cham­ber of Com­merce has long said that 75 per­cent of em­ploy­ees steal from their em­ploy­ers at least once.

They start small, get bolder and of­ten get caught, said Casey Chroust, a vice pres­i­dent with the Re­tail In­dus­try Leaders As­so­ci­a­tion.

Said Shul­man: “More are get­ting caught be­cause se­cu­rity is get­ting more so­phis­ti­cated, but there are fewer loss-preven­tion of­fi­cers, so it’s kind of a wash.”

Al­lan Bach­man, the ed­u­ca­tion man­ager for the As­so­ci­a­tion of Cer­ti­fied Fraud Ex­am­in­ers, last week called the sit­u­a­tion “al­most a per­fect storm” as com­pa­nies that are try­ing to weather the re­ces­sion elim­i­nate pro­tec­tive mea­sures.

Two years ago, the as­so­ci­a­tion es­ti­mated that Amer­i­can busi­nesses lost 7 per­cent of an­nual rev­enue to fraud, but the group now sus­pects that fig­ure has grown. A short ran­dom sur­vey last spring found fraud in­creas­ing as those who mon­i­tor it get lay­off no­tices.

If a com­pany is floun­der­ing, some man­agers may try to loot the ship be­fore it sinks, ex­perts say. The same goes for em­ploy­ees fac­ing lay­offs and de­mands for harder work.

At the boss lev­els, big money van­ishes with fraud such as em­bez­zle­ment and kick­back deals with sup­pli­ers.

“There is a pos­si­bil­ity that schemes are be­ing cre­ated right now that won’t be dis­cov­ered for years,” Bach­man said.

Bach­man said thieves who steal by fraud are of­ten peo­ple in po­si­tions of ab­so­lute trust.

Said Shul­man: “It is of­ten the star em­ployee who is led out in hand­cuffs.”

The Tar­get em­ployee sus­pected in the mas­sive thefts from the dis­count chain’s Ward Park­way store had worked there since the store opened and was con­sid­ered its best em­ployee, po­lice said.

Tar­get se­cu­rity of­fi­cers in Jan­uary re­al­ized items were miss­ing from a load­ing dock and started an in­ves­ti­ga­tion.

Po­lice were called in to in­ves­ti­gate and of­fi­cers con­duct­ing sur­veil­lance watched as the fe­male em­ployee helped to put mer­chan­dise from the load­ing dock in two movers’ trucks. Of­fi­cers fol­lowed one truck to a Henry County farm­house, and they found about $100,000 worth of Tar­get goods there.

Of­fi­cers said the house was set up like a store, with minire­frig­er­a­tors and freez­ers on a back porch, house­hold items in one room, and toys and clothes in an­other. It was one of four such farm­houses they raided.

The in­ves­ti­ga­tion con­tin­ues, and the woman has not been charged.

Not even Jack­son County Cir­cuit Court is safe from a trusted worker turned thief.

Three years ago, au­thor­i­ties ac­cused a long­time pur­chas­ing clerk at the court­house of steal­ing or try­ing to steal more than $230,000 worth of com­put­ers and elec­tron­ics over a two-year pe­riod.

The clerk, Laura L. Soe­mer, or­dered boxes of goods de­liv­ered to her at­ten­tion and then loaded them in her car as sher­iff’s deputies and other court­house work­ers watched or even helped.

Soe­mer was known as a goget­ter who pro­jected au­thor­ity, her boss said. Two years ago, she pleaded guilty to two counts of theft and was sen­tenced to 10 years in prison. She is el­i­gi­ble for pa­role in April.

Last year, a John­son County jury con­victed sales­man Clifton Wil­liams of steal­ing goods from a Jos. A. Bank Cloth­iers store in Over­land Park in a scheme that lasted six months or longer.

Over­land Park De­tec­tive By­ron Pierce said Wil­liams, 34, worked with ship­ping clerk Joshua Poland, 24, to steal about $30,000 worth of suits and other goods.

Pierce said some­one who worked for the men’s store chain no­ticed the ship­ping clerk sell­ing suits cheap on the In­ter­net and traced where the clerk worked. An au­dit led to an in­ter­ro­ga­tion of Poland, who ad­mit­ted con­spir­ing with Wil­liams.

Poland sent suits to some offthe-books buy­ers, and he and Wil­liams smug­gled some suits out the store’s back door in garbage bags and later sold the suits on the In­ter­net, Pierce said.

Poland said peo­ple who bought the suits said they paid 50 cents on the dol­lar, and the sales­man told the buy­ers he was sim­ply pass­ing on his em­ployer dis­count. No buy­ers were charged with crimes.

Wil­liams was sen­tenced to pro­ba­tion, and Poland tes­ti­fied against him and was placed in a prison-di­ver­sion pro­gram.

Of­ten, em­ployee thieves are not even pros­e­cuted, said Shul­man and other ex­perts.

Re­tail­ers want to keep the mat­ter quiet, get their money back and just fire of­fend­ers, Shul­man said.

“Then they (the thieves) go on to the next em­ployer and do it again.”

Shul­man said peo­ple steal out of greed, griev­ances or psy­cho­log­i­cal prob­lems.

“Peo­ple have a lot of au­thor­ity is­sues,” Shul­man said. “You’d be sur­prised at how many think they’re en­ti­tled.” To reach Joe Lambe, call 816-234-7714 or send e-mail to [email protected]­star.com.

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