Secretary Stealing Money (credit check, insurance, suing, CPA)

[Lindsey_Mcfarren]

He gets fined, she has to pay back taxes AND go to jail for stealing money AND her husband thinks about loosing his license. I don't see the contest here. I would come on like ton a brinks BUT only after talking to an attorney.

[Capt. Cave Man]

I like Lindseys' advise.

Your talk'n big buck(to me anyway). It's going to "sting" him, but he can learn from this, we hope.

Sometimes ya gotta hire friends/relatives. Sometimes ya gotta punch them in the nose, too.

[Tressa]

I agree with Capt. and if her husband is the accountant he too should get punched in the nose. People who take advantage or steal from their FRIENDS are not Friends at all, one would be called a chump, guess which one that would be?

[pghquest]

Originally Posted by mgoldie1

Hi, I need some advice. My friend is owner of a small business (only 2 employees). He recently just found out that his secretary, who he has been friends with for almost 10 yrs, has been stealing from the company. He has verified this with copies of cancelled checks made out to Verizon, Bank of America (with different account numbers than his) and some duplicate "salary checks" made out to the secretary.

He is in the midst of gettting all his bank statements from 2007 to see how long it's been going on. Unfortunately, he gave total autonomy to the secretary to pay all bills and write out all checks, and even to sign his name on the checks.

In addition, her husband is my friend's accountant. The secretary has all the 2007 bank statements and gives the excuse that her husband needs them for tax purposes.

Also, there are two little caveats. She has always been paid cash (checks made out to cash) and my friend's wife has been put "on the books" as an employee (I believe due to health care).

Here's my question. What does he do??? He is definitely going to confront her, show the proof, give her an opportunity to admit that she did it, and try to find out how long it's been going on and how much she has taken.

What if she threatens to "tell" on him regarding paying her cash and keeping his wife on the payroll? What if her husband does something to his taxes/paperwork? Should he press criminal charges?

Please advise. Thank you very much.

*** I understand that my friend was not the smartest guy in the world to give all this autonomy to this woman and he has learned his lesson.

I hired my sister-in-law because she needed a job pretty bad. She lasted one day. First night on the job she went out and rang up company credit cards. I pursued it to the police etc. She didnt go to jail, pretty much the credit card companies (i.e. vendors) ate the funds.

Tell your friend to keep it quiet till the books get back, then call the law in on them. Theft is wrong PERIOD.

[UpperPeninsulaRon]

Originally Posted by KevK

1. Rule # 1: Never hire friends or family. If you have a friend or family member that needs a job, help them find one elsewhere.
2. Rule # 2: Always sign your own checks. Oprah Winfrey has a huge organization yet she still signs each check. Like she said "when you don't sign your own checks, you are not incontrol of your business anymore"

Rule # 3: Business owners should have all important documents like bank statements sent directly to their home. The owner should not only open them, but it doesn't hurt to circle a few numbers, put a question mark next to a few, etc. Make the person who ultimately uses the documents know that someone has been going over them (even if they really do not).

[RoaminRed]

Originally Posted by UpperPeninsulaRon

Rule # 3: Business owners should have all important documents like bank statements sent directly to their home. The owner should not only open them, but it doesn't hurt to circle a few numbers, put a question mark next to a few, etc. Make the person who ultimately uses the documents know that someone has been going over them (even if they really do not).

This is an excellent suggestion.

[KevK]

It might be hard to make a case like this stick against her. She is going to go to court and tell the judge and jury that he was a friend of hers and that it was her understanding that she could spend the money she spent- that he said it was OK for her to do so because he could write it off as a business expense. And since she was a friend, it will be a hard case to prove because the average Joe on the jury may not be able to tell where friendship ended and the business relationship started. He might have better luck in Civil Court because the standard to win there is much lower- only the weight of the evidence. But as for a criminal case, this would be hard to prosecute and win. That is why I say NEVER EVER EVER hire family or friends to work in your business.

[cpg35223]

Hang on, when it comes to prosecution.

I would definitely get an attorney involved, and make her sign a payback agreement. Heck, make her sell her house and give you the proceeds. But before you press charges, remember that the IRS inserts itself into any worthwhile embezzlement case, and takes its share of the embezzlers proceeds as taxable income BEFORE your friend can get the money back. So prosecution is really a last gasp.

However, if the embezzler's husband is her accountant, you have an excellent recourse. Your accountant, like most professionals, probably has Errors and Omission insurance. That means you can sue the accountant and the insurance company may be able to cover the losses. Then the insurance company will probably prosecute.

[Driller1]

My business insurance would handle this as a thief. Talk to his agent, I would bet once he files charges, he will get the money, less his deducible.

[sskkc]

I agree that he should speak with an attorney before proceeding.

To put his mind at ease on one front... his wife being listed as an employee is not an issue. Who is to say the wife did not work for the company... her job description could be "consultant" or whatever. This is something many small businesses do to qualify for health insurance. It's not illegal.