One Is, One Would and One Would Not

BY MARK S. GLOCHOWSKY

“Why Employees Commit Fraud,” ( JofA, Feb.01, page 89 ) leads me to ask a closely related question: Who is most likely to be an embezzler?

According to the “rule of thirds,” a third of your employees are stealing from you right now, a third are kept in check only because of effective controls in their area (they would steal if they thought they could get away with it) and the last third are people who are honest and would never steal from you.

Invariably, after a fraud has been discovered, the victims all say the same thing: The embezzler was in a position of trust, and I never would have suspected him or her.

These are some of the characteristics or habits that embezzlers seem to have in common:

They are control freaks—they don’t want anyone scrutinizing their work. They work long hours and are unwilling, or may refuse, to take vacations because they need to spend a lot of time covering up their thefts.

Many embezzlers display signs of depression and experience mood swings because of the inherent stresses of this type of crime.

Frequently, an embezzler will be living beyond his or her means, claiming to be a lottery winner, a recipient of an inheritance or settlement or a proprietor of a lucrative side business. If a clerk who is earning $25,000 per year drives a Porsche and wears Armani, that should be a tip-off.

Embezzlers are not usually motivated by simple greed. Usually, there is some underlying vice such as gambling or drugs or the involvement of a girlfriend or boyfriend. The embezzler, who may have reached the end of his or her rope, is ready to try something desperate.

Mark S. Glochowsky
Senior Accountant
Gerber Plumbing Fixtures Corp.
Lincolnwood, Illinois

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