Embezzle: to appropriate fraudulently to one's own use, as money or property entrusted to one's care.
Every so often a case of embezzlement is reported in the media. The latest involves a well-known and large personal care products company and one of its senior employees - a deputy general manager. The employee is now in custody for supposedly ordering gold coins worth 25 crore rupees as part of the company's incentive programme. He, however, kept them for himself. In acquiring these coins the fraudster forged signatures, created false purchase orders and emails.
Such cases make the news only if the amounts are large or the company is familiar to the public. In truth, employee related fraud and embezzlement is all too common. They don't get reported because companies want to avoid the loss to their reputation and credibility.
The problem is startlingly big and businesses of all hues need to be alert to the risks. With nearly a third of bankruptcies caused by employee related theft there is no room for complacency. An industry study has revealed that eighteen percent of frauds are committed by executives or upper management and are particularly painful. It takes on an average two years before theft or misappropriation, of company assets by workers, is detected. That is reason enough to conduct continuous and periodic checks of serving employees. These practices are crucial for companies to ensure their integrity, credibility and reputation. The price for lack of continuous vigilance could be the bottom line.
There is another dimension to employee related theft and embezzlement. Lack of internal controls leave businesses open to exploitation by unscrupulous employees. It is essential for the continuing health of companies that they establish rigorous periodic employee checks and put in place strong and structured fraud prevention programmes.
and hopefully avoid the lawsuits and pain that the above mentioned company is now going through.