Protect Your Business Against Employee Fraud

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Employee theft is surprisingly common and can devastate your business. Consequently, it is worthwhile to put an anti-theft program into place, which includes internal auditing and monitoring. By following a few Do's and Don'ts you can minimize the risk of employee fraud.


  • DO regularly review your financial statements.
  • DO deposit your cash and checks daily.
  • DO secure your blank checks and signature stamps.
  • DO carefully monitor a new employee who is responsible for buying goods.
  • DO periodically have an individual hand out payroll checks and confirm that absent employees are actual employees.
  • DO periodically compare payroll payees with employee records.
  • DO regularly review bank reconciliations.
  • DO distribute responsibilities among employees so that a different employee collects receipts, makes out deposit slips, reviews bank statements and writes checks.
  • DO periodically open your own mail and compare payments received with deposits.
  • DO periodically hire an outside accountant to audit your books.
  • DO require two signatures on checks over a certain amount.
  • DO review billing error complaints from customers.
  • DO require that original invoices be kept in the files.
  • DO maintain and monitor a list of your property that is subject to theft.


  • DON'T allow accounting personnel to work longer than a year without taking a vacation.
  • DON'T sign blank checks.
  • DON'T hire employees without checking references.
  • DON'T sign checks for new vendors without verifying their name and association with your company.
  • DON'T allow transfers between accounts without verification.
  • DON'T sign checks without reviewing and canceling paid invoices.

By, FindLaw

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