In the old days of the Wild West, the “bad guys” were usually bank and/or train robbers, and cattle rustlers.
The U.S. Marshals (and the Pinkertons) focused pretty much on catching the bank and train robbers, leaving the poor ranchers on their own to deal with them lousy rotten cattle rustlers. (Cattle rustlers were usually cowboys gone bad).
Now imagine for a moment, the anger that would rise up in the face of any good, honest cowboy when they came up on a cattle rustler. It was like watching Dr. Jekyll become Mr. Hyde. That nice, friendly, docile cowboy would get mighty riled up over catching a cattle rustler. They had a simple solution to stopping them back then ... they hung ‘em!
Now, today small business owners would match up pretty close to the good ol’ cowboy of years past. They work hard, they’re honest, they try to please their customers, and they treat their employees like family. Along comes the employee (who has gone bad, unbeknownst to the business owner) who starts stealing, or, as we call it, embezzling from the boss. Usually a small amount at first, but it gets larger and larger until, one day, the embezzler gets caught. Oh, yes, folks. Just like cattle rustlers of bygone days, the embezzler eventually gets caught.
Unfortunately, the embezzler usually has done some painful damage to the small business owner by the time they get caught.
We just had another client come in recently, his secretary of more than 28 years turned up embezzling more than $500,000 from him! Ya think his response upon finding out was to reminisce on the good old days when you could just string up those cattle thieves?
If he had followed a simple rule we kept telling him to do, this probably wouldn’t have ended so badly for him.
The rule you say? Have the business bank statements (including front and back pictures of canceled checks) mailed to your home. Open it, look it over, make sure all the canceled checks are your signature; then give the bank statement to your friendly CPA and have them perform a monthly bank reconciliation before passing it over to your bookkeeper. Our client kept saying he didn’t want to pay us for that simple service. Now he says he wished he had!
You have a choice. You can gamble all your employees would never embezzle from you, or you can get smarter and start by at least following the simple rule above. Don’t put it off! Those embezzlers, they are out there. Problem is, they look just like honest folks. Since they don’t walk around with a sign on them saying, “I’m stealing from you,” you have to catch them!
Did you hear? Proverbs 11:19 — “As righteousness leads to life, so he who pursues evil pursues it to his own death.”
Kelly Bullis is a Certified Public Accountant in Carson City. Contact him at 882-4459. He’s on the web at BullisAndCo.com and on Facebook.
