Loss Prevention: Why Do Staff Steal and How to Minimise it?


Business owners spend a lot of money and time to prevent people stealing, especially shoplifters. However the facts remain that a poisonous employee will do more damage to your business than a shoplifter ever will; loss prevention is key.
Shoplifters generally only take a small number of items at a relatively low value to the business. An employee that has criminal intentions will take more items at a higher value with less chance of getting caught.


Employee Theft

I was asked to investigate why a business was losing so much of its new stock to shoplifters and if I could train the staff in loss prevention techniques. Attending the store I assessed the layout and access points to begin my risk assessment. There is always a chance thefts can be an internal job, for reasons such as:

  • Employees know all the security systems
  • They know what stock is the most valued
  • They have access to the store when no-one else is around
  • They often blame the loss on an unknown shoplifter
  • They know the security guards response


Signs of Employee Theft

Business owners need to make unplanned store visits towards the end of trade and early morning opens so that employees are unsure if they will be caught doing the wrong thing. This is a good way to know what time they start or leave work in any case.
If an employee reports a shoplifter stole certain items you need to request a report with full details, including:

  • What time did the shoplifter come into the store?
  • What time did they leave?
  • How did the employee know that they were the ones that stole the items?
  • Was anyone else in the store at the time?
  • Did your employee get details from witnesses?
  • What is the full description of the shoplifters, and
  • More relevant details like these.

Quite often the employee blames a shoplifter for this but will provide very vague or incomplete details about the shoplifters and events. This is because they don’t really want anyone caught for it and if they give too many details to security guards they may arrest the wrong person. The employee would then have to explain why the shoplifter wasn’t even in the store. The employee is hoping that you will just record it as shrinkage and leave it at that.


My Investigation

In this particular investigation, I found that the employee was always taking a box of rubbish to the bins after they had locked the store for the day. I followed the employee and found that they went near the rubbish bins to a parked car. He preceded to open the car’s boot and place several items of clothing from the box of rubbish into his boot. The box was then thrown in the bin. He drove the car away.
The items of clothing added up to thousands of dollars as this ‘process’ was performed frequently. I continued with the surveillance and gathered all the evidence. On the third night we had the police arrest him while he was loading up his car boot.


Cost to Business

You spend time and money trying to stop this alleged shoplifter when in fact it is your employee that is stealing from you. All the time talking to security guards and police trying to find out why they can’t stop the thief, the employee is listening to your plans and knows how to not get caught.


Saving Someone Else

If you catch your employee stealing you need to take legal action against them so that they are held responsible for their actions and possibly preventing them from stealing again. Often managers will just ask the employee to resign. This is dangerous because the employee will just go work somewhere else and do it again. Think about this carefully.
If you don’t terminate them and just get them to resign, is it likely that other businesses similar to you will do the same. This means that the new employee you are hiring might have been caught for stealing before, especially if they are working in the same industry as yours. If they have no criminal record there is no way for you to know if they have stolen before.


Reducing Your Risks

Conduct a full employee risk assessment on all employees in a position of access to your valuables. This is not a reference check, but a thorough risk assessment on their past work history and any potential trouble areas the assessor may uncover. It is worth spending some money and making sure you don’t employ someone that will steal from you.
Always check in detail why they left their last two positions, especially if less than 12 months of employment history with one employer.
Install CCTV systems in the store and don’t let them see what areas the cameras cover. You need to conduct random reviews of the CCTV to assess your risks and potential thefts.

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