Employee fraud can seriously affect any business; the construction industry is no exception. We have discussed this numerous times in our podcasts and blog posts. Unfortunately, we still get calls from construction business owners who unknowingly become victims of this financial nightmare. That is why it is important to revisit this topic and emphasize the need to be proactive and vigilant so it doesn't happen to you.

 

Identifying warning signs of potential employee fraud is crucial for maintaining your company's financial health and integrity. Unsurprisingly, the highest-risk employees for fraud have trusted roles in financial services: Accounts Payable, Accounts Receivable, accounting, and bookkeeping.

 

To commit fraud, or in this case, embezzlement, an employee must have both access and opportunity—that is, access to funds, banking records, and accounting data. The ideal situation is for someone entrusted with multiple roles who can cut and sign checks, process accounts payable, and handle bank reconciliations.

 

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Topics: Bookkeeper Embezzlement, Embezzlement, Contractor Bookkeeper Embezzlement, Construction Bookkeeper Embezzlement, Employee Fraud, Employee Theft, financial fraud

Mistakes can be expensive in the construction business, and as an entrepreneur, although you'll know many of the regulations that apply to your business, there are so many that you can't possibly remember all of them. Depending on the type of contracting business you run, you could face laws regarding taxation, employment, product liability, premises liability, discrimination, health and safety, and various other regulations.

 

Keeping on top of all the laws that affect you and the changes to those laws while still being mindful of all the other aspects involved in running a business is almost impossible.

 

That's why you need legal help. A legal professional can identify the rules and regulations that apply to your business and advise you on operating within those laws. They can also help you draw up necessary contracts that could prevent legal action in the future, and they can prepare a case in the unfortunate event that you wind up facing or filing a lawsuit.

 

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Topics: Bookkeeper Embezzlement, Embezzlement, Contractor Bookkeeper Embezzlement, Construction Bookkeeper Embezzlement, Employee Fraud, financial fraud

As a small business owner, you always look to keep your company running efficiently. Expense reimbursement fraud is the last thing you want to face. Not only can it hurt your bottom line, but it can also damage your construction company's reputation. Here we discuss employee expense fraud, the reasons behind it, and, most importantly, how to prevent it from happening to your construction business.

 

What is expense fraud?

 

Expense fraud is submitting falsified or inflated expense claims to receive reimbursement from the employer or avoid paying out of pocket. It is illegal, unethical, and detrimental to your business.

 

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Topics: Bookkeeper Embezzlement, Embezzlement, Contractor Bookkeeper Embezzlement, Construction Bookkeeper Embezzlement, Employee Fraud, financial fraud

Recent employee theft statistics are increasing, and small business owners are more vulnerable to the problem. The most common embezzlement methods include billing fraud, cash on hand, and check tampering.

You may not know how employees can steal from you as a construction business owner. Some standard methods include:

• redirecting company checks to personal accounts and altering entries to cover up the theft
• undercounting change to customers and keeping the balance
• seeking reimbursement for non-business related expenses or 
• pocketing inventory or supplies.

Just as you can't be 100% secure all the time, there is no way to eliminate 100% of the embezzlement in your contracting company. However, you can limit your losses and avoid most of them with suitable preventative measures.

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Topics: Bookkeeper Embezzlement, Embezzlement, Contractor Bookkeeper Embezzlement, Construction Bookkeeper Embezzlement, bookkeeper theft, Employee Theft

Billing schemes. Skimming. Check-tampering. Employee fraud is a real risk for businesses with fewer than 100 employees. In fact, according to the Association of Certified Fraud Examiners, small businesses lose almost twice as much per scheme to occupational fraud.

If you Google Search "Construction Bookkeeper Embezzlement," you will see thousands of hits, and most of the problems construction companies suffered could have been avoided if the owner had known about and followed a few simple guidelines.

Unfortunately, until a contractor has gotten to know us, they tend to think of us as just another contractor's bookkeeping service. This means some contractors think we are crazy to suggest that any trusted employee, especially an in-house bookkeeper, would steal money from their company, and so they ignore us until it was too late.

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Topics: The Contractors Account, Bookkeeper Embezzlement, Embezzlement, Systems And Processes, Contractor Bookkeeper Embezzlement, Construction Bookkeeper Embezzlement, Contractor Tips, Employee Fraud

Bookkeeping embezzlement stems from a feeling of entitlement and the need to get even. Your bookkeeper or accountant will steal if they feel confident they can get away with it and if circumstances allow for it due to weak integrity and a sense of "Redistributing The Wealth, But Not The Work Or The Responsibility."

 

It is estimated that the number of bookkeepers caught embezzling from contractors is less than one percent of the total. In most cases, the ones that are caught are rarely convicted because all too often, it is the contractor who has to spend thousands of dollars on forensic accountants and attorneys to prove the theft occurred.

 

In most cases, it is near impossible to persuade the authorities to prosecute when a contractor bookkeeper embezzles because it is often viewed as a "Victimless Crime."

 

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Topics: New Contractors, Bookkeeper Embezzlement, Embezzlement, Construction Accounting, Contractor Bookkeeper Embezzlement, Construction Bookkeeper Embezzlement, Contractor Challenges, Contractor

It Makes Perfect Sense For You To Delegate All The Mind Numbing

Contractor Bookkeeping Service Tasks As You Can!

All Contractors will experience embezzlement at some point in their business life if they stay in it long enough. How much money will be lost is easy to predict.

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Topics: Bad Bookkeepers, Embezzlement

An Alarming Number Of Construction Company Owners Are

Being Ripped-Off And Driven Into Bankruptcy!

That sounds harsh but it is true! Whenever we see a contractor is heading toward a problem, issue or disaster we immediately raise an alarm. We are judicious about doing it so when we say there is a potential problem our clients know we are serious.

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Topics: Bookkeeper Embezzlement, Embezzlement, Contractor Bookkeeper Embezzlement, Construction Bookkeeper Embezzlement

“A recent study found that business school education not only fails to improve the moral character of the students, it weakens it. ..students were asked, if given a chance of being caught and sent to prison, they would attempt an illegal act that would net them a profit of more than $100,000; more than one-third responded ‘yes’.^"

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Topics: Bad Bookkeepers, Bookkeeper Embezzlement, Embezzlement, Bad Construction Bookkeepers