Wed, March 20th, 2013 - 10:23 am - By Gordon Basichis
Employee theft has been on the increase, especially after the economic downturn. Employee theft can not only prove damaging to your business through loss of funds and proprietary data, but it can dramatically hurt employee morale and instill fear and lack of confidence in your customers. The collateral damage created by employee theft is one of the reasons that some companies will try to sweep it under the rug. Sometimes you can sweep it under the rug, and sometimes the damage is too great for discretion, and then sometimes it goes public. Not good.
Background checks can assist employers in determining if a job applicant had prior criminal records or there are indicators in his history, references, lies about education, whatever, that he may have a penchant to steal. But while background checks are useful for employment screening, let’s face it, there is a first time for everything. I have written about employee theft on a number of occasions. One such article is When Employees Rob You Blind, which by the title should indicate the content.
So now we have but one more white collar crime. For employment screening purposes, white collar crimes are best searched at the county criminal level but also the federal criminal records searches and federal civil records searches. Often, while the suspect is accused of a crime, the U.S. Attorney will move the case from criminal court to civil court where he hopes, especially with complex cases, he can get a conviction. It takes twelve jurors to convict in criminal court, but only eight jurors to convict in civil court.
In this instance, a former commodities broker stole over $215 million from his client’s funds. He is awaiting sentencing. The crime took place in Iowa, a long way from Wall Street. But embezzlement and financial malfeasance is universal. As our the thieves who are convicted.
According to the article in USA Today….”Russell Wasendorf Sr. will be sentenced on Thursday for stealing $215.5 million in customer funds from Peregrine Financial Group, the commodities brokerage he ran for many years out of Cedar Falls, Iowa. Over the course of that time, Wasendorf’s crimes affected the more than 10,000 investors who traded via Peregrine as well as the 300 employees who lost their jobs after he filed for bankruptcy. Wasendorf faces life in prison. His sentencing follows a guilty plea entered on Sept. 17 on four felony charges, including mail fraud, embezzlement of customer funds, and two counts of lying to regulators. Experts say the Wasendorf case highlights the need for better regulation of futures and commodities trading. Bart Chilton, a commissioner at the U.S. Commodities Future Trading Commission, has asked Congress to raise the fine for each instance of misconduct from $140,000 per violation to $1 million per individual and $10 million for an institution.”