Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!americast.com!americast.com!americast-post Newsgroups: americast.wpost From: americast-post@AmeriCast.Com Organization: American Cybercasting Approved: americast-post@AmeriCast.com Subject: Protection From Pilfering Employees; Screening of Applicants, Other Measures Date: Mon, 16 Nov 92 05:02:45 EST Message-ID: <81.1992Nov16.050246@AmeriCast.com> Protection From Pilfering Employees; Screening of Applicants, Other Measures Can Prevent LossesBy Marianne KyriakosWashington Post Staff Writer All was not sweet for Reginald Lancaster. His Skittles had scooted. His Dum Dums had departed. His Hersheys were hijacked. His Gummi Worms had wandered. Lancaster, manager of the Candy Barrel shop in Silver Spring's City Place mall, believes he was a victim of "shrinkage," less politely known as employee theft. "I don't think there is anyone who isn't affected by it," Lan- caster said. The Commerce Department estimates employees will steal $40 bil- lion in funds and inventory from businesses in the next year. And the agency predicts that figure will rise 15 percent a year. Twenty percent of all business failures are blamed on employee theft, the American Management Association says. The challenge for owners and managers begins before an employee is hired. About 20 percent of applicants will steal from their employers while 60 percent of potential employees are "extremely trustworthy," said Jim Powell, president of the Stanton Corp., a Charlotte, N.C., company that specializes in employee testing and assessment. The remaining 20 percent, he said, could go either way. Candy store manager Lancaster attacked his problem by firing one blatantly sticky-fingered employee as a tough example. "I tracked her down by her work conduct and register overages and shor- tages," he said. Lancaster then instituted a policy, with the owner's blessing, of encouraging employees to sample and taste - on premises - from the colorful bins of sweets. He also gives each worker a half-pound of candy a month to take home. This familiarizes workers with their wares. "You figure if we are giv- ing it to them, there is no need to steal anything," he said. Lancaster also tightened screening of applicants. "I do close reference checks," he said. "It's a trial-and-error deal, but the negatives come out." Extra protection from pilferage comes from the Reno, Nev.-based firm that owns Candy Barrel Corp., which keeps tabs on telephone receipts and other controllable costs. Sometimes more extreme measures are called for. Leslie Lytle of Accessory Place Co. said the sparkly earrings and glittery barrettes she sells are so pretty and portable that they "walk" out of the store at a fast clip without close attention. The Washington district manager of the New Jersey-based firm has associates log in their own jewel- ry, rings and watches with the boss when they arrive for work. Bags and purses are checked - coming and going. Asked how employees feel about the scrutiny, Sophie Phillips of Accessory Place's Wheaton Plaza store shrugged and said the work- ers go along because it's a job requirement and most believe they have nothing to hide. "We might have a problem if they start frisking us, but that hasn't happened so far," she said. "The things that hurt the most are when management people are doing it," Lytle said. "You tend to trust a management person, and those are the people who can burn you the hardest." CIMA Cos., a risk-management group in Alexandria, offers the following tips for small businesses: Conduct periodic inventory counts. Maintain basic authorization controls - know who has access to what information on the computer network, restrict authority for bank transfers, require two signatures on checks and lock drawers. Have a well-designed paper or magnetic tape trail. Watch for red flags that could mean a breach. Hand out written procedures that include the internal controls and make sure new employees under- stand the rules. Post a written policy covering discipline of violators. It's a matter of good communication of expectations," Lancaster said.<03:18 11-16C9999----- Copyright 1992, The Washington Post. This story is from the Washington Post's Capitol Edition On-Line and is not to be ar- chived or redistributed. For more information, send-email to American Cybercasting Cor- poration (usa@AmeriCast.COM)