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Home > Cases > The Disappearing Discs > Findings & Recommendations


Internal Theft Investigation Case Study: Findings and Recommendations Report

Internal Theft Investigation: Findings and Recommendations Report, Case Studies, Summit Loss Prevention Consulting, Inc., Indianapolis, Indiana (IN)


As part of the investigation in the case study "The Disappearing Discs", a preliminary investigation report with an initial set of findings was submitted, with recommendations made to improve employee theft prevention in the future.

For those interested in the complete details of the case, we present the final Findings and Recommendations Report submitted to the client.

(Note: All names and locations have been changed to protect the privacy of those involved.)

Compact Disc Manufacturer Findings and Recommendations Report

The firm is conducting an internal investigation into theft of product from the disc manufacturing facility in Central Indiana.  As a result of the investigation, with the goal of deterring and/or identifying future incidents of theft, the firm wishes to submit a Findings and Recommendations report for company management review. 

This report will identify the causes and effects of internal theft at the facility, as well as outline loss prevention recommendations that the firm is prepared to implement in the facility. 

Investigation Summary

The internal investigation at the Company has required approximately one month to conduct.  It has involved dozens of interviews, including several with the local Police Department, police informants, retailers and wholesalers in the area, former employees who had been terminated and/or arrested for theft from the facility, Company management staff, and numerous current Company supervisors and employees. 

The investigation, to date, has resulted in 23 employees’ written admissions to theft of DVDs, high-end video games, and audio CDs.  In addition, several former employees have been identified as having been involved in theft from the facility during their employment period.  The specifics of these individual employee interviews have been documented in a separate report. 

During the interviews with managers, supervisors, and employees, it was determined that there is an overall lack of security awareness at all levels.  Also, two potential, physical security issues were raised, as well as the issue of the Company security officer’s responsibilities in relation to combating employee theft from the facility.

Internal Theft Investigation: Findings and Recommendations

  1. Finding: Employee Attitudes 

    The finding is that many employees perceive that the company isn’t doing enough to combat theft issues in the facility.  Interviews revealed that employees know there is a theft problem among the workforce and they are concerned about it.  However, they are unsure what, if anything, they can or should do about it.

None of the employees interviewed were aware of the company’s ‘anonymous information’ phone number that can be used to report suspicions of theft.  Also, it was determined through interviews with supervisors and management that several employees had confided suspicions to them that were not documented or acted on with any real sense of urgency.  In many of these cases, the management was not certain how to respond and chose to do nothing.  Supervisors and managers reiterated many of the employees’ concerns and frustrations. 

Recommendations: The recommendation is that the firm be retained to conduct loss prevention training and orientation for employees, supervisors, and managers relative to theft issues in the facility. Specific areas of training to focus on include:

  1. The training would be specifically relevant to the group in question.  Hourly employees would be educated on awareness of theft among their co-workers and how to respond to that circumstance.  This training would provide a strong deterrent to theft in itself by letting the employees know that Company management is serious about reducing or eliminating theft in the facility.  It would also have the effect of promoting the responsibility of employees to notify management in the event they become suspicious or directly aware of theft and reduce the legitimate fear many employees have of being branded a ‘snitch’ or ‘narc’ by their peers.

  1. Training for supervisors would focus on their role in staying alert and aware of theft issues among their group, as well as instruct them on how to handle specific instances they may be confronted with.  Many supervisors actually avoid discussing theft issues with their subordinates because they simply aren’t comfortable with the issue and don’t want to become involved in something they are not trained to pursue or resolve within the current scope of their job.

  1. Orientation for managers would focus on issues of case management strategy, documentation of information, communicating in a timely manner, confidentiality issues, and avoiding employee reprisals.  The managers should be trained to offer consistent, recurrent reminders to their supervisors about potential theft issues and help the supervisors establish and maintain a pro-active environment among the hourly employees, as outlined above.

  1. Specific situations will be discussed and reviewed at all levels to establish a ‘comfort zone’ for each group receiving training.  Ample time for questions will be provided to further enhance the training and cover as many ‘what ifs’ as possible.

  1. It is strongly suggested that these training sessions be conducted on a quarterly basis to maintain a consistent deterrent among the workforce.  Through attrition and promotions, the individuals who fill specific roles within the facility change over time.  New hires and those promoted from within are important employees to put through the orientation process.  The firm also offers ‘train the trainer’ sessions in an effort to introduce the concepts and principles to those who may eventually interact directly with employees in this process.
  1. Findings: Employee Handbook

    The specific findings for improvement of the company's employee handbook are:

  2. A. The Employee Handbook does not contain any specific language concerning an employee’s ‘responsibility to inform’ management of known or suspected instances of loss to the company. 

Recommendation: The recommendation is to include this item among expected employee behaviors in the Handbook. This clause, which relates to internal theft, vandalism to equipment, and/or destruction of company property, provides a reasonable framework that employees can utilize when making the decision to inform management of their awareness of these type of situations. 

B. Many employees have the attitude that company losses are ‘not my problem’, and feel comfortable doing nothing to help reduce known or suspected losses to the business.  Granted, many employees will continue to ‘look the other way’.

Recommendation: Identifying the company’s position to hold them responsible for their awareness of issues causes a certain percentage to notify management of problems. It is a first step toward employee accountability for knowledge of theft by co-workers.  Would-be thieves may also consider this when making the decision to become involved in theft from the Company.

C. There is no specific information in the employee handbook related to security inspections of employees as they depart from the facility. 

Recommendation: Provide adequate information as to what employees should expect, and why the Company endorses such inspections. This is helpful in diffusing objections to the security officer's responsibilities during this process. 

Discussing this procedure, and the employee's responsibility to cooperate fully with it, will cause a deterrent effect to theft and lay a foundation for the Company's position on theft and security measures in the facility.

D. The company’s anonymous ‘tip’ line is not known by employees, not promoted by management as a loss prevention tool, and therefore not utilized to its full potential by the workforce concerning matters of theft or loss to the Company. 


Recommendation: To publish the number in the Handbook and promote its use to all employees for these circumstances.  This phone number provides anonymity to employees, which increases the likelihood of their providing useful information.

  1. Findings: Physical Security Enhancements 

    The specific findings pertaining to physical plant security were:

    A. The current CCTV system, with some real and some ‘drone’ cameras, is not sufficient for its intended use of deterring or detecting internal theft. 

    Recommendation: Additional cameras should be installed, both in the highly visible ‘domes’ and in covert placements as well. Investigators are available to consult with the Company’s camera provider to identify the areas most at risk. 

    Covert camera placement in areas identified as high-risk will assist the company detect internal theft. In addition, procedures for monitoring the cameras need to be established for the security officers to realize the full potential of the system.  Officers should be thoroughly trained on the CCTV system and held responsible for viewing the monitors in an effort to detect internal loss issues.

    B. Metal detectors, or ‘wands,’ are not being utilized by security officers to deter and/or detect potential theft of aluminum-backed discs from the facility. 

    Recommendation: Research the most current technology and determine if there is a device available for this application. Once that has been determined, procedures should be implemented to provide structure to this process.  

  2. Findings: Security Officer Responsibilities

    The current job responsibilities and/or execution of those responsibilities by the security officers are not sufficient to deter and/or detect instances of employee theft from the facility. 

    Recommendation: our final recommendation is that the firm's investigators incorporate their awareness of the most recent examples of internal theft, their knowledge of appropriate person and package inspections, and the current directives to the security officers into a revised set of ‘Post Orders’ for the officers to adhere to, which will enhance their ability to deter and/or apprehend future instances of theft. 

    This process would include the officer’s supervisor, or his designate, to insure uniformity and consistency among any officers assigned to the Company facility. 

The firm's personnel will discuss this Findings and Recommendations report with Company management at their convenience.  The Director of Special Investigations, Tony Jarana, is prepared to begin implementation of these recommendation proposals immediately.  Mr. Jarana can be contacted at (317) 363-8312 with any questions or comments.  Thank you for the opportunity to serve your company.    

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