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",
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
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.
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
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
Internal Theft Investigation: Findings and Recommendations
Finding: Employee Attitudes
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.
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:
- 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.
- 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.
- 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.
- 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.
- 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.
Findings: Employee Handbook
The specific findings for improvement of the company's employee
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’.
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.
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.
Findings: Physical Security Enhancements
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.
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.
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
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
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
How to Prevent Situations Like This
For more information, call 317-363-8312, send email to
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