Is Your Business Ripe For Embezzlement?

Most successful small business people have one thing in common. They excel at running the production of the business, be it products, services, or being value added retailers, but they hate to manage their business.

According to the Small Business Administration (SBA), if you have reached the 4 year mark, you are in the 50% Club. At 6 years, you are in the 40% club of businesses that have been successful.

So here’s the scenario: you are making money, but the management of the business is getting in the way of expanding. You decide to hire a financial person to run the routine stuff necessary for any business to function. You hire a “miracle worker” who takes over accounts receivable, starts getting your customers to pay their bills, keeps your suppliers happy and fires the payroll service as they can handle it, saving you money.

You are ecstatic, and you get to do what you love – build your business.

Believe it or not, you are ripe for embezzlement. Here is what can happen.

Your “miracle worker” gets you to sign over signature authority for the checkbook. Initially, this is just for checks for $500 and under; then, you come up with the brilliant idea of allowing this person (who after all, is doing such a great job) to sign all checks regardless of amount.

The miracle worker is so good that answering the phone and mail sorting and handling become their added responsibilities. It relieves you of that chore, saves you time and brings organization to your office. All is right with the world, you are told everything is great-it’s a banner year.

Then, one day your miracle worker is out ill. You end up answering the phone, and are startled by creditors’ calls telling you the bills are not getting paid. You open the mail, and it is full of overdue notices from creditors, the IRS, and your biggest account.

When the miracle worker returns to work they explain it all. The other companies are overreacting to checks lost in their internal processing. They’ll get it all straightened out and have a full report upon your return from a business trip. However, instead of a full report, you find the financial records, computer, checkbook, receipts, tax records, and personnel folder for your miracle worker have vanished. You immediately try to reach your miracle worker, but they cannot be located.

You then call the local law enforcement and file a report. They do the best they can, but it is now your word against the “miracle worker” who has hired a lawyer. The attorney sends a threatening letter stating you have no proof of wrongdoing and they intend to sue if any action damages their client’s professional reputation. Local law enforcement is already swamped with white collar crime investigations, and it will be at least a year before they will be able to act on your complaint.

Now where do you go for help?

Most small businesses just give up as they figure they will never recover the embezzled funds anyway and they become busy just trying to save their remaining business. Do not be silent – criminals are counting on that!

There are multiple levels of investigation beyond filing a report with your local law enforcement division.

Report the crime to the US Post Office as there is a better than even chance that the US mail was used in this criminal action. Postal Inspectors have their own investigative methods.

Report the crime to the county sheriff and prosecutor’s offices. They are a separate law enforcement entity, and may be looking at other activities involving your “miracle worker” that local law enforcement has no knowledge of. Also, within certain constraints, the FBI will investigate white collar crime. There is a dollar limit that needs to be crossed before federal officials will get involved, but it costs nothing to ask for their help.

Get every level of tax officials from the IRS down to the city (if applicable) informed of your problems. They have their own investigators and access to records that others do not have.

Be sure to include your banker in any fraud investigation. Banks have their own internal investigation resources and while they may not release any internal audit information to you personally, they do cooperate with law enforcement.

Also, call your local SCORE office or go to and ask for free business counseling. SCORE is a nonprofit association dedicated to entrepreneur education and the formation, growth and success of small business nationwide. They will help get you back on your feet, and will give you advice that will help prevent this from happening again.

Now, what exactly can you do to prevent this problem? Several very easy steps will save you a ton of headache later.

1. Run your business! Look at and understand the weekly financials.
2. Have someone other than your miracle worker open ALL the mail and review it. Instruct that any late notices from vendors be brought to your attention immediately.
3. Have someone other than your miracle worker answer the phones. Keep a phone log of all incoming calls so you can track vendor relations.
4. Force your miracle worker to take vacation at least twice a year.
5. Implement internal controls by having duplicate paper.
a. One copy follows money to receivables file or cash sale.
b. The second copy goes to bookkeeping to record the transaction.
c. Periodically, compare these records to ensure the numbers match.
6. When delegating, check writing authority, limit the amounts to $500 or less.
7. Do not give payroll advances. It is too easy to skip the repayment.
8. Watch for duplicate payments to the corporate credit card bill.
9. Spend the money on an external audit by a different accounting firm than the one you are currently using, if you are using one at all. If your miracle worker says this will be a waste of time and money, change the locks on the door and call an auditor ASAP!

There are many more items you can and should implement to safeguard your business, but this list will give you a good start. If you recognize yourself or a friend’s business here, call and get help immediately.

Theft – A Crime in Many Forms

Theft usually describes any situation where one person takes another person’s property illegally. Although theft is almost universally regarded as a crime, it comes in many different forms: shoplifting, embezzlement, and burglary are all considered theft. Some forms of theft are taken more seriously than others, and the range of punishments can vary greatly.

Shoplifting is the crime of taking merchandise from a retail store without paying.While it is considered by some to be a lesser form of theft, it can still carry stiff legal penalties. The severity of a shoplifting offense, as with many types of theft, depends on the value of the merchandise taken. Shoplifting is often punished with fines, community service, or probation, but it can also result in time behind bars, especially for repeat offenders.

Burglary and robbery are two more serious forms of theft. Burglary is technically defined as the illegal entry into a property with the intent to commit a crime of any sort, but most often it burglary is done with the intent to steal. Robbery is theft involving the use of violence or intimidation tactics. Armed robbery, which involves the use of deadly weapons, is a more serious offense.

There are other types of theft that do not involve stealing property or money in person, but instead happen at a distance. This includes a number of “white-collar crimes,” so called because they can usually only be committed by people in managerial positions.

Embezzlement, for example, is the illegal taking of financial assets you have been trusted with. In order to embezzle money, it is necessary to be in a position where you are trusted with large sums of money in the first place. There are other crimes that can be committed by people with fewer resources, such as fraud and identity theft.

People who have been charged with theft, no matter what the form, are entitled to effective legal defense. Regardless of the charges, everyone in the United States is to be considered innocent until proven guilty.

For more information on subjects related to crime and criminal defense, visit the website of the Houston criminal defense lawyers of Johnson, Johnson & Baer, P.C.

False Billing and Embezzlement

Embezzlement charges are given to employees of businesses who create false invoices for their own financial gain. This is a crime that is harshly punished in the courts. Because of the severe consequences of this crime, defense attorneys are used to help defendants fight to overturn the charges against them or secure reduced sentences. Proper evidence that the crime was committed is the only way for the prosecution to succeed in their case. If found guilty, at the very least, the person will be held responsible for the financial damages they caused an individual or business.

Many people in high positions have access to the accounting records of their company. This is why it is often referred to as a “white collar” crime–because it is typically associated with individuals who are in managerial or supervisory positions.

One example of false billing includes an individual sending false invoices to the clients of their company. They may fraudulently make claims on the invoices that the bills are to continue a company’s service or simply try to take advantage of their client’s careless bookkeeping. These invoices will instruct these clients to send checks to P.O. boxes. Individuals then pick up these checks and deposit the money into different accounts.

Discovery of this crime will lead to an arrest and could result in a trial. In order to convict a person of this crime it must be proven that they intended to cause financial damage, took advantage of their position, and misappropriated the funds for personal financial gain. If these things cannot be convincingly demonstrated by the prosecution, it may be possible for a person to have the charges against them dismissed altogether.

If you have been charged with embezzlement, visit the website of the San Jose embezzlement defense attorneys at The Jensen Law Office for more information.

Criminal Law and Its Scope for Defense of a Country

Criminal law includes the rules and regulations related to crime. It includes all the jurisdictions that are imposed by the government because it may be harmful for the welfare of common people. The people who commit such crimes are punished whether capital punishment, physical or corporal sentence or imprisonment. All such policies and prohibitions are made by sovereign or any separate department responsible to manage these affairs. Criminal law is different from civil law as it is based on totally different objectives. If in a country the law is properly implemented and practiced then there is hardly any exploitation or corruption in the economy. There are different types of crimes white collar crime, healthcare crime, internet crime, tax crime, economic crime, etc.

Criminal lawyers may deal with people whose business reputation, goodwill, social status is at stake. Cyber crimes may charge you to serious penalty. If anyone is charged to offences relating tax liability, nonpayment of tax, tax evasions, etc the lawyers deals with such cases very professionally to protect the clients. The crimes related to merchantability or wholesomeness may render the criminals to heavy penalty. The cases may be referred to appellate tribunal for hearing of appeals and verdict announcement. The lawyers are well qualified and are approved by passing bar examination. The lawyers must be selected by thorough examination of their background and their skills regarding the specialties. If there are situations related to business insolvency, bankruptcy, or firm liquidation, auditors misfeasance, etc all such cases are very sensitive and requires a detailed care and diligence on part of the lawyer to protect the plaintiff. The convict whose crime has been proved in the court the lawyers also tackle their cases very professionally. The technicalities of lawyers and their defending power prove very useful for their clients. No matter what the case is the lawyers handles the situation very professionally.

If the plaintiff or defendant is wrongly accused in any case the criminal lawyers tackle the case very competently. Murder, assault, insolvency, embezzlement, burglary, stock misrepresentation, etc these are some cases of crimes. In the criminal law there are two types of lawyers one is criminal defense lawyer and the other is prosecutor. The defense lawyer provides direction to their clients regarding legal proceedings and they defend the case of those who have been accused of crime. On the contrary prosecutor is the lawyer who works to prove the guilt or fault of the defendant. Prosecutors may gather strong testimonies, proofs, witnesses, evidence to prove the guilt. If a person is accused of theft or any serious crime he must be very careful while finding a loyal and competent lawyer for his safety and freedom from the sentence. The criminal lawyers have to pass a bar exam and many years of training under seniors to be capable of practice. The criminal lawyers are playing their vital role in regulating the security and defense of a country.

Cybercriminals – Cowardly Thugs Hiding Behind Computer Screens

Some criminals attempt to “justify” their thieving propensities by suggesting they don’t take large valued merchandise, or they do it to “test” another’s cyber system. The inference of course is that they are somehow harmless. Criminals typically seek to ruse their law enforcement detractors, or any other person who questions what they do. They rationalize their thefts are non-violent and confined to smaller amounts of dollar losses, for which the items are easily replaced. Their matter-of-fact justifications don’t justify the unlawful taking of someone else’s personal or business property. They’re still criminals none the less and a breach of security means a contravention of the criminal laws.

For the net hoodlum operating in cyber space, their thinking plays an interesting con game, which they later rationalize and excuse as some “noble cause”. Bottom-line though, they’re criminals like their non-virtual counterparts. When caught, they invent all kinds of excuses and whine about their “victimization”. One wonders, when they sit there all day in front of their computers, what part of their anatomy are they really playing with most of the time? Some of these thieves try to scheme us with creative criminality, like “ransomware”, email schemes, credit card scams and other intrusive losses. The list of types of attacks is endless, as is the maliciousness behind the various illicit efforts for unmerited personal gain. Criminals no matter where they operate do so in a self-indulgent passion to misuse and abuse others for private purposes.

As always, one of our critical concerns is the injury, the loss and damages, caused to others as a result of internet criminality. Make no mistake, criminals choose to commit crimes of their own free will for the sake of getting something they didn’t earn or deserve. Make no mistake criminals dislike the responsible nature in others. Electronic breaches of the law are not unlike similar malevolent premeditated street-level crimes, in terms the psycho-dynamics. Some cyber criminals pose a danger to our banks accounts, while others risk the collapse of our economic system. And still others endanger our national security. In the amative stimulation for power and control, criminals will use any means. Like bank robbers or assailants on the street, cyber villains should receive the same levels of punishment. And, their conviction and subsequent sentencing should be sure, swift and certain and for long periods of time.

Criminals freely choose their particular criminogenic instigations. Of which, Cyber-crime involves billions of dollar losses every year to a global community. According to one source, the Internet Crime Complaint Center (IC3), under the auspices of the FBI, in 2007, the agency received nearly a quarter million complaints regarding internet crimes. This likely has increased to more significant levels of late, and represents the tip of the proverbial cyber-criminal iceberg. No doubt a wealth of information flowing through the internet signifies targets of opportunities for criminals.

Naturally, what we often forget is that there is a difference between reported criminality and actual criminality, or otherwise known as the “dark figure of crime”. There’s a sizeable portion of criminal activity that goes unreported and therefore not investigated. Investigatively, law enforcement endeavors to respond efficiently as possible, given the resources available. And yet, the nature of virtual crime is complex, with such diverse challenges, as email and texting scams, business and banking intrusions, to commercial fraud, money laundering and market manipulations.

Electronic thievery, organized crime and terrorism, as well as other associated criminalities, present unique demands for law enforcement. However, valiant efforts continue, and the law enforcement, intelligence communities and private security forces remain undaunted in dedicated persistence. That’s part of the key to an effective investigation, methodical tenacious due diligence in application of effective resources. To rigorously search for every possible clue, cluster and clamor of activity, the investigative process must implement creative and proactive tactics.

Investigators gather the facts and analyze the evidence, apply rationality and reason, as well as ensure the critical implementations of forensic applications. Competent expertise is essential in the utilization of logical deductions. If in doubt as to how to proceed, where to go or what to look for, then efforts utilize those who have the know-how in this particular realm. The hunt for the thugs and terrorists who hide behind a computer screen is never ending. Sinister, wicked and malevolent, with malice aforethought, the “evil” cybercriminals fester adversely affects us all. Countermeasures have to be consistently applied, updated and reinforced. Vigilance has to be tirelessly maintained. You never know when they might strike. An individual, a group or other criminal enterprises, stay relentless in illegitimate pursuits at the expense of others.

To this end, from an investigative standpoint, such activities are still basically crimes against people, places, and properties. So, in a sense, we’re still dealing with the fundamentals of a criminal investigation. None the less, the criminal has taken his, her or their activities into an electronic neighborhood. Within this virtual world, the criminal can inflict horrendous damages to the selected objective.

To deal with such criminals, it is incumbent upon professional law enforcement agencies at all levels, as well as private commercial entities, to invest all available resources where possible, in a “cyber unit”. Special expertise is required within the virtual world of electronic anonymity. Upon development of a “cyber squad”, the next step involves the assignment of qualified staffing. The basics in organizational structure and design remain similar to other managerial frameworks.

That is, you need to plan, organize, budget, development and staff accordingly to fit the needs of the organizational environment. Expert support services should be lined up to assist the investigative team where ever necessary. For which, investigative personnel must either have the technical and tactical expertise, or strive to learn and acquire the essential fundamentals through appropriate educational training resources. Investigators must be determined to ferret out the criminal by enhancing their skills.

Within the scope of “white collar” criminality, organized crime, and particularly those criminals within an electronic landscape, investigating Cybercrime may not seem as glamorous as other investigative processes. Frequently, we forget the impact of commercial crimes (e.g. embezzlement, fraud, identity theft, internet schemes, etc) is ten to twenty times greater than the usual street crimes. For instance, murder, rape, and robbery investigations (i.e. Part I Index Crime of the U.C.R.), while vitally urgent to resolve, tend to be more sensationalized by the various media. More so, than say hacking into the local bank, or stealing someone’s credit card information.

Typically, the new investigator will be searching for action, adventure and excitement. Television and the movies have done much to fuel illusions, misconceptions and less than obvious deceptions about certain types of criminal investigations. Comically, we know that a major crime has to be solved within the telecast of an hour’s worth of viewing. In the real world however, we recognize it doesn’t happen like that. If you think otherwise, good luck and try to forget television portrayals projecting creative crime fiction.

That’s why the right personnel must be selected to fit within the scope of the unique challenges confronted by an ever expanding cyber world. Some investigations may take extraordinary amounts of time and resources to culminate solvability. Effective investigators must assert a high degree of patience and persistence. It might not be too untypical that such cases might require a couple of year’s commitment.

From an investigative perspective, you’ll want quality over quantity, facts instead of fiction and dedication to critical thinking skills. Dealing with a criminological problem necessitates the insistence upon avoiding fallacies of inference for the sake of subjective validation. Without a doubt, people do this every day. They allow emotions, feelings and reactivity to cloud the deduction reasoning aspects of problem-solving. Even though, we’re affected by our emotional influences, an astute investigator learns to balance between the two. Nothing is foolproof except the fool who proves you wrong.

All too often, based on a superficial assessment of a crime problem, we falter to the slant of hasty generalizations about people, places and property. In short, we must bear in mind people commit crimes because that’s what they want to do. To the extent possible, we try to steer clear of logical fallacies. While this is not likely in an absolute sense, we strive to test and evaluate our inclinations toward cognitive bias. This of course suggests applying rigorous mental aptitude outside the proverbial box of toxic thinking.

No one is immune from biased pursuits to support investigative actions. But, in the overall process, it’s important to ensure a strong devotion to professional training and ongoing development of experience. During the course of an investigation, we want to look into every nook and cranny and leave no stone unturned. In support of relentless acts of discovery, one considers his or her perception of the facts versus the absence of facts. Three points are relevant. One is how do you know a certain crime has occurred? Another is how do you prove it based on what is known?

And, for a third possibility, is your theory of the crime valid? So, in short, how do you know and what do you mean serve to substantiate the necessity for evidentiary criteria. For the investigator, researcher or other practitioner, certain attributes are worth emphasizing. These include: self-discipline in thinking processes, lawful means to reveal the facts, bias control, efficient documentation, proficient capabilities and thorough utilization of forensic applications. Networking with others remains essential.

By use of various techniques and tactics, the more skillful investigator is creative, adaptive and inventive. That’s because productive investigations do not fit a simplistic template of trouble-free functionality, or “profiling” like on TV. One must focus and direct the scope and extent to which the investigative process develops. You consider how to determine the nature of the criminality under inquiry, like statutory authority of the investigation, appropriate jurisdiction, and lawful provisions.

As such, you also consider the issues as applied to the specific incidence, such as identity theft, email threat, electronic commerce, fraudulent activity, offenses against electronic properties, and sexual harassment or cyber stalking. Critical concepts to preliminarily assembling an investigative process necessitate an assessment of expertise needed to address digital evidence criticality and “crime scene” procedures.

When dealing with digital evidence, proper levels of Cybercrime capabilities must be used, along with unique needs regarding seizure, analysis, storage, retrieval and transfer of evidentiary artifacts. Additionally, the investigator has to appreciate there must be thorough documentation, preservation and otherwise protect investigative processes for lawful review by competent authorities. Overall, we must satisfy the fundamentals, as suggested by the basics of who, what, where, when, why and how.

Within the framework of the inquiry, efforts are directed to ensure proper legality in proven methodology, forensic processes and specialized expertise for all digital evidence collection, analysis and security. Investigative processes strive for the ongoing safeguards of logical deduction. This applies equally to the efforts directed toward locating and identifying, if possible, all suspected criminal participants. But, it doesn’t stop there; as such persistence also includes unmasking any and all collaborators.

Three key points in the overall perspective can be offered as reveal the perpetrators, restore and recover properties and services, and resolve the criminality of the incident. Expedient proactive well-planned efforts in apprehension, collection of evidence and prosecution of offenders helps reduce opportunities for misadventure. In addition, promotion of professional interaction among key investigative resources, such as people, places and properties, further enhance preventive countermeasures.

As to the latter issue, an investigator, whether corporate or public agency, ought to realize that criminality is selfishly motivated, highly personal, ego-centric and willfully premeditated. Criminals know exactly what they are doing. Criminal nature comes in all sizes, shapes and socio-economic backgrounds and pay grades. Criminal behavior, even in cyberspace, is a rational choice and for the sake of self-gratification for personal gain. Aside from many sociological theories of a deterministic nature, you are dealing with people who want to commit criminal activity for their particular proclivities.

With a self-centered focus and disdain of others, if given the opportunity in the work place, computer users can easily decide to become computer abusers. By doing so, they become a problem for the business, the organization or the government. From their lifestyle patterns, in the choices they have made, people who choose to commit crimes against their employers, the government, other people’s employers or any entity in particular. They are acting out their brand of salaciously devious behavior.

Their individual perspective is one of risk taking in order to achieve immediate satiation for the anticipated gain. This action comes at the expense of others. Unlike those who choose not to commit e-crimes, the computer criminal does so without wanting to perform the legitimate commitment to do the work necessary to acquire the same objective by lawful means. For the e-criminal, “business” activity means getting away with something, faking a “cause”, or conjuring all kinds of excuses. In contrast to those around him or her, working lawfully for commensurate compensation is not as exciting as taking it without having to wait for it. No matter the pretext, they’re still criminals.

As mentioned earlier, criminals will use anyone to ensure their illegitimate successes. They can be anyone, from colleagues to vendors and so on. Criminality knows no boundaries or respects any institution. How often have your heard, “that person didn’t seem the type”. There is no perfect so called “profile” of the typical criminal. In fact, from a security standpoint, you should be concerned with monitoring everyone’s activity. We can’t overlook the essential protection necessary within any setting. Security of computer systems and networks is crucial if not critical and vital. A criminal today can operate secretly in cyberspace, a cowardly thug behind a computer screen.