Theft by employees is not an easy thing for any organization to face, and unfortunately it is on the rise. PGI has now settled a third Real Estate Office Employee Theft Claim. Here are some tips to help prevent this from happening to you:
1. Make sure you have the appropriate insurance coverage in place. Review your Business Owner’s policy. Some companies offer Employee Dishonesty Coverage with the Business Owners Policy. Based on the recent claims, the amount of insurance we recommend is $50,000-$100,000. This can be added for about $300/yr (for $50,000), but the amount varies based on revenues and employee count.
2. Perform criminal background checks on all employees. There are several online vendors, but you may be able to get a better rate using a special investigative firm. We are also working on a group discount. If you are interested, please let me know.
3. Make sure you have comprehensive accounting processes in place and they are adhered to without exception. This includes no signing blank checks, have a separate person review bank statements, and provide invoices for all checks.
4. In most cases the theft comes as a complete surprise because “everyone” had complete trust in the accountant. We’re not saying don’t trust the accountant, but be sure your procedures are in place and strictly followed, which will cut down on the possibility of someone taking advantage of a lax system.
Based on the fact that we insure approximately 30 real estate offices and there have been three thefts, chances are greater than you think.
Please make sure you are adequately protected and take proper precautions and, please, never sign a blank check again.