Avoiding Employee Embezzlement
Many experts say medical practices have the highest embezzlement rate of any service industry. Ask one of your colleagues if they have ever had an employee steal from them or knew of a practice that had. Embezzlement occurs everywhere including medical practices.
Posted in Risk Management on Monday, May 7, 2018
Many experts say medical practices have the highest embezzlement rate of any service industry. Ask one of your colleagues if they have ever had an employee steal from them – or knew of a practice that had. Embezzlement occurs everywhere including medical practices.
When you spend most of your day with someone at the office, it may seem impossible to imagine that they would steal from you. However, seemingly nice people do steal. Unfortunately, medical practices typically fail to prosecute or take action other than to terminate employees who steal. Embezzlers leave a practice with your savings, get terminated (not prosecuted) and go work at another practice where they may repeat the same cycle.
Help avoid embezzlement in your practice by following these protocols:
- Make time to understand the flow of money in your practice – hands-off approach is a recipe for disaster.
- Don’t allow anyone to sign checks on your behalf or at least require two signatures on all checks.
- Schedule time to review office finances each week or month.
- Require bank statements be delivered to you unopened.
- Review all canceled checks.
- Never give one employee full control over your money, cash flow or accounts. That includes office managers.
- Consider using an outside accounting firm to audit your practice. This can be done biannually or as needed.
- Check references and perform background checks on all new hires. This should include a criminal background check and a credit check.
- Do not ignore your instincts, and act accordingly.
Controls should extend to writing checks (who can write checks and under what circumstances) and handling bank statements, incoming checks and payroll.