Employee Theft Statistics

statistics upEmployee Fraud and Theft Problems on the Rise

Fraud investigators find that small business employee theft is out of control.   Economic problems have only made this longstanding problem worse. Citing recent U.S. Chamber of Commerce figures that employees steal approximately $400 billion from businesses each year and an Ernst & Young survey showing that nearly 90% of organizations countrywide experienced some type of fraud in the 12 months prior to the survey.  The Economic downturn has only made matters worse.  Small business theft is the biggest reason for small business failure.  The U. S. Small Business Association states that 5% of a company’s annual revenue is lost to employee fraud and theft.  Fraud experts interviewed for this report note that all sectors are targets–including retailers, hospitals and healthcare, the hotel industry, schools, and college campuses.

There are literally hundreds of ways your employees could be stealing from your small business. A list of the top few include:

  • cash theft
  • inventory theft
  • theft of time
  • credit card theft
  • workers compensation theft
  • theft from customers
  • theft of supplies

One problem with employee theft statistics is that the prosecution rate for employees that are caught stealing is very low.  Consider that most small businesses are not familiar with the criminal justice system and are unsure how to go about prosecuting an employee caught stealing from their small business.  Small business owners are not sure how to proceed, and are not sure how much time and money it will take to prosecute an employee for theft.   This fact makes the employee theft statistics that are published even lower than they really are.  This leaves the employee who has been caught stealing free to move from employer to employer, padding their pockets along the way.