A story on Examiner.com should serve as a wakeup call to businesses and show that any company can potentially lose thousands – possibly millions – of dollars through employee theft, fraud, and embezzlement.

According to the article, the former Vice President of Finance at stereo headphone maker Koss Corporation was arrested by the FBI for allegedly embezzling $4.5 million from the company over the course of a few months, and a preliminary audit has determined that the embezzlement could exceed $20 million since 2006.

The alleged embezzler, who had worked at Koss since 1992 before being fired, claimed she was a compulsive shopper or “shopaholic” – a condition known clinically as “oniomania” – and the article cites several examples of shopaholics resorting to embezzlement to feed their addiction:

• An information technology manager embezzled $3.7 million from Starbucks in the late 1990's to purchase several hundred Barbie Dolls and a collection of expensive cars.
• A Chicago management consultant embezzled nearly a quarter million dollars from her employer to use in shopping sprees for clothing and jewelry.
• A corporate chief financial officer embezzled almost $3 million from her employer, Lube USA, to purchase clothing, shoes, and jewelry.

Besides businesses, religious organizations, non-profits, and schools can also fall prey to embezzlement, Examiner.com reports, and all are advised to use security controls to help prevent embezzlement in the workplace. One way to lessen the risk of embezzlement is through an effective pre-employment screening program that includes criminal background checks. While not every embezzler has a prior criminal record, background checks can reveal much information about prospective employees to potential employers.

The Koss embezzlement case should make businesses aware that employee theft and fraud can happen to any organization. Pre-Employ.com – a nationally recognized background check provider – helps businesses ensure a more secure and ethical workplace that can limit the financial risk of – and public embarrassment from – embezzlement. For more information on how background checks can help curb employee theft, fraud, and embezzlement, please visit www.pre-employ.com, email info@pre-employ.com, or call 800-300-1821.

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