Embezzlement In Mame Research Paper

Jordan Emery
Professor Vollmers
BUA 302
19 March 2015
Exposure to Embezzlement in Maine: A Comprehensive Look
There are two popular theories regarding the motives the embezzler, according to Nettler (1974, 73). The first is that the act of larceny committed by the embezzler “represents the greater allure of the sweet life over the limitations of conventional routine.” Simply put, the said embezzler is dissatisfied with the monotony of daily life and feels that he or she has a sense of entitlement to the money. The second theory is that the embezzler is combating two forces: “desire and opportunity.” Whether the motive of the embezzler is one of yearning, opportunity, or perhaps desperation, one universal truth emerges: the individual committing
However, actual occurrence of such cases is perhaps more frequent in small and family-owned businesses. Heightened awareness of governmental and nonprofit embezzlement stems from newspaper headlines that are littered with stories about town managers, executive directors of organizations, and town secretaries abusing their access to monetary resources. These embezzlers often whittle amounts ranging from $48,000 to $500,000 slowly from accounts via self-issued checks, failure to record cash transactions, padding travel expenses, and doctoring financial statements (Skelton, 2012). Such reports are much more infrequent and uncommon among local businesses, though they do exist. Brown proposes that the lack of reporting of embezzlement from small businesses is due to the lack of financial resources. That is companies fail to report “the ‘small’ losses—typically a few thousand dollars. These are the ones where the initial investigation will cost more in lost staff time and professional fees than the total theft” (Brown, 2012). In such cases, organizations opt to instead dismiss the employee and reevaluate their current internal control system. It is important for them to recognize, however, that just because instances of pilfering and substantial theft from small business employees are not more prevalent in the news, it does not mean that such acts are not
Common red flags for organizations of all types include: an unbalanced bank statement, the bank flagging unusual transactions, reporting of expenses larger than anticipated, issuance of paychecks to ambiguous recipients, late payment to a vendor or supplier, and inconsistencies in financial statement closing rituals (Knapschaefer, 2011). Other incidents may be more transparent to an employer, such as an unexplained charge for a personal item on a credit card, a depletion of products or business supplies from the organization’s shelves, a drastic change in lifestyle habits, or surveillance video recording acts of theft taking place. If an employer encounters any of these signs, actions to further scrutinize the financial records should be