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I May Get Retrenched, So I'd Better Line My Pockets Now

Insider threats are escalating as a spin-off from Covid-19 job losses.

Since animals snaked and slithered themselves out of the primordial swamp pools, and our ancestors began to rise up off all fours (politicians excluded) the instinct to survive has ensured our existence. At the same time, our emotions became our single most important cracker for surviving - or at least providing some hope of a survival opportunity.

Humans are apparently born with three psychological traits: The fear of loud noises (phonophobia); the fear of falling (basophobia); and an IQ score. I’m not sure I agree with last one, looking at the world currently… but we have one key trait instilled at birth; self-preservation. I do think this trait is often confused with greed.

Herein lies the problem. As unemployment breaks records and thousands more fear losing their jobs, self-preservation kicks in. What is happening is that traditionally honest people are committing crimes like #fraud, #theft and #corruption on a scale never seen before.

Think about it like this... why did Bernie Madoff, the infamous Ponzi scammer, “make” his billions during the 2008 recession? Because people were willing to gamble, and self-preservation took the normally careful and cautious man and drove him to put his life savings into Bernie’s scheme. Covid-19 has done exactly the same; it’s forced people to embrace self-preservation survival behaviour to look for ways to make quick money, or more of it. Essentially, this virus is potentially turning your employees into possible thieves.

False Contribution Syndrome

A #Forensic Investigation completed last week, by our team of Commercial Investigators, uncovered a new type of insider threat that has manifested itself at a large plumbing company. I’ve named it ‘Contribution Syndrome Fraud.’ In this case, two reps we’re falsifying orders and presenting fraudulent reports to management to enhance their reputation and performance indicators, purely motivated by self-preservation and to avoid the dreaded chop. Although no actual losses occurred, the behaviour was fraudulent and dishonest. Both had perfectly clean and unblemished employment records prior to Covid-19.

Massive Increases in Internal Theft and Pilfering From a different perspective, we have also recorded significant increases in internal theft cases committed by employees and, worryingly, aided by security officers. Our #Undercover Agents deployed at various clients have reported these thefts being committed as a result of job uncertainties amongst staff. Security officers are not immune and several officers have been arrested by our teams after our Undercover Agents reported how these officers were working in collusion with forklift drivers and loading bay staff to smuggle goods out.

So, yes, Covid has decimated many a business and has drawn and quartered thousands of lives, but the instinct of self-preservation is fast doing its bit to turn nice people into serious business crime syndicates. Sadly, many are finding justification in their actions based on the real prospects of retrenchments or salary cuts.

What Do You Do to Prevent These Thefts and Frauds?

Well one thing we know for sure is being “the seventh son of the seventh son” (the medieval pre-requisite to being a clairvoyant) won’t help the vast majority of us. Meaning you need to engage in techniques and help from companies that:

  • Firstly, understand how to investigate internal crimes
  • Secondly, have the resources and skills to implement plans and structures to mitigate these internal losses from reoccurring

We are currently working with various clients from a huge array of industries to deploy Undercover Agents, identify internal employee syndicates, and close loss avenues. 

Some of Our Techniques Include

  1. Creating a Total Internal Loss Control Programme
     
    Research conducted by the hugely respected organisation, ACFE, found that any company that chooses to ignore investing in suitable fraud and theft practices and controls had significantly higher ratios of fraud and internal losses, and took far longer to detect these crimes.
     
    Therefore, we are strongly advocating that your company makes provisions for Undercover Agents (even just one) to work amongst employees and keep you informed of all nefarious schemes and practices taking place or developing.
     
    The deployment of Undercover Agents has proven to be the single most important loss control strategy available to businesses with an employee compliment that works shifts, over weekends, and is unionised.

  2. Security Audits and Lifestyle Investigations
     
    There is never a wrong time to re-evaluate your security systems and controls. However, there are better times than others. Right now would be the preferred time to allow for your loss control portfolios to be tested and refigured.
     
    The same applies for #lifestyle checks. As an Investigation Consultant, it concerns me that too many clients choose to ignore the effectiveness of individual lifestyle audits. Probably because they feel uncomfortable doing it… but remember that the lifestyle audits we perform are done discreetly. Therefore, unless we pick up on a red flag, the subject of our audit will never know - saving you from any feeling of awkwardness.

  3. Due Diligence on New Vendors and Suppliers
     
    I cannot stress this one enough!!!  
    Covid-19 has given sloppy infected birth to a special kind of criminal. The ones that have contrived their devious plans out of the desperation of a world gripped by a pandemic. These bastards have realised that companies are distracted and operating under pressure, therefore often neglecting to perform the basic Due Diligence Investigation prior to contracting, buying or supplying.
     
    As many of you reading this are my clients, and the rest are following us in one way or another, allow me to literally beg you to do one thing from here on out - let us verify unknown vendors and companies before engaging.
     
    If you don’t, you will hate yourself more than Iago hated Othello! Now that’s some new level of hate. Don’t be a penny-pincher on this one. I love investigating crimes, but I love exposing frauds and fraudulent companies and people even more. Let us deal with your Vendor Due Diligence!

  4. Talk
     
    Yes that’s exactly what I am saying... talk! Talk to me, talk to your employees, talk about criminal activities. Make sure you’re getting good advice and sharing that advice amongst your tribe.
     
    As always it’s been a pleasure writing for you, and once again feel free to call me anytime for anything. For those if you that follow EPL at least your fix is about to return... stay safe and now stay warm.

Kyle Condon
082 820 5363
saint@intrigue.co.za

 

For more information, contact Kyle Condon on saint@intrigue.co.za, follow him on Twitter @investigatorsZA or visit www.investigators.co.za.

About D & K Management Consultants CC

Established in 1993 by Declan and Kyle Condon – the legacy of the Condon family with their many years of investigative expertise still strongly governs the running of the company today.

Phone: 082 820 5363

Email: saint@intrigue.co.za