We work in an industry where 'The Guest is Always Right' and 'It Would be My Pleasure' are the driving guest service policies. Comps and upgrades are often given as part of the ultimate goal for exceptional customer service. Unfortunately, this opens the door to extra opportunities for theft and loss in our industry. The Association of Certified Fraud Examiners estimates that the typical organization loses 5% of annual revenues to fraud. Just around 6% of these are discovered by accident. Don't let your organization contribute to that 6%. What are people stealing? Cash, Services, Identities, Products, Payroll hours, Productivity...you name it, anything that can be stolen. Few employees take jobs in order to commit crimes. Contrary to popular belief, it is usually not the disgruntled employee that is going to steal from you. Disgruntled employees usually tell you what is on their mind, both professionally and personally. People commit fraud because they are social animals. Their actions, in great measure, are governed by the culture and environment in which they find themselves. Organizations usually leave themselves at risk for theft as a result of 5 primary conditions: 1)      Lack of controls (Checks and Balances)

2)      The ability to override existing controls

3)      A lack of high-level review

4)      Lack of Communication between departments

5)      A poor ethical tone being set for the operation of the business from owners or management (IE: The culture supports it!) It seems that in most situations we are creating bad employees out of good people. Employee fraud can take place right under your nose and can take as long as 2 years to discover. So, what can we do to prevent employee fraud and theft? The best protection against fraud is to prevent it before it can occur.  Start by changing your culture. Fraud is a shade-loving plant. Here are a couple suggestions to get you started: -          Communicate: Transparency creates an environment that is uncomfortable for fraudsters, making actions that hide illegal activity and information difficult.

-          Explain: Share processes, procedures and the reasons behind them. Hidden procedures can create cloaks for fraudsters.

-          Attentiveness: Talk to all levels of management and listen for any discrepancies in procedure. You can also create simple controls that can help make things more difficult for fraudsters.

-          Monitors and Cameras: Cameras, monitors, and tracking software can be used as evidence and help improve employee training to clean up procedures.

-          Randomly mix up shifts or changes in time off: Employees that are constantly in the same area at the same time can easily plan for fraud. Random changes in shifts or time off may expose revenue shortage patterns.

-          Walk the property and work in the trenches: Make a presence and open conversations. Let everyone see that management is paying attention to the process. A set of fresh eyes on the processes and procedures might expose holes.

-          Audits: Perform regular audits that can help spot theft before it spirals out of control. These audits show that you not only have controls, but you are watching that they are followed. Random audits to check different controls may catch items that even the audit was not designed to catch.

Fraud and theft at your property can adversely affect your revenues, but it can also have a residual effect on your employees' moral. When employees see theft that is not controlled they lose faith in the culture of their property. If you are lucky, changes in procedures and controls can help catch a thieving mind before it becomes the thief. Marie Bell 2018 HUG Vice Chair