"John," a roof system installer, was filled with excitement. He had decided to start his own roofing company. He had a loose business plan, a few jobs lined up and best of all, he had persuaded his co-worker "Michelle" to work with him. He would handle completing the jobs, and she would handle managing the office duties. John even offered to pay Michelle's vehicle expenses to compensate for the long commute to his new office. John believed he did not need to train Michelle or oversee her work. After all, she was experienced!
Ten months later, John sat down with me at the Denver District Attorney's office and listened in dismay as I explained he might never see a dime of the more than $40,000 Michelle had embezzled from his new company. By the time John ended up in my office, it was simply too late.
If this happens to you, local law enforcement agencies will not perform an audit for your business; they will not recreate your books; and restitution will be limited if you recover any of your lost funds.
Much of the following information comes directly from the 2016 Association of Certified Fraud Examiners [ACFE] Report to the Nations on Occupational Fraud and Abuse. In the report, ACFE has put statistics and definitions to what I have seen anecdotally in cases I have handled during my time as an economic crimes prosecutor in the Denver District Attorney's office.