How to Prevent Non Profit Employee Theft
When your client or potential client starts a non profit, they have a lot of financial factors to keep in mind; how will they fund the start-up of their business? How many employees can they afford to hire? What should they look for in a Non Profit Insurance Company? Most importantly, what business risks should they be aware of and how can they prevent risk exposure?
One of the coverages offered with a Charity First insurance package is crime insurance; which includes employee theft coverage. Nobody likes to think that their employees would steal from them, but the unfortunate truth is that it does happen. While these situations may oftentimes be unpredictable, the following are some steps your non profit clients can take that just might reduce their risk of facing a loss due to employee theft.
Non profit leaders should utilize pre-employment background checks wisely. No matter what type of business your client’s non profit is, basic background checks are essential. While the law varies from state to state on whether a private employer can consider an applicant’s criminal history when making hiring decisions, having a clear understanding of the new-hire’s situation is always a good business practice.
Along with background checks comes checking references. According to sources from the U.S. Small Business Administration, employers often skip this step; perhaps just assuming that the applicant’s references will be great. References, however, can provide insight into a candidates career past, and can be helpful in determining if this is truly an applicant the non profit wants to hire.
Understanding the signs of workplace crime and fraud are also important in preventing non profit employee theft. Although the following behaviors are not always due to fraudulent behavior, they are certainly signs that something may be amiss, and should be looked into further.
- Employee doesn’t take vacations (many violations are discovered when the perpetrator is gone)
- Employee is over-protective or exclusive about their workspace
- Employee prefers to be unsupervised by working after hours or taking work home
- Financial records turn up missing
- Unexplained company debt
- Unexplained change in employee behavior
It’s important to reiterate that these signs do not serve as definitive proof that employee theft is occurring, however they are certainly red flags your non profit clients should watch out for. At Charity First, we understand the unique risks your clients in the non profit sector face, and we offer comprehensive insurance policies for non profits, as well as religious institutions and for profit-commercial businesses. For more information about our products and services, please contact us today at (800) 352-2761.