The manager would sit down with him every month, going over the books. Everything looked good until the recession hit. The contractor faced hard choices. He laid people off and cut pay. He took out a second mortgage and put personal money into the business, but it wasn’t enough. The financial manager told him the company couldn’t make payroll.
Times were hard, but that didn’t add up. One night, when looking at his online banking statement, the contractor noticed a check to a company he didn’t recognize. Staying up until 2 a.m., he found evidence his financial manager had written company checks to herself totaling $45,000.
When it was all tallied, the manager had taken $1.7 million from him in eight years, forging his signature on more than 280 checks.
The experts we talked to agree: contractors are no more susceptible to embezzlement than other types of businesses. But that’s cold comfort.
“Discovered embezzlements suggest that on any given day one in four businesses are being embezzled,” says Arnold S. Grundvig, Jr., who devoted the first chapter of his book, “The 90-Minute MBA,” on the subject. “A very small number of them make the news.”
