Fight Internal Fraud

A loss prevention manager in Toronto, Ontario, was reviewing the merchandise refund transaction slips for the previous day when he came across a $289 receipted refund transaction involving a lawnmower. He had spent the previous day in an uncomfortable security booth overlooking the refund desk, while observing the activities of a cashier suspected of stealing money from the cash register. He was puzzled by the receipted refund transaction of the lawnmower, because he was certain that he had not seen any customer approach the refund desk area with a lawnmower.

The investigation that ensued revealed that the service desk manager was processing high dollar receipted customer refunds as no-receipt refund transactions, keeping the receipts, and later using that receipt to process fictitious refunds and pocketing the money. The dishonest service desk manager knew that loss prevention only mailed out refund validation cards on no-receipt refunds and did not pay much attention to receipted refunds. The investigation documented that this employee caused $186,000 loss over a seven-year period.


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