Business Builders Blog

Category: Hire the Right Person

employee theft (part 2 of 2)

It was a Wednesday morning, and like many mornings I was starting my day by checking emails.  One from a long-time client caught my eye – the subject line was “memo regarding personal credit card charges.” As I read, I held my breath as the words spilled out on the page. It said, “Our controller made personal purchases with a company credit card.” When asked about it she told the bookkeeper that she had mistakenly used the wrong card, and already paid the charges.  However, upon further research into the payments, it shows she paid these charges with a transfer directly from the business account.”

Oh no, how could this be?  Maybe it’s a mistake I thought.

For the next three days, I dug into their books, hoping, and praying this would all be an innocent mistake. As the next three days passed, the little signs and weird transactions were revealed, and my optimism gave way to serious doubt.

By Friday evening I got the confirmation from the bank that I dreaded – the Controller had been issuing herself additional payroll checks that were deposited directly into her bank account.  After the transfer was made, she’d void the payroll record, and then enter bogus checks into the system under other people’s names so as to not draw attention to the fact that she was embezzling.

For the next two days, I continued to dig, and the total rose to $45K, and eventually to $55K. It turns out it was not only payroll, but also vendor checks made payable in the software to someone else, and then the name changed, and cashed by her.  NOTE: Wells Fargo bank lets you make a deposit on your phone – we’re guessing she just changed the payee on the physical check, deposited the funds, and no one was the wiser.

This controller, new to the job in the last six months, had shown every indication of being completely trustworthy and reliable.  In fact, she had found several errors from the previous Controller and fixed them all. So, what had they missed when they hired this person in the first place?

They’d done a background check, run a credit report, verify previous employment – everything you’re supposed to do when hiring someone who is responsible for the money in your company.

Upon digger deeper, it didn’t take long to see how the systems and processes in that business contributed to this employee’s ability to embezzle.

The following Monday we confronted the employee with a full detail of what we’d found.  She confessed, cried some alligator tears (literally), said there were no other amounts (which was NOT the case), gave a lame excuse of being overwhelmed and pressured, and promised to pay it back (so far, they have seen $1000).

Following that meeting, we went to the police department to file a fraud report.  They provided a case number and said it may take a while for them to process the paperwork, call next week.  That was two months ago.

Today after inquiring for the 3rd time about the report, they told the owner that this case was #133 and that there were 132 cases in front of theirs!!! My heart sank.  Are there really that many people out there stealing from their employers? Unfortunately, the answer is YES – there are.

We want to see the best in people, and not believe that they would do something like this, but they do.  As business owners, we have a fiduciary responsibility to all our stakeholders (partners, employees, customers), and thus need to be diligent in managing the finances of our companies.

Below are some tips that can help you avoid this happening to you.  I also encourage you to read “How to Spot Accounting Fraud.”  EVERY time I’ve seen someone embezzle from a company there were signs.   This is your DO NOT list…

  • Do not let employees be signers on the bank account – especially if they are the ones cutting checks and reconciling the bank account.
  • Have someone other than the person approving/cutting checks reconcile the bank accounts. Make sure to get copies of the front and backs of the check, and review the payee against what shows in your accounting software.
  • Do not let employees make transfers between bank accounts. This should be done by the owner.
  • Do not pay with credit cards online with a transfer, rather cut a check. This is the number one place where people embezzle money in small companies.  There should be a backup for all credit card charges attached to the statement.
  • Don’t sign checks without backup. Make sure to review the backup and that the appropriate person has approved the expense.

When you don’t pay attention to the ways employees are spending your money, they will assume that it is okay with you.  That includes your office and field employees.   Really, it’s weird, but they will think over time that it must be a perk of the job if you let them purchase tools for themselves, or gas for their personal use, or pay their phone bills, or car payments.  I’ve seen it – no joke.

I implore you – don’t abdicate your financial well-being to the really competent and talented accounting person who wants to “unburden you” with the hassle of accounting.  That is a warning sign.

If you missed last week’s blog, check it out “Are your employees stealing from you? How to spot accounting fraud.”  And here’s a resource that will help “How to Spot Accounting Fraud.”

generous GC shares his hard-won secrets to success

​Becoming successful in the construction industry isn’t something that just happens – you have to work SMART at it.

The trick is knowing the right things to focus on…

Because once you know the key drivers that consistently move the needle, your life as a contractor gets easier and much more enjoyable!

I’m confident this will be one of the most eye-opening interviews you’ll ever hear.

Aaron is a very successful and well-respected GC and, in this interview, he generously shares the primary things he focused on, that play the most significant role in the success of his business.

Aaron reveals:

  • The little-known secret to being a successful contractor who makes a solid profit and is well respected (this will surprise you because it’s probably not what you’re thinking)
  • The worst obstacles he had to overcome along the way (This will help you avoid being blindsided by these same landmines and pitfalls)
  • The top 3 most important things he pays attention to on projects that have made a huge difference in project profitability (#2 is priceless)
  • Insights into building a great team (and how to avoid hiring the wrong person)
  • And so much more!

​If you want more control over your contracting business’s success, you need to keep your finger on the pulse by leveraging the most critical drivers contributing to its success.

Watch the video and learn what they are!

And be sure to keep an eye out for the follow-up interview I did with Aaron… I’ll share it with you next week, it’s a MUST-SEE!

In it, he reveals how doing “cost-to-complete-projections” monthly has been instrumental in his ability to control project profitability.

You’ll see us walk through a real project example, so you can see exactly how Aaron does this, and model his process.

onboarding employees – a success story to model

​If you ask any remodeler or custom home builder they will tell you, getting new employees up to speed and productive can be one of the biggest drains on your time…

If you’ve ever wished there was an easier more purposeful way to get new hires indoctrinated into the culture of your contracting company, you are in the right place, because…

You are about to get an insider look behind the scenes at how these business owners hacked the code for successfully onboarding new employees that guarantees they are ready to hit the ground running from day one!

In this interview, Jazmine and Heather reveal:

  • How they discovered the efficient and time-saving approach for onboarding new employees…
  • The 5 key things they always include in their onboarding process that make a HUGE difference in an employee’s ability to “hit the ground running”…
  • A bird’s eye view, from the employee’s perspective, they say makes this one of the best onboarding experiences they’ve ever had in starting a new job…
  • Their worst onboarding experience – and how that experience uncovered the solution for doing things differently…

Watch the video to discover 5 key things you can incorporate into your onboarding process, guaranteed to get new employees up to speed quickly and have them immediately be a good culture fit right out of the gate.

keeping labor cost down while hiring the expertise you need

As the economy shows signs of slowing, are you thinking you need to ramp up your marketing?

Or maybe you’re looking to hire an expert in an area of your business, but don’t really need someone full-time, or just have not been able to find the right person.

Nearly 20 years ago I discovered the perfect way to find the expertise I needed to help take my business to the next level, without having to commit to a full-time employee, and without having to spend gobs of time training someone.

When I hired my first virtual assistant all those years back, it was one of the smartest moves I made! I quickly discovered that I could free up my time to focus on money-generating activities, and at the same time hire experts who knew more about a particular subject area than I did.

Watch this interview I did with Dortha Hise of Pretty Smart Virtual Services, and learn how to find the ideal virtual assistant to help you leverage your time. Also, make sure to check out the FREE checklist Dortha provided that outlines the questions you want to ask a prospective VA to ensure they are the right fit for your needs.

Wondering what you might use a VA for in your business?  Here are some examples of what I use VAs for:

  • Social media posting – allowing me to have a consistent presence online.

  • Writing marketing copy – taking my words and making them more captivating and interesting.

  • Doing SEO on my website – attracting my ideal customers to find me quickly

  • Posting blogs to my website and sending out emails – freeing up precious time.

  • Keeping our website updated and relevant – making it easy for customers to navigate and find content quickly.

  • Maintaining our mailing list so I have a reliable platform for doing consistent outreach.

  • Project management support – handling the technical side of my training platforms.

  • Experts in Excel – helping to develop and maintain the products and tools I offer.

  • Video editing so I can focus on content creation and have someone else deal with the mechanics of “polishing it up”

Your time is important, and when you spend time on things someone else could do, you’re taking away time you could be spending developing and growing your business. Watch the video and then try it out!  You can use this tool from Dortha “Questions for Hiring a Virtual Assistant” to help you make sure you’re hiring the right Virtual Assistant for you!

“Hiring Right” mini-series for Contractors – Part 6 of 6 (Can You Trust that Candidate You’re About to Hire?…)

The employee struggle is real for contractors…

I hate to hear it and unfortunately, I’ve heard it far too many times over my 30-year career working with construction contractors.

An employee suddenly goes rogue and uses their account access to purchase a bunch of materials for a side job.

I’m likely preaching to the choir because I’m sure you’ve heard your fair share of nightmare stories of contracting businesses being embezzled.

Heck, maybe you’ve even experienced it yourself!

Not fun… but if you take a few extra steps before you make that job offer, you can sidestep the horrors of dishonest employees.

That’s what I’m going to share with you in the final video of my 6-part “Hiring Right” mini-series for contractors where I reveal a proven system for verifying a candidate’s background.

This system is used by many top head-hunters and successful contractors to ensure that what a candidate tells you or puts on their resume is true, or if they are lying.

Watch the video right now to discover the actionable steps to help you have the peace of mind that the hire you’re about to make can be trusted.

If you’re interested in the entire suite of tools, including hiring resources, checklists, and interview questions, check out my course – Contractors Hiring Blueprint where you’ll get training videos, checklists, and resources for finding and recruiting, and onboarding great employees!

“Hiring Right” mini-series for Contractors – Part 5 of 6 (Narrowing in on the Right Candidate…)

Have you ever experienced the frustration of second-guessing yourself after spending hours or days interviewing candidates for an important position within your contracting business?

You lie awake in bed at night, losing sleep, wondering if the person you chose is really the best fit for the position…

Or what about when you interview multiple people, with very similar backgrounds and skill levels and just can’t decide which one is the right one to hire?

Those kinds of things can gnaw at your brain for weeks!

Luckily, I’ve discovered a tried-and-true method to help you confidently narrow in on the right candidate, without second-guessing yourself.

That’s what you’ll discover in part 5 of my 6-part “Hiring Right” mini-series for contractors. Take a few minutes right now to watch and then immediately add this powerful process to your hiring toolbox.

If you’re interested in the entire suite of tools, including a phone screening checklist, and interview questions, check out my course – Contractors Hiring Blueprint where you’ll get training videos, checklists, and resources for finding and recruiting, and onboarding great employees!