November 1, 2009

Recession ethics: Has the definition of honesty changed?

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Corporate theft is nothing new. According to the Association of Certified Fraud Examiners (ACFE), U.S. employers lose 7 percent of their annual revenue to employee theft -- from inflated expense reports and abuse of corporate credit cards to out-and-out embezzling.

Occupational fraud has certainly made headlines a lot this past year, from the Bernie Madoff crew to the guy accused of pocketing four-plus years of paychecks (totaling almost half a million dollars) from a company he never worked for.

In fact, a recent ACFE survey of fraud experts found that the recession has led to an increase in corporate fraud. This shouldn't come as any surprise, given the financial pressures so many Americans face right now, not to mention the anger so many feel toward their cost-cutting employers.

Thing is, if ever there was a time to be on your most ethical behavior, it's now. Companies worried about their bottom line are notorious for paying extra attention to where their dollars go. And auditing experts maintain that during a recession, many employers beef up their internal, external, or automated auditing systems to pinpoint -- and weed out -- unnecessary spending.

If you think you can pull one over on your employer, you're wrong. For starters, organizations like the ACFE do their darnedest to educate companies about corporate fraud. The ACFE has even anointed next week International Fraud Awareness Week.

Besides, auditors and forensic accountants have seen it all: folks in payroll who give themselves an unauthorized salary bump, salespeople with company credit cards who call their spouse to meet them at the gas station so they can fill up both cars, execs who blow their expense account on lingerie for their mistress, you name it. If you haven't yet had your daily dose of schadenfreude, you can read about some of the most hapless corporate scammers caught in recent months on the website Fraudies.com.

Readers, what's your take on the topic? Beyond the usual pen and Post-it pilfering, have you stumbled on any colleagues engaging in ethically questionable financial practices this year? What did you do? Who, if anyone, did you tell?

Michelle Goodman is the author of "My So-Called Freelance Life" and "The Anti 9-to-5 Guide." E-mail Michelle at mgoodman@nwjobs.com

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2 Comments

AJS on November 7, 2009 12:57 AM | Reply

Recession? it's a Depression!
and it's your own fault
if your Hungry?
Out of work?
Eat your Import!!!

Melissa on November 13, 2009 1:43 PM | Reply

For starters, organizations like the ACFE do their darnedest to education companies about corporate fraud.

Shouldn't that be, organizations like ACFE do their darnedest to EDUCATE companies?

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