Case studies

Paint store

Problem

A new client consulted with us in our offices. His business was experiencing significant product loss and reduced profit margins. We suggested investigatory interviews of the store staff. He waited one full year, then asked us to begin the investigation.

Solution

In one afternoon of investigatory interviews, all four store clerks admitted to a cumulative total of $250,000 in theft. Customers knew that product sold on Saturdays was “cash only, half price”.

Result

Two employees were convicted of felonies. The company was insured for the vast majority of the loss.

Follow-up

A zero loss policy now runs through the entire organization of 40 stores.

Restaurant

Problem

The owners of an established restaurant noticed a slow decline in profits, to the point of running in the red. All servers and host staff became suspects, without any real solution in sight.

Solution

LPG began a forensic accounting investigation and found that the issue was more complex. The real problem turned out to be a very trusted employee.

Result

An investigatory interview with the bookkeeper revealed that she had embezzled $50,000 from the company. After a signed and videotaped confession there was a conviction. The company became profitable once again.

Wolf Auto Parts, Vancouver, WA

Problem

The company found $3,000 missing from the office safe, which four employees had access to.

Solution

LPG was called in for investigatory interviews of the four office staff.

Result

LPG obtained a signed confession for the theft, which resulted in criminal prosecution and termination of employment.

Sporting goods chain

Problem

The owners were experiencing thousands of dollars in missing inventory each month at a sporting goods store.

Solution

LPG conducted investigatory interviews of all staff members.

Result

Following the interviews, LPG obtained signed and videotaped theft confessions from eight of the 14 people interviewed. The stolen inventory was hunting and fishing gear totaling tens of thousands of dollars.

Follow-up

A Zero-Loss program was created at each store to prevent further loss.

Shell station

Problem

A Shell station owner called about low profit margins. One day of investigatory interviews of the store staff uncovered that one very trusted and well liked employee had embezzled $160,000 over the past four years by failing to ring cash sales. This employee was the most willing to work on days off. He even bought gifts for the store manager.

The tip-off

The store owner and the trusted employee got on an airplane to fly to the store manager’s wedding in Vegas. The owner sat in his seat, looking around for him, and finally called his cell phone. “I’m on board already,” came the reply. Then it dawned on the owner: this trusted $8.50 an hour employee was in first class. Trust, but verify.

Solution

We interviewed the store staff and obtained a written and videotaped confession. The felony theft was prosecuted, and the insurance company paid the full limit of the insurance policy.

Result

The store immediately became profitable and recovered $40,000 of the loss.

Convenience stores

Many of our convenience store clients come to us with the same problems and see the following outcomes.

Problem

Store owners notice missing cash, inventory shrink, low profit margins and tills that are short at the end of the day.

Solution

LPG is called to investigate and interview the store staff.

Result

As a standard, convenience stores can expect 30% to 50% of employees to admit to stealing cash, product or both.