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What should you do if you know a coworker is embezzling funds?

On Behalf of | Jun 12, 2024 | Criminal Defense

Discovering that a coworker is embezzling funds can put anyone in a difficult position. Knowing what to do in such a situation is important for both personal integrity and the well-being of the company.

Perhaps the most pressing question on your mind is whether or not you will face criminal consequences for not reporting fraud that is occurring in your workplace. You can alleviate these concerns by following the correct steps when you suspect a coworker of embezzlement.

Understanding embezzlement

The U.S. Supreme Court defines embezzlement as “the fraudulent appropriation of property by a person to whom such property has been entrusted, or into whose hands it has lawfully come.” If you suspect that such behavior is taking place at your office, make preparations to report it accurately and responsibly.

Gathering evidence

It is important to not jump to conclusions based on rumors or suspicions. Ensure there are concrete facts that support your belief. Document any suspicious activities, such as unauthorized transactions or discrepancies in financial records. Keep this information secure and confidential.

Reporting fraudulent behavior

Next, report the suspected embezzlement to a higher authority within the company. This could be a supervisor, manager or the human resources department. Most companies have protocols for reporting fraud, and it is important to follow these procedures. Provide all the evidence collected to support your claims.

Protecting privacy

Maintain confidentiality throughout the process. Do not discuss your suspicions with other coworkers or spread rumors. This could complicate the investigation and possibly lead to false accusations against innocent individuals.

Acknowledging legal obligations

Consider the potential consequences for not reporting embezzlement. When someone fails to report fraudulent activities, they may be failing to uphold certain legal obligations. Authorities may view this as complicity or negligence, resulting in fines or other penalties.

Knowing a coworker is embezzling funds requires taking decisive and ethical action. Understand the serious consequences of not reporting fraud, including financial, legal and ethical ramifications.

Photo of Attorney Phillip A. Geigle