Trust is an essential component of any business relationship, but it can also be a dangerous one. While companies should make sure they feel comfortable giving their staff members certain responsibilities, they must also be careful not to allow their good faith to cloud their judgment.
According to the Richmond Times-Dispatch, the leaders of Virginia-based Adams Marketing Associates Inc. have accused their long-time accounting manager, Barbara Mayhew, of embezzling from the firm. The source noted that Mayhew has been charged in the theft of “hundreds of thousands of dollars,” which CEO Ken Adams, who runs the business with his wife, said provider. “We’ve had to increase the employee share of health insurance, stopped giving raises, laid people off and my wife and I are working without a salary.”
Adams emphasized that the breach of trust was angering and disappointing, as Mayhew had been treated like a family member.
The American Bar Association explained that trust is often a critical factor in cases of employee fraud. One way this can happen is when leaders have so much faith in certain employees that they allow them to circumvent critical financial management procedures, like getting two signatures on checks. For this reason, it is crucial that companies frequently use audit solutions to gain objective insight into their financial health.