How Heavy is a Ghost?
Last week a sales executive I know contacted me and asked if might be able to substitute for her at an upcoming networking group meeting.
Networking groups (for those who don’t know about them) are forums for businessmen and businesswomen to get to know each other and exchange ideas and referrals. In one segment of a typical networking group meeting every attendee has the floor for one or two minutes to tell the other group members about the product or service that they provide to their customers and clients.
Anyway, after I told Meaghan that I’d gladly represent her at the meeting she sent me the text of the message that she wanted to pass on to the group. Part of the message was that her employer, Solex Payroll (www.solexpayroll.com), can typically slash a business’ payroll costs by 30%-50%.
Believe it or not, the statement made me jealous – just because it contained a real, honest-to-goodness, verifiable statistic. A statistic that Solex Payroll could back up if asked.
I wish I were that lucky. No one, and I mean NO ONE, has any reliable statistics about workplace fraud.
Not that statisticians haven’t tried. There are, in fact, published statistics about workplace fraud. But all of those statistics are based on reported fraud losses. The “gotcha” is that no one knows the percentage of workplace frauds that aren‘t reported. Worse: investigations that uncover workplace fraud may fail to uncover all the schemes that are being used. And worse still: investigations that do not uncover fraud may miss frauds that are actually there.
So trying to determine the scope of the workplace fraud problem is akin to trying to weigh a ghost. In order to measure something you need to be able to “encapsulate” it. That can’t be done with workplace fraud.
Statistics can send a powerful message, though. So when I address a large group I always have the group generate “local” statistics about workplace fraud. It usually opens a lot of eyes and drops a lot of jaws.
A few months ago, for example, I presented a workplace fraud webinar to B2B CFO, a nationwide organization of part-time CFOs (www.b2bcfo.com). Prior to the webinar I had asked the members about their personal experiences with workplace fraud. I presented the results of this informal survey in the first few webinar slides. Here they are:
- 57% of responders personally knew a business that had been defrauded of over $20,000
- 66% of the known perpetrators were either executives or on the accounting staff
- 61% of the known perpetrators had been with the business for three or more years
- 65% of the responders felt that the losses were either “major” or had seriously impacted the business
As I pointed out the to the attendees, as shocking as the results seem these numbers are typical for groups that I speak to.
So how much does the ghost weigh? Darned if I know. But it’s probably heavier than most business executives believe. And ignoring the ghost can come back and haunt you.
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