Orlando business lawyers may provide valuable internal control documents to reduce fraud.

Florida – February 28, 2023

According to the 2020 Global Study on Occupational Fraud and Abuse, one in three cases of occupational fraud are caused in part by a lack of internal controls.  Theft, embezzlement, bribery, benefit, and payroll fraud are common types of occupational fraud and are costly to many corporations sometimes leading to business failure.  An Orlando business law attorney can assist companies with drafting protocols for internal controls that would mitigate occupational fraud as strategic methods to combat white-collar crimes.

• Embezzlement takes place when a person intentionally uses funds for a different purpose than they were intended to be used.
• The embezzler has permission to handle an asset in a certain way as part of their job, but not to take it.
• Embezzlers might create bills and receipts for activities that did not occur and then use the money paid for personal expenses.
• Ponzi schemes are an example of embezzlement. Others include destroying employee records or pocketing company cash.
• Businesses lose billions of dollars a year to theft.
• Embezzlers can be held civilly and criminally responsible for their crimes.

When a business owner suspects an employee or partner has misappropriated funds from a company, they may need to speak with a business lawyer to find out what actions to take. An experienced business law attorney will guide clients toward addressing the theft and stabilizing a company that may be subjected to financial ruin due to the negative action of embezzlement.

Legal action against the misappropriation of funds.

Certain elements must be present before legal action can be initiated. The individual who has been suspected of misappropriation of funds, theft, or embezzlement was acting in a position of trust or within their fiduciary duty to the business. The accused party must have acquired funds or assets through the business relationship. The accused party has taken or received misappropriated assets or funds.

Proof of theft.

The action of theft must be proven for successful litigation outcomes. This can be difficult to prove in many cases unless the thieving party confesses.  Often a company’s financial documents may not make It clear that business theft has occurred if the person is in a position of trust, they can make efforts to hide this fact.  Proving financial loss at the hands of a trusted employee or partner may be difficult without collecting financial documents from outside entities such as banks and investment companies.  An experienced lawyer can assist with these activities by collaborating with accountants to go over company books and see how vendors are being paid and identify any discrepancies.  Inventory can also be monitored to investigate drastic shifts in inventory stock. A close review of credits provided to customers should be undertaken as well as this is a common strategy of embezzlers to misappropriate corporate funds by accepting full payment on invoices . It is often beneficial to review all credits provided to customers over the suspected period. One of the most common strategies for embezzling or misappropriating corporate funds is to accept full payment on an invoice, issue a “credit” and pocketing the amount of the credit while altering accompanying documentation. This is another reason to contact an experienced business attorney. It is important to establish many facts in the situation and conduct extensive surveillance and/or forensic accounting. These important steps must be conducted in a thorough manner often without making the suspected target aware of them.

Hire a business law attorney.

Business owners should seek the assistance of an experienced business attorney to reduce corporate theft by drafting standard operating procedures that contain internal controls or when attempting to identify corporate theft or misappropriation of funds.  Attorneys at Legal Counsel, P.A. can build a case against a guilty party to correct corporate theft in Florida.

Legal Counsel, P.A.

189 S. Orange Ave., Ste. 1800
Orlando, Florida  32801

Phone: 407-982-4321

Sources.

1. https://acfepublic.s3-us-west-2.amazonaws.com/2020-Report-to-the-Nations.pdf
2. http://www.leg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&URL=0800-0899/0812/Sections/0812.081.html