How safe is your payroll? Can you risk losing €40,000 from your business through payroll fraud?
Payroll fraud is on the increase – and those who think their payroll is in safe hands should think again! Can you be sure your payroll is properly controlled?
UK Media reported today on a payroll manager who stole nearly £40,000 from her employers. She has been jailed for four years. Between 2008 and 2010, Sally Etchells, 45, who worked at vehicle bodybuilding company Ken Rosebury in Greater Manchester for 25 years, overpaid herself by more than £25,000. She was accused of siphoning off the money into friends’ accounts, including someone who looked after her seven horses.
Managing director Andrew Rosebury stumbled on the theft when he checked the payroll when Etchells was off work for a day in November 2010. After finding several discrepancies ranging from £25 to £5,000 Rosebury confronted Etchells and when she was unable to explain the missing cash fired her from the company.
Before she left Etchells wiped the payroll system to try and erase any trace of her actions and sent letters to the firm’s suppliers falsely telling them the company was in debt and would not be able to make the payments it owed. She also sent a threatening letter to her former manager. A subsequent investigation found that Etchells had taken a further £14,000 from the company disguised as payments to HMRC and other companies.
Rosebury says Etchells was a family friend and it felt like a personal betrayal because she had worked for the company for so long. “Her behaviour nearly sent the company out of business,” he said. After a trial at Bolton Crown Court, Etchells was found guilty of two counts of fraud.
All too often, payroll is entrusted to a senior and long-serving employee who is trusted by Senior Management. While auditors may check the payroll calculations, they are not responsible for identifying areas of weakness such as that outlined below.
It is the responsibility of the Board of Directors to ensure that the internal control systems are adequate and appropriate to prevent payroll fraud. If you would like further information about how Paycheck Plus can help reduce the likelihood of fraud or if you would like information about having a payroll audit, contact email@example.com today or call us on 041 686 3000. Can you afford not to?