Business Security & Risk Management

Good Friend & Father or Violent Active Shooter? Why do we miss the cues for Workplace Violence?

2011-10-07T15:59:00.000-07:00

What do people really know orunderstand about a person that can be so far removed from what that same personwill do under other circumstances? What is it about some people thatcauses them to become unusually violent? And what can we learn from thisexample about the warning signs of violence?

Theshooter in this case, 47 yr old Shareef Allman, was a truck driver and 15 year employee at a limestone quarry in Cupertino, CA. He is described as a disgruntled employee who showed upfor an early morning safety meeting with a Glock handgun & AK-47 assaultrifle; he subsequently killed 3 co-workers (all middle aged Hispanic men) &wounded 6 others then car-jacked & shot a female driver before escaping onfoot.

Allman avoided an intense police manhunt for almost 24 hours by hiding in a nearby residentialneighborhood & concealing his weapons. A neighbor alerted police the next morning after spotting him crouched hidingbetween two cars; when police approached he was armed; he challenged them &they shot him in a hail of gunfire.

What went wrong andhow were the warning signs missed?

Atfirst the media stories emerge of an African American man who felt singled outbecause of his race andunhappy about recently being suspended from work. He is reportedly a goodfriend & father, and he had written a novel on domestic violence calledAmazing Grace, & was the host of a show called “Real 2 Real” onCreaTV. At first we all wonder what could have happened in thisman’s life. One man stated: "It hurts to see a good personlike this go through something like this. Somebody must have pissed him off atwork." Another man said: "He doesn't mess with anybody. Heloves God, and he was always helping kids stay out of gangs."

Thenwe find out that Allman has a long history of issues: his ex-wifeobtained a restraining order against him in 1992, accusing him of assaulting heron several occasions. "Myhusband has a violent temper, cannot stand anyone to disagree with him, heinterprets it to be a challenge to him and he reacts with physicalviolence," Valeri Allman said in court documents, in which she stated thathe knocked her unconscious with a brass lamp after throwing other objects ather. He said in court that she was “exaggerating”.

Shareef Allmanwas an avid boxer, weightlifter and martial arts enthusiast; he was physicallymuscular and had an intimidating presence. He also had aminor criminal history, including five convictions for driving on a suspendedor revoked license, authorities said. He served a small amount of jail time fora 1992 misdemeanor conviction for possession of stolen property. Ironically, in his book he appeals to men totake responsibility and to resolve domestic conflicts without resorting toviolence.

This is a very different casethan that of Jared Loughner who appears to be a mentally impaired man,incapable of standing trial for the shooting spree last year in which 6 peoplewere killed & 14 others were wounded, including Representative Kathy Gifford,who suffered a gunshot wound to the head. Yet in both cases important warningsigns were missed or ignored and the issues these individuals were facing wereeither not addressed, or the people involved were in denial of their mentaldeterioration. Last Friday Allman voiced that he was upset & felt thesuspension from work for three weeks, for hitting overhead power lines with histruck, was far too long.

So,how were the many warning signs for impending violence missed? Sadly thecompany probably had no idea of Allman’s history, either because they did notcomplete a background check or if one was conducted, it was not done very welland his prior convictions and domestic violence issues were missed or ignored. More recently the signs were missed or ignored when he became disgruntled abouthis work hours and suspension from work. For a couple of days before the shooting co-workers said he did not make eye contact, which was a safety concern. Perhaps no-one took the warning signsseriously, or his colleagues or supervisor thought he was just “venting” anddid not escalate the potential issues and the issues were not evaluated, and nothreat assessment was conducted. This is what we find most commonly inworkplace violence situations.

Otherpeople observed the subject’s deterioration over a period of weeks or monthsand said nothing. A close friend said that Allman had expressed hisanger at being suspended from work; he felt picked on for his race. He brought his newly purchased AK-47 rifle& showed it to their 20 yr old son who said Allman laughed and said hewould use it at work because people were “messing” with him.

Allmanused a rope & piece of plywood to jam shut the trailer door in which adozen co-workers were meeting, he then opened fire on the trapped workers. According to sheriff’s officials, an hourlater he used a walkie-talkie to call back to the terrified survivors to say hewas coming back to finish them off.

Wemay never know, but one thing is clear: ignoring these warning signs led to adevastating tragedy for 10 people & their families, not to mention theimmediate tactical SWAT response and massive ensuing police manhunt. Ignoringkey warning signs, denial of personality changes by family & friends, &non-escalation of warning signs by co-workers are some of the biggest problemswe face in evaluating potential workplace violence issues before they become someoneelse’s tragedy.

Active Shooters: How can you prepare?

2011-01-24T23:43:00.000-08:00

What can we learn from active shooter incidents such as the one in Tuscon last week where a 22 year old mentally impaired man allegedly shot and killed 6 people and wounded 14 others including Congresswoman Gabrielle Giffords?

Active shooters differ from other types of workplace violence in several respects. According to the Department of Homeland Security 98% of active shooter incidents are by a single attacker: “an individual actively engaged in killing or attempting to kill people in a confined and populated area”. Frequently the telltale warning signs that may exist have either not been recognized or the people at the active shooter location are not aware that the person has a history of problems or threats. Friends and family members of active shooters often are in denial or do not know what actions they can take to prevent violence from occurring.

According to a recent Wall Street Journal article an NYPD study of 202 Active shooter cases reveals that 46% of these incidents are ended by force either by law enforcement or bystanders; while as many as 40% end in an act of suicide.

NYPD recommends that employers train their staff by conducting active shooter drills, preparing one or more safe rooms, and stocking them with medical supplies. They also advise that during an active shooter incident employees need to arm themselves with whatever weapons may be available to them at the time and to attack the shooter "as aggressively & violently as possible"; the more people attacking the shooter, the more likely they will be to stop him. When police arrive on scene, they recommend that people at the scene who are being evacuated should leave with "Hands empty, hands open & hands up" so that they are not mistaken for the shooter or any possible accomplices.

Feuding Coworkers Leads to Violence

2010-09-10T17:17:00.000-07:00

Often people take threats more seriously when they come from a male subject, but this week’s news highlights the dangers posed by women that make threats.

A 43 yr old female employee at Kraft Foods in PA returned to kill two co-workers and injured several others after she was fired for ongoing feuds with her co-workers. The woman, Yvonne Hiller, had been a long-term employee of 15 years who had a history of poor interactions with coworkers. She was suspended from her job for these behavioral problems and was escorted out of the building. She returned a few minutes later, around 8:30pm, threatened an unarmed security guard with her gun and progressed to the third floor break room where her coworkers were shot.

Many questions arise in situations like this: why was this woman escorted from her job but no-one checked to be sure that she drove away from the workplace? How was she allowed to regain entry to her worksite? How do you tell the difference between hostile or bullying coworkers and potentially violent situations? You probably cannot tell these differences unless you conduct a threat risk assessment; this includes looking at the person’s past history, behaviors, background check, brief interviews with coworkers and managers, and evaluating their propensity for violent acts.

We have removed weapons from women that brought them into exit interviews, including small “Saturday Night Specials” a small caliber handgun placed inside a clutch purse; yet in one case the woman had several hundred rounds of ammunition in her desk drawer at work. In another incident the woman stated that she was having problems with her boyfriend and felt she needed to have a weapon with her “at all times”.

If you observe co-workers making threats we strongly recommend alerting your supervisor, manager and human resources professional at your office; it is their duty to bring the matter to the attention of senior management. Using unarmed security guards to prevent workplace violence is a serious security risk today; unarmed guards are only permitted to "Observe and Report" situations; they cannot intervene when an individual is armed. Highly trained armed specialists are needed to be effective in situations like this.

For more information on recognizing the warning signs of violence read here. Read full ABC news article here.

Poisoning schoolgirls

2010-09-10T16:40:00.000-07:00

Just when you think you’ve read about “the lowest of the low” in crimes between humans, this must certainly top the list. Whatever country or belief you are from how can poisoning children be acceptable?

According to the Afghanistan education ministry (as reported by CNN), at least nine schools for girls have had poison attacks in recent months. In the last incident 59 schoolgirls and 14 teachers were poisoned. There have also been 650 reported attacks at schools in one year alone (2008), which have included murder and arson.

This certainly highlights a number of issues: the depravity of terrorists across the globe who use children as weapons to pressure adults to behave the way they want them to, the vulnerability of women in societies that rely on or permit physical brutality as a way of controlling people, not to mention the obvious need for safer, secure schools for children in Afghanistan and other areas of the world torn by terrorist activities and war. Without educating the children how else can things change for the better? The lack of world outcry in situations like this is deafening.

Disgruntled & Highly Dangerous

2010-09-10T16:29:00.000-07:00

Earlier this week we saw another hostage situation end the hostage-taker shot in a dramatic hostage recovery at the Discovery Channel offices in Maryland. What do we know about the waring signs in this case? The gunman, James J. Lee, 43, had previously staged demonstrations outside the company headquarters to protest his environmentalist views and over-population of the planet. Lee hired local homeless people to join him in his protest by throwing cash amongst them, for which he was subsequently arrested and convicted for misdemeanor disorderly conduct. He spent two weeks in jail and was evaluated by doctors for his competency to stand trial, then placed on two years of probation and required to stay 500 feet from the Discovery Channel’s building; that probation ended two weeks ago. Lee expressed repeatedly on his website, his extreme demands that the Discovery Channel find solutions to the problems of over-population and saving the planet’s wildlife (excerpted below):

“Saving the Planet means saving what's left of the non-human Wildlife by decreasing the Human population. That means stopping the human race from breeding any more disgusting human babies! You're the media, you can reach enough people. It's your respo(n)sibility because you reach so many minds!!! …The humans? The planet does not need humans. “

According to various news reports, Lee had four crude explosive devices strapped to him, including two propane cylinders with pipes attached that contained shotgun shells. The other two were pipe bombs. Lee said repeatedly that he was ready to die and did not care about the lives of the hostages, according to police.

This underscores how increasingly we are being de-sensitized to violence, often resulting in people ignoring the warning signs of impending violence. More frequent issues of workplace violence are occurring globally, not just within the USA.

What would you do if your company was suddenly “under attack” by a gunman toting semi-automatic weapons and or bombs? These situations develop suddenly and often when we are least prepared to deal with them except on an emergency or crisis basis. Preparing and training employees on what to do and how to cope in these situations. For more information on tips to prevent workplace violence read here.

Sleeping Tigers

2010-09-10T15:42:00.000-07:00

It seems nothing amazes us anymore. According to articles on Yahoo! and CNN, last week a Thai woman was arrested at Beijing's airport after she hid a drugged baby tiger in her suitcase next to a stuffed toy tiger. Thai officials subsequently placed the 3-month-old cub at a wildlife refuge. Wow! You simply could not make up a story like this! It is almost too funny yet amazingly sick that a person would take a dangerous wild animal on board a long (or short) flight…poor tiger cub! I guess the toy tigers were there to conceal the real one—how can people not understand what an Xray machine does in today’s world? Yet there are uneducated people everywhere who are either ignorant, gullible, or coerced into taking such risks…the sad part is that the rest of us have to put up with the risks that they pose. Kudos to the Xray technician that noticed the tiger’s skeleton in the suitcase! Ah yes and then there is the mistake over the intercom announcing that a (different) plane was about to crash into the ocean—uh yeah that’s a big mistake! What is going on with all this weird stuff lately?

Some brief tips on travel safety:

Report any suspicious packages
Pay attention to the people around you—are they behaving unusually?
Observe and report all suspicious signs or behaviors
Do not let someone else have access to your suitcases or pack things for you.
Do not accept items from someone that you do not know personally.

Oh yes…and watch out for those dazed tiger cubs wandering around!

Family Quarrel Turns Into Threats

2010-09-10T15:29:00.000-07:00

While this summer we have experienced higher than normal activity with workplace violence cases, we have also been asked to advise clients regarding dangerous family matters. Family quarrels can often lead to criminal behavior and threats can become life-threatening situations so easily, as occurred for one of our clients recently.

One of them involved a Hollywood style wedding party. The case began when the father of the bride started sending threatening voicemail messages to the groom. Infortal’s background investigation revealed concerns about the father's history of anger, blaming others for his situation, overt interest in weapons, unpredictable personality, emotional troubles, combined with hostile and threatening intentions. Threat assessment indicated that the father was considered to be a moderate level threat. The couple decided to have armed security presence at the wedding ceremony and reception at a beautiful Hollywood location. Infortal placed armed guards to protect the wedding party and their guests. Read more about potentially violent behavioral "red flags" here.

Smartphone Security: Who is listening?

2010-05-15T16:38:00.000-07:00

How secure are your conversations and cell phone data? What you do and say on your cell phone today may be compromised in one of several ways. Smartphone sales such as the iPhone, Blackberry, Palm and the new Droid are growing rapidly worldwide; industry analysts say 139 million smart phones were sold last year alone. These phones are so convenient; with relatively good internet access it has become very easy to surf the web, access your personal online bank accounts, go shopping online and do many transactions directly from your cell phone. But what risks are involved?

Security specialists say that widespread hacking attacks are harder to accomplish on smartphones because they use different OS operating systems. However identity thieves are more likely to be interested for several reasons: people often lose their smart phones and think little of the consequences, especially if their data is backed up somewhere else.

The problem is when a thief has access to your accounts, then having a backup does not stop the thief's mal intentions. Thieves will have access to any of your personal information stored on your phone (address books, contacts, passwords to other accounts, etc). Additionally, along with ease of use come the same types of threats we see on computers and laptops and other mobile devices: spam, hackers, worms, Trojans and viruses. Trojan horses, viruses and worms can spread easily on smart phones through email attachments.

Worse yet, for many in sensitive personal or business situations, is the ability of unwanted listeners to your personal and confidential meetings. Software and malware are cheap to buy and easy to install. If someone wants to "bug" your phone all they need is physical access to your phone for a few minutes to download and install off the shelf spyware. Then they can listen in to your confidential and private cell phone conversations from a remote listening post. Your sensitive conversation is no longer confidential! Think of your company's key transactions, confidential shareholder meetings, or any other private conversation. Cellular forensics will reveal the presence of such malware but the damage may already be done. If you have highly confidential business meetings it is prudent to purchase specially designed cases that prevent the transmission of conversations without impacting your smart phone in any way.

Security Tips for Smart Phones:
1.Activate the password security feature that comes free with your smart phone and set the password to lock on a frequent basis (every minute or so of inactivity).
2.Do not leave your smart phone unattended anywhere. It only takes a few minutes to download listening software and malware.
3.Do not store passwords and bank account codes on your phone.
4.Download your cell phone provider's security updates as soon as they come out.
5.Carefully consider the source before downloading any attachments.

Identity Thieves Love Tax Season

2010-02-08T16:36:00.000-08:00

During Tax Season how can you protect yourself from Identity Theft? We are all busy getting ready for tax season , and so are many identity thieves. Many of us will receive W-2 forms and1099's in the mail. Some of these forms include your social security number and various items summarizing our personal details: wages earned, name and address. Be careful: identity theft is significantly on the rise across America. So, what steps can you take to protect your identity during tax season? A recent Forbes article provides good basic advice on preparing for tax season: http://blogs.forbes.com/moneybuilder/2010/01/13/how-to-protect-yourself-from-identity-theft-during-tax-season. I would add a few extra points to make it harder for mail fraud & Identity theft:

1. If you have an external mailbox place a high quality lock on it; preferably a lock that cannot easily be picked, jammed loose, or the keys copied.
2. Better yet, bring your mail box inside. (if you have a garage consider a mail slot that drops mail into a box that thieves cannot easily access)
3. Watch for signs of mail tampering
4. Report signs of mail tampering immediately to your post office; you can also file a report
5. If a letter is delivered but the address does not show through a "window" on the envelope then it may have been tampered with
6. Report people that may be rifling through letter boxes. It may be an adult with a child riding in a go-cart--which looks innocent enough, but no-one should be looking through someone else's mail.
7. If you see suspicious activity: report it to either the US Mail Service (Postal Inspection Service) or contact your local police department.
8. Burglars and identity thieves look for signs that you are not home--do not leave newspapers and advertisements to pile up at your front door when you are away.
If you suspect you are a victim of Identity Theft, immediately report this to one of the Big Three credit repositories at::www.experian.com; www.transunion.com, or www.equifax.com. There are also excellent resources for reporting identity theft on the Federal Trade Commission's website at www.ftc.gov. Under federal regulations, you are entitled to one free copy of your credit history from each of these companies each year; make sure you check your credit history at least every 6 months. You can also self-report a fraud alert notice on your own credit history which lasts for 90 days; this means that suspicious activity on your credit cards will be monitored and suspicious activity will be checked; someone trying to establish new credit will find it much harder to do.

MURDER ON FRIDAY: Warning Signs for Workplace Violence

2009-11-06T16:24:00.000-08:00

A former employee returned to his place of employment in Orlando FL today & shot several people, killing one employee. The subject, Jason Rodriguez, age 40, reportedly worked in transportation engineering for Reynolds Smith & Hills for only one year when he was let go for performance issues. His employment ended there two years ago. Rodriguez returned to their offices today with handguns and shot 6 people, 1 person died according to a company spokesman. The suspect was arrested by police, surrendering at his mother’s home this afternoon; and when asked by journalists as he was escorted by police, Rodriguez said “they left me to rot”.

According to WESH.com, a friend of Rodriguez, Ricky Falco, said "the humiliation of being unable to find work in the engineering field and having to move back in with his mother was eating away at him." Still, Falco said “he was not the type of person to hurt anyone, never talked about guns and did not seem suicidal." "He was very outgoing. He was a nice person," Falco said.

Following workplace homicides there are often friends or neighbors that come forward saying similar things; the person was friendly and outgoing, or there were no warning signs of imminent danger.

We are all left wondering: were there no warning signs?

Yes, there were a number of warning signs: local news agencies have reported that public records indicate that Rodriguez filed for Chapter 7 bankruptcy in May and that the case was discharged in September. Other public records indicate that Rodriguez was divorced in 2003. He was also unable to obtain custody of a child, and was ordered to pay child support in 2006. This man was both financially pressured and under pressure from divorce and child custody issues; these are important factors in risk assessment, along with access to weapons, and propensity to commit an act of violence. Of course these are only some of the factors in predicting the possibility of violence, and do not indicate that the person will definitely become violent or when that may occur. Additional facts would be needed for a thorough risk assessment. It will be interesting in the coming days, to see whether he was making threats that were perhaps ignored, and that would have certainly placed him as a high threat risk. Often these threats are misunderstood by the people closest to the individual/ perpetrator, and are often overlooked. Friends often think the person is just “venting”, or they are not taken seriously for other reasons. Sadly for the victims that were injured and those that were killed, as these warning signs may have saved their lives.

10 Tips to Prepare for Workplace Violence & Layoffs

2009-10-15T20:08:00.000-07:00

In today's difficult global economy, many companies continue to face the prospect of layoffs or Reductions In Force (RIF’s). We frequently receive requests for information on how companies can better prepare for RIF's, how to recognize the Warning Signs for Violence, & ways to minimize Workplace Violence.
In November 2008, an employee that was laid off returned to work one Friday for a meeting with the CEO, VP Engineering and head of HR... and in a closed conference room he killed all three. SiPort was a small, start-up company of only 39 employees; it was a very tragic situation. The shooter did not fit the typical workplace violence profile, he was married with three children.
This highlights the fact that although there are profiles that help predict troubled employees who may commit acts of workplace violence, a normally non-violent person may become violent when conditions change. The company needed to cut costs to conserve money anticipating lean economic times ahead. Employees at start-up companies put in very long hours expecting pay-off when the company is sold or IPO's; they may feel "stabbed in the back" when the people they worked so hard with get to keep their jobs & get a chance at the "pot of gold". The shooter was a senior engineer and probably felt he had lost everything overnight. The management team felt that they knew the shooter well enough to agree to meet with him; but it was a fatal mistake, one of many, that should never have occurred.

What can you do to prepare? Prior to conducting a RIF, steps can be taken to minimize the potential for workplace violence:

Recognize the Warning Signs of Violence
Train employees to escalate issues to management
Identify Veiled or Direct Threats & assess risk immediately
Identify behavioral issues & concerns prior to a planned layoff
Alert your company Crisis Management Team
Obtain Restraining Orders (TRO) when a threat is made
Conduct security-based Threat Risk Assessment before the layoff
Plan timing & location of layoffs & exit interviews carefully
Provide armed protection specialists during & post-event if any concerns exist.
Create a severance package to help diffuse threats

10 TIPS TO PREVENT IDENTITY THEFT

2009-10-12T15:44:00.000-07:00

1. Don't give out your Social Security Number unless absolutely necessary (for employment purposes, medical records, new car purchases, bank accounts). Keep your personal information strictly "Need To Know".

2. Protect your date of birth the same way.

3. Cross-cut shred (confetti size shred) all personal documents. Note: Documents that are strip cut shred can be reassembled.

4. Do not throw out personal identifiers in your trash can

5. When buying a new car ask them to cross cut or confetti shred all discarded documents.

6. Check your credit history twice each year.

7. Opt out of companies that sell your information to any third party.

8. Do not carry your PIN access numbers with you & cover your hand when entering these numbers to prevent "shoulder-surfing".

9. Telephone solicitors should be asked to mail their requests to you; do not give out your credit card number to someone you do not know.

10. Always background check your housekeeper, children's nanny, personal assistants, caregivers, or anyone with access to your personal information at home.

Immediately file a police report and notify all three credit repositories by filing a fraud alert, if you think your identity has been stolen: www.ftc.gov/idtheft

WORKPLACE VIOLENCE: 25 Red Flags

2009-09-07T18:56:00.000-07:00

The following is a list of 25 red flag issues that may indicate increased potential for violence, however, this is not intended to be a comprehensive list. This information must be evaluated in combination with various other factors known about the person, including criminal history, various public records, personal behaviors, bizarre statements, and threats made (if any). Threat risk assessments should be made by security specialists, law enforcement agency, or psychologists with specific experience in assessing workplace violence. These items in various combinations are often red flags regarding characteristic behaviors of potentially violent and threatening employees:

25 Red Flags:

History of violence (including domestic violence)
Bullying & intimidating behavior
Emotionally unstable
Exhibit paranoia about what co-workers may think of them
Have mentioned they have stopped taking medications for personality disorders
Expressed interest in weapons (Note; all weapons should be taken seriously including high velocity archery sets, guns, knives, glass, etc.)
High degree of interest in military, law enforcement & other groups (may include hate groups & survivalist groups)
Verbalized approval of prior violent or aggressive incidents by others
Frequently blaming others for their issues
Deteriorating work habits
Increasing or escalating performance issues
Escalating distraction & nervousness
Poor personal hygiene
Financially pressured and/ or high personal stress: recent death, in a messy divorce or child-custody battle, home foreclosure, etc.
Prior issues with law enforcement (including minor issues)
“Loner” behavior (socially self-isolating)
Force their beliefs on others; spreading rumors/ gossip to elevate their own position
Argumentative, unreasonable & disparaging behavior
Constantly protesting about their boss/ the company/ filing multiple claims of unfair treatment
Makes verbal or written threats: Direct threats: “I’m going to kill you at work in front of your friends”.

Veiled threats: “I’ll get him someday”, “I know where you take your kids to school”, “I know where you jog every morning”

Addiction behaviors: alcohol, drugs (street or prescribed), obsessive romance
Harassing others regularly or frequently
Lack basic people skills
Say they feel hopeless often
Wants to bring a briefcase or purse into exit interview & will not voluntarily part with the item.

Is Crime Increasing in America?

2009-08-28T00:20:00.000-07:00

Is crime increasing in America? Latest trends in surveys of C-level executives and security directors at major corporations show a marked increase in crime in the first half of this year.
According to the American Society of Industrial Security’s latest trends analysis, criminal activities have already increased by a dramatic 38% in 2009. This includes every type of crime from theft & embezzlement to workplace violence and corporate espionage. So what are companies doing about these problems? Those companies with established security departments have the capability to investigate internal issues, but what about small to medium size companies that do not have these resources?

Workplace violence, family suicides, and homicides are also increasing as more & more people have difficulty coping with their financial losses and their inability to deal with current economic realities. These examples are in the news daily and include wealthy people, even billionaires have been affected, as well as managers and working class people.

The recent exposure of several high profile Ponzi schemes by individuals like Bernard Madoff (a staggering $65 billion fraud), Robert Allen Stanford ($9 billion) and the lesser-known Nicholas Cosmo ($370 million), Arthur Nadel ($300 million), and Joseph Forte ($50 million) have shocked the business world in recent months; leading to substantial overhaul of the way the SEC operates and enforces securities regulations. Several of these Ponzi scheme frauds have been linked to multiple suicides across the world as private individuals have lost their entire life’s fortunes. Could any of these massive frauds have been prevented? Why werent these criminals discovered earlier? Who was asleep at the wheel? It is certainly noteworthy to mention that Nicholas Cosmo had served 21 months in prison after pleading guilty to misappropriating funds as a stockbroker. Could these crimes have been recognized sooner or prevented? Are crimes taking place inside your own organization, undetected?

Many companies in todays economy are under-staffed and the remaining staff that survived layoffs often do not want to rock the boat and possibly risk their own jobs. We often see this during recessionary periods, and then as the economy recovers, more staff are hired, and suddenly companies become aware of internal crimes that have been covered up or simply not reported. Prevention is often the key first step.

A high quality pre-employment screening program is a great tool for preventing workplace crime. Although many companies today think they have a pre-employment program that protects them, unfortunately many conduct ineffective employment checks, do not use the correct key identifiers and therefore miss 50% of the information they need to make informed hiring decisions. Many companies do not screen their executives at all; resulting in serious compromise of the organization at key managers levels a staggering 20% of executives would not pass an effective due diligence background checks. Issues ranging from no degree earned to bribery, corruption, money laundering, racketeering, kickbacks, and major conflict of interest, even running competing companies abound at the executive level. Regular internal and external financial audits are another important tool for protecting against fraud and embezzlement. Effective network security protocols, processes and proactive enforcement of company policies will also help to reduce criminal activity within your organization, and minimize data leakage of trade secrets and other vital information. These are some of the most effective tools to prevent business crime; and are far more cost effective than focusing greater resources and expenditure on investigating the crime(s), remedying the situation, and damage control; often long after the fact and with several hundred thousand dollars down the drain (if you're lucky).

Security In A Challenging Global Economy

2009-08-26T22:58:00.000-07:00

As the global economy tightens, overall criminal activities have already increased by a dramatic 38% according to the American Society of Industrial Security. This includes every type of crime from IP theft, fraud & embezzlement, to workplace violence, and international espionage.

What can you do to protect your business? The following are a few basic tips for improved security for any size of company from start-up to major corporations:

Screen all new employees’ backgrounds. An ounce of prevention is really worth a pound of cure.

Review the business background of all potential trading partners, including overseas partners.

Re-evaluate your financial accountability & bookkeeping practices.

Institute a multiple reviewer check-signing process to minimize embezzlement activities

Spot check or audit contractor invoices & payroll payment processes

Install theft-protection devices (physical access systems) and asset-tracking devices if you sell products

Conduct Due Diligence on all new executives you consider hiring. You never know what items they have not disclosed to you, and they may dismantle your business from the inside; exposing your customer-base, pricing strategy, marketing strategy and possibly your IP or other sensitive data.

Install data mining software at Point Of Sale terminals to track potential theft problems at cash registers in retail environments & use tiny anti-theft labels to tag & track inventory.

Use professional security services to evaluate threats by employees, prior employees & domestic partners that are making threats.

Re-evaluate all potential threats prior to and during Reductions In Force (RIF’s).

Remove terminated employees’ access badges, keys, change all security codes & passwords immediately & ask them to return all company-sensitive information in exchange for severance packages.

Design severance packages that help to diffuse anger against your company and that help the employee to survive financially, or assist them in getting a new job with outplacement/. Small items can be instrumental in how an exiting employee feels about your company; perhaps you can offer an outplacement service for a short time, or assistance with resume-writing, access to recruiters, extended medical benefit periods, etc. Many companies outsource these services for a nominal cost.

M&A Due Diligence: Know Your Trading Partners™. Before your merge with or acquire another business, conduct thorough investigative Due Diligence and understand what issues may exist that have not been disclosed to you through the legal due diligence process, which relies heavily on voluntary disclosure. Are the Key Management Team sophisticated crooks? Does the company have undisclosed criminal or civil liability issues, or ongoing regulatory complaints that have been glossed over or not disclosed to you?

Business intelligence gathering & competitive information are used widely in businesses today both in the USA and internationally, be aware of data gathering activities to the extent you can be. Discourage your employees from discussing company sensitive issues outside of the workplace; especially in bars & restaurants where competitors and others may be present.

Implement effective policies related to your company’s intellectual property.

IT Security: keep separate functions for network security, auditing, & IT functions to prevent conflict of interests, collusion, and fraud between these groups and prevent data breaches, internal hacking, and other data leakage and network security issues.

For a more in-depth review of all your business practices and exposures, hire a professional security company to review all aspects of your corporation’s liability exposure, and conduct routine quarterly and annual audits of your business financial records.

Executive Background Checks: Honesty & Integrity

2009-08-17T13:49:00.000-07:00

Should executives have their backgrounds checked like all other employees? Companies today often check their executives just as they would screen all other employees; they run the bare basics: criminal history, education and employment verifications. Yet the issues and concerns at the more senior levels in business are broader and the implications for the company, it's shareholders and Board Of Directors are far greater than for other employees. In our experience 20% of executives do not check out. In other words 1 in 5 executives has some type of discrepancy or problem in their background, and that may have far reaching implications with respect to both the financial responsibility of the senior management team, corporate performance and profitability, and also for the fiduciary responsibilities of the Board. Issues at the executive level range from serious criminal history: bribery, corruption, money-laundering, racketeering, and manslaughter convictions, to civil issues such as SEC Violations, Breach of Contract and generally litigious behavior. Another factor that should be carefully reviewed is the executive's involvement in other corporations; have they disclosed every company they serve on as an owner or director? The implications for kickbacks and other issues may or may not be obvious, however, what happens a year later when that company is being sued and your key executive is now bogged down in external legal issues?

Less-serious but often embarrassing for the organization; no degree earned. If the company is a biotech company or science-based service organization and a key employee does not have their degree credentials, the company may lose market share and professional credibility within their industry; they may also have to retract technical papers, cancel clinical studies and refund clients-often at very great expense. The bottom line: It pays to check both the veracity of the information provided by the executive candidate thoroughly and also to check for the items that have not been disclosed voluntarily.