Employee Fraud

It never ceases to amaze me how we as human beings can be so messed up at times. I mean, we make the most idiotic decisions. It almost seems that if things are going too good, one goes out of there way to ensure that does not last long. It has happened to me. I try to ensure those unwise decisions are the mere pinpricks in life and not the important ones. Selfishness is a basic human trait. There is always that temptation to use the system to your advantage even if you have to tell a little white lie. Unemployment is a great example. People will rationalize to themselves that the money is for them, that they paid into the system for so long they should be able to collect their fair share back, if they collect more than their fair share so be it. What they often do not realize is that unemployment insurance is a major expense to employers and the more claims the more expensive it becomes. False claims against an employer can seriously jeopardize the employer’s ability to operate profitably.

The employee of discontent

We were called to the shop of a small business a few years back. It was a small manufacturing operation. It seems that one of their long term employees pulled a Crazy Ivan on them by declaring that he had been ripped off for years by this company and things were not fair around there anymore. So the employee quit. What wasn’t said is that this employee made over $14 per hour, worked 32 hours per week and was paid for 40 hours. He also received a full benefits package along with use of the facility as a private garage to work on private vehicles at their leisure.

The following factors worried our client. First, this employee claimed he was laid off, filing a claim with the Department of Labor and was trying to collect unemployment in a fraudulent manner. Second, the employee was going around town telling everyone who would listen that our client had dumped tons of hazardous waste on their property site and covered it up with dirt. He was threatening to call in the EPA, the IRS, BNSF Railroad, the ATF, the FBI, the DEQ, the BLM, the County Assessor, and ET (he was too busy). He was going to get even with those unfair employers.

Now here is the deal, there is much power in an allegation these days. Our client was not worried in the slightest about these allegations because they were untrue. However, it certainly would not be a fun time being host to the above organizations to disprove these allegations either. It certainly would tax ones nerves and time resources. Once you get on an agency’s radar, like any Government organization they will make your life miserable while in the same breath proclaiming their nobleness at helping out the little guy.

So our client called us in and wanted to know what we could do. He did provide some very useful information. He suspected the person was working under the table at the present time with a family member. The best course of action would be to put surveillance on our miffed employee and see what his comings and goings would tell us.

Our first morning, we set up at the individual’s home. At 7: 00 am sharp he was out the door and off to his new job. We were able to follow our subject to the backside of Hayden Lake to a home that was being remodeled. It seems our guy was working under the table for $10 an hour while conveniently collecting unemployment. An hour or so of video and we were done for the day. The next day we did it again to build a pattern. We were not disappointed.

It is now time for the endgame. We had a meeting with our client and decided the best way to handle this situation is for everything to go away. Our subject stops claiming unemployment and tones down his slander to the agencies and we will not pursue fraud charges. We had that little meeting with him on the back side of the lake at the worksite. We made sure and had that meeting on audio and video. Everything went fine at the meeting it was cordial and to the point and all sides agreed the matter be dropped. An hour had not gone by when we received a phone call from the Sheriff, it seems that our subject had drove straight to the Sheriff’s office and lodged a formal complaint on our firm. He alleged that we threatened him, and had drawn weapons on him. Well, I guess if one is going to lie, “the bigger the better” as Adolph Hitler would say. The matter was dropped as soon as the County investigator realized we had a complete audio and video of what exactly happened. I cannot help to think of our subject who was so discontented at his $14 per hour job with benefits, who is now working for $10 per hour and for his father in law. What a little self reflection could have prevented.

Phillip Thompson is a Vice President and Sr. Investigator for Confidential Investigations. Mr. Thompson has a business degree from Central Washington University and has been involved in investigative work and fraud detection for 8 years. He joined Confidential Investigations in 2002. He can be contacted at 208-762-5767 or email phil@idahoprivateeye.com.