Private Investigator

PRIVATE INVESTIGATOR
for
Your Family Business?

private investigator As a family business owner, have you ever considered calling a private investigator? Probably not, but maybe you should. Almost every family business will at some time be faced with a situation where they need to retain their services. They can play a proactive role in controlling losses and protecting assets.

Wide range of services

Most investigators work for corporate security firms that offer a wide range of services including executive protection, blackmail, kidnapping, false insurance claims, white collar theft, fraud, child custody and protection, missing persons and asset recovery.

Security firms often are used to conduct database searches and background checks that provide useful information about an individual including prior arrests, convictions and civil legal judgments. They are also capable of doing physical and electronic surveillance.

Family-owned businesses are more complex and require high levels of confidentiality. Investigators working for family businesses have to understand family business dynamics. These family business investigation specialists are retained by family businesses to conduct a wide range of services including internal and external investigations, background checks, uncovering drug use in the work place, employee theft of merchandise, equipment (and other types of company assets) through fraudulent accounting practices and key managers/employees who are selling confidential information, otherwise known as industrial espionage.

Introducing Harold Copus...

Harold Copus is our family business security expert.

A former Special Agent with the Federal Bureau of Investigation, Copus frequently appears as an expert commentator for security and terrorism issues on Fox News Network, CNN and Court TV.

Most recently Mr. Copus has been featured in multiple appearances on the Dr. Phil Show for his work in finding and rescuing missing children and adults.

In 2002, President George Bush invited Copus to the White House for a conference on missing and exploited children. Copus was recognized for his work and was asked to attend the White House when President Bush signed legislation to create the Amber Alert Law.

Copus is internationally recognized for his work in complex financial investigations and white collar crime. In supporting corporate litigation, he is recognized as an “expert witness” in fraud investigations for the US District Courts in North Carolina and Florida.

We thought it would be interesting and helpful for you to read about some of the cases Harold and his associates have solved. You may be surprised to learn how everyday people and everyday situations may not be what they seem!

The next time you have reason to believe something is amiss in your family business, you should ASK THE EXPERT and use the services of our private investigator to gain peace of mind.

Copus Cases

RIF Security Strategies

Identity Theft Prevention

Employee Criminal Background Check

Purchasing Agents - Checks and Balances

Religious Cults - Pray or Preying?




TRUE CRIME STORIES

One sure-fire way for family businesses to improve the security of their business is to learn from the mistakes of other family businesses. To that end, we have a page on our site, True Crime Stories, where visitors to our site can post a crime story that involves a family business being victimized by a crime. To post your story, click here True Crime Stories




TIPS FOR AVOIDING FAMILY BUSINESS FRAUD

Here’s a not-so-uncommon scenario: Brother Joe handles all the accounting for the family business. That can be very challenging and stressful at times, especially when cash flow is tight. He secretly feels he has the worst job in the business and doesn’t get compensated enough for all the stress and burden it puts on his home life. Since he oversees all the company finances, who’s to stop him from taking an extra paycheck on occasion, or giving himself a little salary boost? So he does—and it may take months or years for anyone to notice.

That’s just one example of how fraud happens in family businesses. Here are some others:

“Ghost” employees - The family member overseeing payroll creates “ghost” employees that do not exist and arranges for their paychecks to be direct deposited into their own bank account.

Inventory fraud - Family members with easy access to inventory steal it and then sell it themselves for profit.

Credit card abuse - Family members put personal expenses on the company credit card.

Cash skimming - A family employee steals by slowly skimming cash from the cash register or cash box before it’s recorded in the company books.

Fictitious vendors and suppliers - A family member creates a fake supplier or vendor—perhaps even a shell company—and then directs payment via check or wire transfer.

The reason it’s so easy for these types of fraud to happen is the weak internal controls at so many family businesses. The family treats the business too informally because it’s run by family members and nobody wants to suggest they don’t trust one another.

But if you’re not careful, fraud can eat away at the family business’s finances and eventually lead to its downfall. You’ve probably heard the stories. Given this high risk, it’s in your and everyone else’s best interest to make sure the family business stays strong—and the one way to do that is to put the right oversights and checks and balances in place. A CPA can help design these controls so all the bases are covered and fewer burdens are placed on family members to handle these often-sensitive topics themselves.

Here are some controls a CPA can help establish:

Avoid signature stamps for checks - Family businesses should also consider requiring two signatures on large checks.

Separation of financial duties - Bank statements should be opened by a family member other than the one preparing the bank reconciliations. Transactions and canceled checks should be reviewed by someone else.

Review of supplier and vendor lists - The list of vendors should periodically be checked for fictitious names, and, if suspicious, should be further investigated.

Review of payroll - Payroll should also be reviewed for unauthorized employees and unapproved pay by someone other than the person preparing payroll.

Have more frequent business meetings about finances - Make sure all financial reporting is transparent. Even if the family business member is not a “numbers person,” they should still make an effort to try to understand.

Establish clear expectations among all family business members - Be upfront with other family members on issues such as expectations, rate of pay and other benefits.

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