As a practice owner, a dentist will face a multitude of business related tasks, issues, and challenges. The rewards far exceed the drawbacks, but there are challenges. One of the challenges may be employee theft. Estimates of the number of dentists who will experience theft at least once during their dental career range from 35–50%. Estimates in dollar loss range from $100 to $500,000+. Loss due to employee dishonesty may take the form of theft, fraud, or embezzlement. With certain minimal protective measures, the majority of this theft is preventable. The key is to understand where the potential exists for theft to occur and implementing strategies to prevent the loss.
Meet the Thieves (All names are fictitious)
Jane the Eraser–Jane simply withheld any cash payments that were made for services and then erased the patient’s account information after posting the payment (and giving the patient a receipt), thereby removing any record of the payment from the system. Estimated loss—$50,000+ over a three-year period. The doctor recovered $25,000 from his office insurance plan. Jane was ordered to pay $10,000 restitution.
Doris the Duplicator–When hired, Doris had successfully lobbied against computerization, convincing the doctor that it was not as efficient as the old manual pegboard system. In turn, Doris kept a duplicate set of patient ledgers. Payments and receipts were recorded on the duplicate ledgers while charges were posted on the real ledgers. Over a period of 18 months, Doris stole an estimated $40,000.
Mary the Master–Mary was involved in skimming, taking cash and not posting it; layering, a technique involving the taking of checks and withholding them for posting later; and an excessive need for petty cash, going through about $100 per week. Mary also set up a second business checking account in the dentists’ name (she was the only authorized signer) and subsequently diverted the office credit card deposits to that account.
Mary paid all office bills, using erasable ink and thereby allowing for the checks to be made out to her personally and then changing them back to legitimate vendors after they cleared the bank. The deposit slips never matched the bank deposits actually made, and subsequently the checking account could never be balanced with the ledger.
The doctors noted that while each year their taxable income had increased over the prior year, according to the computer, their accounts receivable had spiraled out of control and was showing a balance of $500,000+. Over a five-year period, Mary had embezzled $400,000.
But first do a quick GOOGLE of “theft in the dental office” – then pick your chin up off the floor.
http://www.slideshare.net/davidharris9999/canadian-dental-associationteaser-presentation
http://www.mainebiz.biz/apps/pbcs.dll/article?AID=/20120111/NEWS0101/120119988
http://www.yakima-herald.com/stories/2012/01/13/sunnyside-clinic-employees-suspected-of-theft
http://www.mckenziemgmt.com/sem-Ramsay.htm
[youtube]http://www.youtube.com/watch?v=ByI5pzT06SM[/youtube]
