EmployeeScreenIQ Blog

“Hi, I have access to Disney’s (DIS) quarterly earnings report before its release on 5/3/10.  I am willing to share this information for a fee that we can determine later.”

That was the email message sent to various Wall Street traders from the boyfriend of a Disney employee who was the assistant to the head of corporate communications.  Instead of pursuing the offer many of these traders reported the information to the SEC.  A sting was set up, the gruesome twosome were offered $20,000 for the information and bam! they were arrested.  According to the Wall Street Journal, the employee was in it for the shoes.

I am certain that Disney employs stringent employment screening requirements including a comprehensive criminal background check.  And it isn’t being reported that the employee had any prior records.  This story just underscores the need for employers to be vigilant in their screening efforts.

Disney Drama As Stock Plot Is Foiled- The Wall Street Journal

Federal authorities alleged Wednesday that a Walt Disney Co. executive assistant and her boyfriend engaged in a ham-handed plot to sell Wall Street traders inside information, first offered in a chirpy missive sent to dozens of investment companies.

“Hi, I have access to Disney’s (DIS) quarterly earnings report before its release on 05/03/10,” the March 5 letter began. “I am willing to share this information for a fee that we can determine later.”

The alleged plan went awry. Instead of taking the bait, “multiple hedge funds reported the illicit scheme,” the Securities and Exchange Commission said in a press release.

In a pair of complaints filed Wednesday, federal authorities said the letter and subsequent emails were sent by Yonni Sebbag, whose girlfriend Bonnie Hoxie was an assistant to Disney’s head of corporate communications.

Disney said in a statement Wednesday that it “has been fully cooperating with this investigation.” Ms. Hoxie was at work as recently as Tuesday, according to people at the company.

A federal judge ordered Mr. Sebbag held as a potential flight risk and released Ms. Hoxie on a $50,000 bond Wednesday. Neither responded to the charges in a bail hearing Wednesday.

The March 5 form letter was sent to 33 investment companies, according to a criminal complaint filed by the U.S. Attorney’s office in Manhattan federal court charging the two with conspiracy and wire fraud. Undercover agents from the Federal Bureau of Investigation began corresponding with Mr. Sebbag, who used the pseudonym “Jonathan Cyrus” in the email exchanges, according to the complaint.

As the earnings release approached, Mr. Sebbag, 29 years old, and Ms. Hoxie, 33, engaged in an awkward exchange of their own as they waited with growing frustration for the quarterly earnings data to materialize, according to transcripts in both complaints. The exchange at points took on the tone of any couple bickering over mundane issues like bill paying.

“Get things moving with all the powers you have,” Mr. Sebbag urged his girlfriend at one point.

“Thanks for the flattery,” Ms. Hoxie replied. “I wish you could come to work every day with me.”

On the day of the earnings release, Ms. Hoxie sent Mr. Sebbag an email stating “here is the bag that you are going to get for me,” the SEC said in a companion civil complaint filed in New York federal court. It said the email included a link to “a picture of an expensive Stella McCartney designer handbag available for $700 at Neiman Marcus.”

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A Georgia woman has been accused of stealing from residents of the nursing home that she worked at.  Coastal Manor Long Term Care Facility said they conducted a comprehensive background check on the woman.  Nursing homes are required to conduct background checks in many states and apparently the problem of abuse in nursing homes is so prevalent that it has its own blog, Illinois Nursing Home Abuse Blog. The fact that this blog exists at all should convince any nursing home that is not currently conducting background checks the need to start ASAP!

Woman accused of stealing at nursing home

 LUDOWICI  — An employee of Coastal Manor Long Term Care Facility was arrested Friday and has been charged with stealing from the nursing home and several of its residents.
According to Ludowici Police Department Investigator Sal Genualdi, Demetria Denise Williams was arrested after Elise Stafford, the home’s chief long-term care officer, reported the center had information showing an employee had been stealing.
After gathering information from Stafford, Genualdi went to Coastal Manor and arrested Williams, 28, a military spouse who lives on Governor’s Boulevard in Hinesville. �
Genualdi said Williams was then taken to the LPD, where she was charged with theft by deception, theft by taking and exploitation of the elderly.
Genualdi said Williams has been charged with stealing more than $4,000 and that he anticipates as many as 25 more theft warrants.
Genualdi alleged Williams stole from residents by taking money for their families, but not depositing it into appropriate accounts.
Stafford said Williams also stole from the facility by taking payment of services not provided to residents.
“The majority of the money that was stolen was from payment for services,” Stafford said. “There was a minimal amount taken from the residents.”
She said she has reported the alleged crimes to state regulators and has asked for an independent auditor to look at the incident.
Genualdi said the initial charges all related to thefts from individuals, not from the home, which operates under auspices of Liberty Regional Medical Center in Hinesville.
Stafford said job applicants go through criminal back ground checks and that nothing was found on Williams to have prevented her from being hired.
“Our goal is to provide good quality care for our residents, and to protect them from any type of abuse,” Stafford said.
Genualdi said a $5,000 bond was set for Williams, but as of Thursday, she was still in the Wayne County Jail.

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A Philidelphia law firm is feeling the burn after discovering a former employee is responsible for forging checks totaling more than $100,000 from the estates of the firm’s deceased clients.  Assuming that the legal recruiter who recommended the employee for employment had conducted a criminal background check, the firm hired her.  Little did they know that she was awaiting sentencing in New York for stealing $285,000 from her previous employer – also a law firm.

A partner in the law firm states in this news story that the recruiter obviously didn’t do their job since a criminal background check was not conducted on the employee.  Well, unless the law firm made that a requirement in their contract with the recruiter, they never should have assumed the vetting process was taking place.  I believe it is unfair of the firm to throw the recruiter to the wolves over this one when they themselves didn’t conduct their due diligence and make sure the recruiter was conducting the background check. 

It is incredibly important that businesses work with their recruiters and staffing agencies to iron out an employment screening process and determine which types of background check results are acceptable and which are not .  Making assumptions about such an important process can be a costly mistake.

Parelegal charged in 100G theft

By Stephanie Farr, Philadelphia Daily News – May 19, 2009

Kathy Foer-Morse didn’t fit in at High Swartz law firm in Norristown.

She showed up late, left early and couldn’t be located during some workdays, according to her employer.

After her termination, partners at the firm said that they discovered $100,937 couldn’t be located, either.

During a subsequent investigation, detectives learned that the former estate paralegal was awaiting sentencing in New York for stealing $285,000 from the last law firm where she worked, and that she had used the money she allegedly stole from High Swartz to pay restitution in the New York case, said Kevin Steele, Montgomery County first assistant district attorney.

“She clearly didn’t learn her lesson,” he said.

Moreover, rather than take from High Swartz’s accounts, Foer-Morse wrote checks to herself from deceased people’s estates and forged the executor’s signature, said Paul Bartle, managing partner of High Swartz.

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Fraud experts and security professionals are on to you! We know why you steal……we know how you do it.  The tricky part seems to be WHEN and exactly WHO is going to commit the fraud.  This is an excellent article from Human Resource Executive Online.  I was actually surprised to see it here rather than my favorite security publication Security Management. In it the author explores several ways an employee can (and will) steal from you when given the chance.  More importantly, there is a strong emphasis on background checks towards the end.  I don’t have to remind you, our economy is not too good.  Employees are in fear of losing their jobs and don’t know how they are going to put food on the table.  Mitigating your risk is more important now then it ever was.  One small incident can put you out of business.  One small incident that could have been easily prevented will be very embarrassing.  There are many ways to prevent fraud! One should always remember; Opportunity Only Knocks Once, But Temptation Leans On The Doorbell!

The Criminal in the Next Cubicle

The recession can put pressure on employees to steal, and employee theft and fraud typically increases in tough times. Tip lines, prudent procedures — and forced vacations — may be just the answer.

By Cyril Tuohy, Risk & Insurance®

The fraud starts off small, in the form of a micro loan, just a couple of hundred dollars perhaps, to be repaid a few weeks later, interest free. The intent, of course, is to reimburse the employer, in this case the unwitting “lender.”

But before long, the perpetrator is in too deep, and the temptation to steal yet more money is just too strong. And the employer finds itself with a criminal working inside one of its cubicles.

“They take just enough to help them though a financial crisis, and when the money is spent, they do it again, double dip, triple dip,” says Greg Bangs, vice president and crime manager with Chubb & Son, based in Warren, N.J.

Then criminals snap and “go big” as the scale of their fraud increases. In one recent case, a $4 million electronic-funds transfer was routed through four countries on three continents within 48 hours, he says.

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