“Good morning!  Thanks for calling XYZ Company; how may I help you?” 

The restaurant industry is rife with ways to lose profitability.  Just when you think you have things buttoned up, a new twist comes along that can threaten your business and you may not even know about it.  Last year the restaurant industry lost an estimated $200 million to a theft scheme called “skimming”.  The cashier or server is equipped with a portable electronic device commonly known as a “skimmer” that can be easily be hidden in a pants pocket.  When handling customer credit cards the employee swipes the card through the POS system to capture the sale and while still in possession of the customer’s card, swipes the card through the skimmer as well.  The customer’s information contained on the magnetic stripe on the back of the card is captured in the device.  The information is then typically sold or transferred to organized rings that produce counterfeit cards and rack up fraudulent charges.  

The assistant manager was in charge of inputting hours worked by employees into the back office system.  She was very diligent in making sure employees were paid accurately and that the employees were punching in and out correctly.  She applied correct discipline to those that forgot to punch in or out.  Her supervisor was proud of her that she took such care in the accuracy and discipline of their payroll.  He was so confident in her competency that he left it all in her hands.

It’s a crime that is reported almost daily.  Customer credit card information compromised, identities stolen, and economic crimes escalated.  A local news account of a man attaching a credit card skimming device to an ATM machine at a local bank caught my attention.  The same man was observed the next evening at another banking center and the suspicious behavior was reported by a bank customer when she noticed tape covering a security camera.   What made this a concern to me was it was my bank!  I have used that particular ATM several times.  I could easily have been a victim under the right circumstances, but luckily the timing was in my favor.

It’s funny how the more things change, the more they stay the same. “Secrets of a former credit card thief”, by Michelle Crouch on CreditCards.com has many of the same principles as “Catch Me If You Can”, the story of Frank Abignal. Abignal’s book and movie starring Leonardo DiCaprio was a real life tale of crime involving fraudulent checks passed by Abignal and his ability to change identities and personas. He was chased by the FBI for years starting when Abignal was just a teenager. He was subsequently caught, convicted and forced to tell the secrets and provide the training to law enforcement to catch others. That relationship was pivotal in security changes within the banking industry.

He was a great find. An experienced fast food manager walked in and applied for an open shift manager position. He interviewed well and obviously had a great deal of experience. All of the favorable first impressions were verified with a phone call to a former district manager of the applicant, who gave a raving endorsement of his abilities, aptitudes and experience. “We hate to lose him” was the most memorable comment by the former supervisor.

The New York Times and Scambusters report that employees of a company found a number of USB drives, commonly known as “flash” or “thumb” drives bearing their company logo scattered around its parking lot.  Curiosity dictated that they plugged them into their computers in their office to find out what was on them.  They found what appeared to by a document that installed malware that stole confidential information from the company’s computer network.

Losses to restaurants can occur from just about anywhere. We talk about cash stolen from registers and from customers by a multitude of internal fraud schemes. Food losses can mount from poor inventory controls and thefts through the POS or out the back door. Crime can generate huge losses from robberies, burglaries and external fraud scams such as credit and gift card fraud. Neglected safety precautions may result in losses from slip and fall accidents or OSHA fines. But how about losses generated from members of the restaurant chain’s executive team to the tune of $1.9 million!

The operation was dubbed “Operation Easy Money”.  Apparently the name was a pretty accurate reflection for the 62 individuals involved in food stamp fraud in Palm Beach County, Florida.  Store employees rang purchases, giving cash back to the holder of government issued food stamp cards, and keeping a cut for the store – or themselves.  Little or no food changed hands.  The simple fraudulent transactions converted the food stamps to cash, thus – easy money.

The Shift Manager of the fast food restaurant sat in his car, under a shade tree in a parking lot. On the floor board are unused disposable deposit bags and a used deposit bag that had been sealed with last night’s closing deposit. The manager had sliced open the deposit bag and the passenger seat is littered with the contents - ones, fives, tens, twenties, and change. He will use one of the unused bags to make a new deposit. The manager counted the funds several times, his stress level mounting. The amount is not enough to match a deposit slip for a deposit dated two days ago. Two days ago? What is going on here? Why did he open a deposit bag today for funds to match a deposit ticket that is two days old? Do you know?