Embezzlement seems like an issue for large corporations. Unfortunately, small businesses are at an even greater risk than their larger counterparts. Researchers with the Hiscox Embezzlement Study report white collar criminals most often embezzle from small and mid-sized businesses.

The study defined small and mid-sized businesses as those that employ fewer than 500 workers. These businesses were most often victims of schemes that took away small amounts of money over a large period of time. The losses were severe. The study notes businesses lost an average of $1.3 million over the span of the scam.

Although the crime is subtle, researchers with the study recommend business owners watch out for these common characteristics to help identify a potential embezzler:

  • Ambitious. Employees that commit white collar crimes are rarely lazy. These individuals are normally ambitious, willing to learn as much as possible about the business. Unfortunately, the motive behind this willingness is often self-gain.
  • Ambivalent. It is not uncommon for an embezzling worker to overuse sick time or otherwise not follow company protocol.
  • Upset. The study also found embezzling workers often felt wronged by the employer or business owner.

Researchers with the study reported funds theft was the most common form of embezzlement, followed by check fraud. Business owners are constantly balancing business risks with potential rewards, but becoming the victim of a white collar crime should not be one of these risks. As such, business owners can better protect their business interests by using the information from this study to adjust security protocol and reduce their exposure to potential embezzlement.