A few years ago I was talking to a nice lady I knew who was a practice management consultant. We were talking about her career and the kinds of problems she helped offices solve. The discussion eventually progressed into discussing overhead and accounts receivable. It was at that point in the conversation when she told me that it wasn't uncommon for a doctor to contact her with cash flow problems of unknown origins.
However, when she dug into the numbers and reports she'd discover... embezzlement. Her feeling was that it happened in 20-25% of the offices she worked with. Now this gal was good with numbers. That was one of her strong points, so maybe that had to do with why a doctor contacted her in the first place, but I was stunned by some of the stories she told me.
It's hard to believe that you can work closely with someone, sometimes for years, only to discover that they were stealing from you. Unfortunately it happens... and it happens a lot. I frequently post about cyber security because I'm a tech guy, but plain old accounting security is just as important.
To bring this into a tech perspective, today's practice management software systems are really strong when it comes to the practice numbers and accounting. It takes a certain amount of effort to cover up the tracks of embezzlement. That's why I was amazed when the consultant told me that the biggest mistake she saw doctors making was simply NOT reviewing the daily reports their software generated. She told me I'd be shocked at how many doctors are given daily reports and simply put them in a file somewhere and never look at them.
She said she had seen that numerous times. She'd be called in because the doctor was struggling to meet payroll and when she asked how often the reports were reviewed she would get nervous or blank looks from the doctor.
So the advice in today's post is "review your day sheet" and the other reports your software generates. I always did because I found the stuff interesting, However a lot of doctors trust someone only to find out that trust was abused. It might have been President Reagan in the 80s, but someone famous once said, "Trust but verify" and I firmly believe in that. A trustworthy person wants you to know they can be trusted.
The whole reason for today's post was an item I happened to see from the Nassau County Police Department in Long Island, NY. It seems that the 34 year old office manager managed to embezzle almost $290,000 from a dental office. The age of the suspect shocked me because it means this wasn't a trickle of dollars over a long period of time. Even if the suspect had started embezzling at the age of 21, that would have been around $22,000 a year... and I doubt the theft had been going on for that long.
So in closing... trust but verify. As you read this, some office somewhere is being embezzled. Do the best you can to not be one of them. Cyber security *is* important, but so is financial security.