This episode is brought to you by Shopify. Forget the frustration of picking commerce platforms when you switch your business to Shopify. The global commerce platform that supercharges your selling, wherever you sell. With Shopify, you'll harness the same intuitive features, trusted apps, and powerful analytics used by the world's leading brands. Sign up today for your $1 per month trial period at Shopify.com/tech. I'll lowercase. That's Shopify.com/tech. Welcome to our podcast. It's about payroll. We're your host, Brian Escobar, and Walter William Duncan III. Whether you're new to the payroll game or seasoned veteran, we have something for you. Are you tired of manual employee time tracking and error prone payroll processes? Discover how time track go can revolutionize your payroll and HR departments. Join our upcoming webinar next Tuesday, October 29th at 2 p.m. Eastern Time to learn more about employee tracking for hourly and salary employees, streamlined payroll integration, a powerful mobile app with geofencing capabilities, accurate PTO tracking, and time-more requests, using an ordinary tablet for an employee time clock, and automatic holiday pay calculation. Again, this webinar is next Tuesday, October 29th at 2 p.m. Eastern Time. The link to register is in our show notes or you can visit time track go on Facebook or LinkedIn to register. Let's go. Welcome back, folks. This is another episode of It's About Payroll. It's About Your Paycheck. And today, we're covering always classic fun topic true payroll crimes. But before we get into it, what's going on? What's going on, my brother, I'm good. I'm feeling good. I'm motivated and relaxed out there a little bit of PTO. Oh, nice. That's dope. It's all good, man. How about you? How good? Yeah, I'm crying. This was something about crying, pushing through, reading the song. Like, I don't know. Just got to keep grinding. That was the answer. Keep going. Keep, like we say, right? Keep learning, keep growing, keep going. Most importantly, keep going. Real, man. Let go to row. Don't let go to row. Don't let go to row. And maybe just think about sharks. But they say sharks have to always stay swimming. Is that true I wonder though? They just sleep swimming? I have no idea. You've got to talk. Ask somebody who's smart. They're about that. Sure. Enough you would think with all the shark week stuff that goes on. For a second, I'm not sure we're going until the song, Baby Shark or something like that. Oh, my gosh. No. Oh, gosh. No, bro. Don't start with that. That song is what they call it. Earworm is fixing your head. Yeah. They killed it. Whoever started that stuff killed. I'm going to tell myself a little bit here. It's part of the inner kid and me, even though I'm in my 40s now. But a song that stays in my head is from the condo. We don't talk about Bruno. Oh, heck yeah. I don't know why. Yeah. Yes. That transcended ages, I think. Because adults, another, it was in earworm. And I think people just use it as, hey, we don't talk about that. I forget them. They killed it with that. Yeah. They killed it with that. We're about. All right, man. So let's get into it with the current events. Let's do it. News updates. So definitely want to send out our condolences and, you know, prayers and best wishes to everyone that was impacted by the recent storms. Hurricane Milton and Hurricane Helene. Definitely want to do what we can. And I encourage you, we encourage you to donate help if possible. Let's do our part to try to make sure that we're doing the best we can for our fellow Americans who are impacted by this and suffered great loss. Absolutely. Yeah. Good. Yeah. And then I wanted to give an update on the port strike. I'm sure some of you are already aware of this. That strike was supposed to happen. But the people that worked at the port decided to suspend the strike until January 2025. Because they didn't going to impact the economy. So good on them for doing that. I thought they actually struck for a struck construct. I thought it went on for a couple of days. Okay. But they decided to suspend it because they didn't want to have any impact for the fellow Americans. Okay. And they wanted to go. They wanted to give themselves some more time to bargain between whenever they suspended it until January 2025. Okay. All right. Yeah. Yeah. And then hey, the election is coming up. It's as a citizen of America. It's still right to vote. Not telling you what to do. But get out there and vote. Pack the election coming up or whatever if you want to. Or luck. If you don't ever have it, you don't like anybody. Then whatever. But. It's my last time. I feel like I had really years ago. Was it the year Obama was? Maybe right before that. I had advocated. I had done the same thing. Like it was election year. I was like, Hey, go out there and vote, go out there and vote. And one of my coworkers at the time, this is years ago, I'm like, Oh gosh. 10, 15 years old. Who knows? And they were like, I don't vote. I was like, then you part of the problem. We went in on them and it was crazy because another coworker was like, Yo, I heard you waited on this one and it felt the way. And I was like, Oh, if you're not part of the solution, you part of the problem. That's the way the math works. You know what I mean? To the extent that it's true because there's all this speculity. I've just heard some news clip that was saying, it's not really the popular vote. It's the like, no, it's facts, right? It's not our popular vote. It's the electoral vote that. But if I, I don't, and then that's the thing. I got to get smart around it because I feel like, but the electoral vote is based on the popular vote. But I don't know. I don't know enough about it. So I'm hoping that the vote means something. Even if you don't like the two that are there, there are always other candidates on there. And either you like one more than the other and you pull the vote away from that, right? Or you just vote for somebody else on neither one of them gets the vote. But then somebody else gets the vote. I don't know, man. Yeah. I don't know. Hey, but you might have it. All that said, you might have an impact. The outcome on election must have wasn't Brian was saying. So if you like it, if you decide to do it, go ahead and now's the time to register. Get out there so you can vote. With that being said, I'll move on to the short article that I had wanted to do an honorable mention because this is a true payroll crime story. So I wanted to do an honorable, honorable mention for just a quick story out of New Orleans. There was a former payroll manager that was the work of the law firm in New Orleans. And she was guilty of wire fraud. From 2017 to 2023, she stole over $2.5 million. What? $2.5 million. And so what she would do is she would submit false electronic payroll authorizations to an out-of-state processing company and basically put it into her account. And so the only reason that she got caught is because she went on vacation. If someone had to cover her for her work. The only reason she got caught is she's not smart because she leave that. How would you forget? Wait, oh crap. You know what? And that's a perfect example. We have been getting to it more. Yeah. Oh, man. Bro, if you read the story, she said that she started, she went big. From the first time she started taking over $10,000 per check. Dang. And then later increased the amount through the pandemic. Wow. Wow. Yeah, because you said $2.5 million. See, and as a thing, I always get so curious on the follow up. Did she get indicted? Is she doing time? Did she get convicted? She pled guilty. She was just sentenced. I could not find how much what the sentence was. She was just sentenced in September this year. And she said the maximum sentence is up to 20 years in prison. She was in the 20 years, but she was ordered to pay it all back in restitution. I don't think the, I don't think the, what is it? The punishment is enough in these cases. We've seen some with 18 months, two years because it's a non violent crime. And then you figure folks by no means am I encouraging this behavior by no means. You will get caught. No, like the game will be like, oh, Ryan, is that you get away with this? And it is no problem. No. I'm just waiting out our new part. It's how to get away. Yes. Yes. Yes. No doubt. No. Oh, God. So after they make shows how to get away, we're murdered. But no, I just don't think because if you think about it, she got two years, even three years. But she has still some of the money or if she just blew it, then yeah. The two years is fine. Yeah. They said that she's bad. She bought eight cars. So with it, like eight cars. He's old. That's still not $2.5 million. They were all member genies, you know, Ferrari, you know what I mean? Because then yeah, all the cars go back, but I don't know. It's just, I guess my point is if you actually saved, invested, and made some other winnings and getting money, you put a bag in the ground of it somewhere. You come out two or three years, you're just the money's still there and then the restitution has to be paid back. Yeah. But if you ain't got the money, the government's going to put you on a payment plan. They're going to garnish your wages or what, you know what I'm saying? All right. But if I have a million and buried in my backyard still, I'm going to come out and be alright. I don't know. I don't know. It's not worth it from me. Let's get that. Great. I know people who wins a prison. I ain't trying to go to prison, sir. There's no way. No. Yeah. There's nobody that I know that's been the prison that says, yeah, I'll go back. Like no. And nobody. It was definitely worth it. It was worth it. Yeah. No problem. I give it. I give it. All right. So what do you got first? Anywho, I got. What do we talk about? If you're the only one that, like, this is the wrong thinking about some employees is like, hey, if you're the only one that knows how to do a job, some folks thinks his job security, right? Yeah. Harvard Business Review dropped the article that kind of supports the psychology around why that is the case. And they, yeah, it's, they talk about why folks like some people think some employees that hold secrets feel like they have a really big status at the job. Like it drives how important they feel at work because they have a secret, but they do call out if they think the secret is like, I want to take a break real quick just to let you know about a new show, we've just added to the network. Up next at work hosted by Gene and K to keel of the Devin group, fantastic show. If you're looking for something that pushes the norm, pushes the boundaries, has some really spirited conversations, Google up next at work, Gene and K to keel from the Devin group. But yes, then it's the opposite feeling. So, but all that to say that for me, it drives that only me that we run into it everywhere you work. There's at least one person in there that you know that doesn't want to share what they know. They think it's a secret and you know, I'm valuable because I'm the only one that knows how to do this. Yeah. And it's not true. Because as a leader, I'm trying to change that like I can't have anybody in my team. And they're the only one that knows how to do things. Even my job. I'm not trying to be the only one that knows how to do what I do. I actively share how I do things and how what makes me good at this job. I think it's a part of business continuity. Yeah. Right. Just in case something happened with you or see, but you speak it from that leader mentality. You're like, wait, I agree. Of course you agree. You're a leader, but some frontline workers don't always feel that way because they feel like job secure and people even throw it around as a joke. And I'm like, it's, you know, I don't think I laugh at all when they have, like, but yeah. So anyway, the article just supports like that psychology around why secrets drive the way employees feel about things. And if you've got a good secret, that is, I'm important. I'm holding secrets for so just, yeah, exactly. For those of us in payroll, look, I guess there's a lot of jobs that it's just, it's part for the course. It's normal. You should be true. If you're in a trusted situation, you should be trusted. It's not something special. You should be able to be trusted in your whole world. Like in your whole life, people should be able to trust you. Now I don't say that to say, oh, you can't have secrets. Of course human nature, privacy things into, there are things that you hold close, but it doesn't mean that it's a secret is a, that's private is very different than secrets. You know what I mean? Anywho, yeah. I thought it was a good article. Pete, that check that out, folks. Yeah. Um, great stuff, Brian. Yeah, man. Likewise, bro. Let's pay the bills. Servals kidding. Let's pay the bill. Shout out to Time Track Go. Time Track Go has introduced an innovative new feature designed to simplify time tracking for both exempt and non-exempt employees. This feature aligns with the recent changes in fair labor standard act for salary employees. By automatically calculating standard 40-hour work weeks and accurately determining over time where necessary, Time Track Go ensures precise employee time while maintaining accurate PTO balances. Additionally, the system can identify instances where non-exempt employees may not have reached that 40-hour threshold. To learn more, please contact Conch, do you contact us? Time Track Go at 888-321-9922, or visit www.timetrackgo.com. That's T-I-N-D-T-R-A-K, go.com. Let's go. Let's go. Let's go get paid. You serve with Time Track Go, means that you're paid. Get this video. Yeah, for real. Do your time so you can get paid. You will get paid. Yeah. You're sort of saying. You need to do it. I love the... I love it. It's like trending. Brittany Fur puts has put a few of them out where people are making videos and stuff about finish your time sheets, submit your time sheets, submit your time sheets, and you can just hold in the assumption is it's the payroll person popping up at work with a sign. Oh, shout out to Brittany anyway, because she's the one who told us about this story that we're going to cover anyway for a true payroll person. Yes. But she big time in us, so she didn't got time to come do it with us, because I was like, "Hey, you should come and be on the show with this one." But yes, Brittany, we covering it. We didn't get the investigative part in, but the RPI is on vacation. So Walt is going to share with us some of these main points from this true crime. Yeah, I'm going to cover some key technical ways for the employees that may be thinking about this. And you look, because look, no, it's a real thing. Temptation is real. Yeah, right. It's a very real thing. Absolutely right. And it happens in different arenas, and it happens in different phases of life. Yeah. You could be in a position of life, like you've gone through a divorce, you're a single parent, and you're struggling. Your stroke is hell. Yeah. And look, this article that we're talking about, it involves a former employee who was a general manager at Wendy's in Lancaster County, Pennsylvania. She was charged with a Kuwait staff by creating ghost employees. She created a ghost employee stole nearly $20,000 over the course of the year. The ghost employee was named, William Bright, who was an actual person, believe it or not. Oh, yes. When you read the article, somebody that she actually knew, but he wasn't involved in it. He had known, apparently he's saying that he had no knowledge of this employee, this employee, former employee at Wendy's Linda Johnson, she was responsible for the payroll and logged the time for 128 shifts that were never worked for this ghost employee. The wages totaled a little over under $20,000, so $19,000, $198, and it worked 20,000. Yeah. And we're deposited directly into her cash app account. After suspicions from other employees led to an investigation, Johnson admitted to the scheme claiming she had used the stolen money to take care of her children. It wasn't a lot of money that brought you. Think about it. I know. And think about it. The only reason why I say that is over time, did they give the timeframe on the cost of a year? It was like I said, over the course of a year. Think about that. 20 $20,000 over a year is like another part time paycheck, basically. Yeah. I'm condoning the action, but 20,000 all at one time would have been, is a little bit more desirable where I would tend to believe her. She's, yep. She had kids to take care of and it does not justify the theft. So the time frame was from June 2021 to May 2022. What did you say in your research 18 months, 18 months, 18 months, you know, 18 months. So basically folks will discover it and while we do all these true crime stuff, right? And that's like the average that these cases go undiscovered, where it could go as long as 18 months. I think we've got found stuff that's gone longer. Yeah. But when you talk about average, the one I mentioned earlier was from 2017 till 2023. Oh, she got 2.5 million. She was doing it right. You're going to do it. If you're going to do something wrong, you might as well do it right. Yeah. But I'm sorry for this. And then the Johnson for doing for this because so did they talk about like conviction or anything like that about how much time she got? No, I didn't see that yet. I know that she's due to be sentenced. I know she was charged in 2023. She turned herself in on the August of 2023 as well. And she was released on bail for $2,500 on secure bail. So I, yeah, I think she's still waiting to be sentenced possibly. If not, I'll give an update if I can find out more. She did. It was wrong. She shouldn't. She should have to pay her dues, but she ain't get rich off this. Like she didn't. It was a life chain. Honey. Well, for her, for her, it was otherwise the life changing, sure. Sure. Sure. Yup. Agreed. Agreed. Yeah. Yeah. You know what I'm saying? Yeah. And look, so in my, in my head of somebody that was trusted, you know, and what do we find? What do we find out? Some of those T.F. We have some of the, this is those, it's high rate officials in leadership that do this a lot of times. It's a payroll manager. It's this or a payroll person that is unsupervised if you're not checking your super, your payroll person and ghost employee, for those who don't know, is it just as it implies. It's an employee. That's a ghost. It doesn't exist. Not a real person, even though this was a real person in life. And that, that, that wasn't a real employee to Wendy's. Yeah. You know what I'm saying? Yeah. But although we have seen it where they do use real employees that are terminated or something like that, either way, it's a ghosting type of situation where you're paying money to somebody who's not actually receiving it and you're rerouting those funds to yourself. And that's the whole ghost thing. It is, it's just not a real employee or not an active employee for more of a solid definition. Yeah. Yeah, folks. Look, I think, you know, I think when I see these cases, all these things coming into my head like, all right, money's tight these days, like things are always so expensive. I feel like she could have probably made more on a side hustle and not had, not ruined her life. Sometimes the easiest thing seems like the best solution instead of the hard thing, right? Like in that, in that case, it was probably easy for her to do, Hey, I don't have any oversight here. I'm able to go on the system and process payroll and create an employee and say this and say that and look, at the end of the day, my kids are being fed. We're good. My bills on time. And yep. And they'll justify, look, I'm not a therapist or anything like that. But they, in her mind, she probably justified it some way and to try to make her maybe so she was doing something like oh, no, she was took for herself and family. She was doing something like I think about John cute. You remember that movie that I was thinking about that all the time when I when I hear these cases and stuff like that, she's probably the closest one based on her excuse to come toward that because a lot, all the other cases we saw, like you could tell that they were just blowing the money and that's a great example because right at the end of it, he still was found guilty. Oh, yeah. Right. You've got to go anytime, but it was worth it because he saved his son's life. If you don't know, it's a John Key was a movie. Wow. It's a bit, it's probably been a while that it's been out. Denzel washes in go look at a great movie. He basically I think he did he like steal medicine or he held emergency room hostage so his son could get surgery or something like that and he gladly took the time that was coming to him to save his son's life. This episode is brought to you by Jira. If I wonder how those big marketing campaigns that make headlines get delivered on time, it all starts with Jira. The only project management tool you need to plan and track work across any team. Every step of that campaign is organized in one place, from launching the campaign all the way back to designing ads and writing creative briefs. Get started on your next big marketing campaign idea today in Jira. Because he couldn't get the money to the so he figured it out, hijacked an emergency room and chewed, wow, so they already that's that thing is 22 years older, yeah. Hey, everybody, I'm Lori Ruderman. What are you doing working now? You're listening to a podcast about work and that barely counts. So while you're at it, check out my show punk rock HR now on the work defined network. We chat with smart people about work, power, politics and money. Are we succeeding? Are we fixing work? Probably not. Work still sucks. But tune in for some fun, a little nonsense, and a fresh take on how to fix work once and for all. Yeah, good gosh, but it's a great, basically classic older movie now, right? Great flick. Go check it out if you haven't seen it and it's just basically that like somebody who did something, a good person that did something wrong for the right reasons and he took the time. And you may be in the position as an employee, no matter what industry you're in, you may be in a position where you have the opportunity to do it and you're thinking about it. You need to really think about the consequences because to Brian's point, yes, she claimed that she did it to she took the money to take care of her kids that did her of her legal responsibility. Still, maybe if it goes if it's something a jury or ruling or the judge, maybe he's a little lighter on the sentence, but he's gonna you go in a jail regardless, you get caught for that. Hey, it was worked for her. Great. Think about the risk. You have to think about it. Think about the risk. You're a professional reputation. This is a general manager. Yes. Oh my God. You say professional representation. I think about my co one of my coworkers, Lee, shout out to E. Lee and she just she pride her so so much on reputation. I was looking I was moving down here and it was I didn't even put I'm gonna put it out daily. I wasn't I wasn't asking her to lie, but she took it that resemble it was like I was just like, Hey, just so you don't remember when you know, I'm trying to get this job where I was trying to move down to Florida. And it was I was like, it was so long ago. I was just like, Hey, just say you don't remember girl, and she's like what? She gave me this whole speech beyond reproach and then I was like, yes, I know, but I wasn't even asking about all that. But so just when I when you say perfect when I hear professional reputation, I always think about Erica Lee. Yeah. And and just the example that she set for me in my career about that just big sis like just putting it down for me and I think we created it. What's the thing we said? You are your brand. That's right. That's right. So yeah, we're gonna that with you now because of the choices that this person made exactly for a new brand work. Yeah, it'd be hard for and I was thinking about this, wait a minute, man, you're like, how are you going to work later? You're doing this for the now, but if you get caught now, are your kids now in a worse situation? You gotta go do time somewhere, you gotta eat, it's gonna be hard for you to get a job. Anything and even a trusted value as far as work is concerned, you're not gonna be able to get it. Yeah. I don't know. Folks, I think folks just are not thinking of the consequences. And yeah, I'm telling you, you talk to more criminals than not and they tell you it's not worth it. Yeah. If there's somebody out there that says there is, there's probably some mental wellness issues with them. You know what I mean? There's nobody of their right mind that continues on that criminal route after they've felt some consequences from it. There's just nobody that I've met and I've been in and not as a resident. But I've been in prison and I've talked to people. And one dude was like, oh, I do not want to come back in a more and guess what? You know what I have to do to stay out of here? Now do crimes. Yep. Yep. That's it. But sometimes that is doing the hardest thing. And look, when you have to feed your family, sometimes doing the hard thing is like having a second job is working on a double shift. So I'm at with a lot of parents that are doing there right now. Get on a little talk. Yeah. Look at that. We just saw a post and it was like somebody was like, somebody in your family needs to be pursuing TikTok or social media. It's not guaranteed. But that's why I said somebody needs to be pursuing it because you never know what you can spark and boom. If you, there's so many people, one hit wonders that leverage things and take it who we got some takeaways. Yeah. Once you get. You want me to go first? Yeah. I talked about the stuff for the employees about this world representation. Oh, did you? Oh, look at you. Look at you. Working it in all. Yeah. Smooth. For you to put a letter. Yes. So I'm takeaways for the employers, the managers and the owners of things. And then this could stretch to pay rollers as well, depending on how much influence you have in your job, how much you want to help your job. I think it's a great opportunity for payrollers to learn from these things and even just not payroll as folks. If you're someone at a job where you can lend insight on things, if you're an HR, if you're a manager, if you're an operations, like almost anybody could go tell somebody, hey, I heard I heard this podcast, it's about your paycheck and they said these things happen. So let's how about we get strict on our stores and implement these things so that we can catch this stuff. You could literally be anybody at a job. And if it's applicable, make the recommendation. People love it. Save me some money. You save again. Hey, now we're talking, right? Because again, if you all haven't picked it up yet, Walt and I have been successful in our careers because we do things that help our companies grow or save money. And even if it's incremental, it could be little. It could be little. Those little things build up and hey, maybe I didn't sell a deal that made a billion dollars, but I did something in payroll that saved a thousand dollars. And if I do that every payroll, guess what, saving significant money, you know what I mean? Just for your managers to think, oh, wait, wow, he's doing something that is or she is doing something that helps that strengthens the payroll oversight or the managerial oversight. Right. So that's the number one takeaway on the employer side is strengthening your payroll oversight. This was a ghost employee, okay, so employees should implement little stringent controls over the payroll process. It should be, first of all, me and Walt, teach that literally, we literally teach this to pay rollers is you have to have oversight. You have to have audit, right, controls in place. We teach it in our course. We say, hey, these type of things happen. And these are the ways to protect against it, right? Allowing one person to control the beginning to the end of something is not a good control. You need somebody to check that. Even if it's hindsight, right, hey, I mean, I have time to check it in the midst of processing payroll. But if somebody was checking this manager after the fact, they would have seen, wait a minute, who's this guy? Yeah. Where's William at? I've never seen William Bright. He went up in here. Like Bright Light, so he would, they would have seen no light and they would have figured it out. Right. Yeah. That type of one person over at all creates a big vulnerability for payroll. Yeah. Absolutely. Okay. Regular reviews, multiple approval steps, and especially now with systems, one of the big questions that we get when we teach is, oh, why is, how does a payroll system help? And whoa, payroll system helps because you can build in workflow, you can build in controls, you have robust reporting that allows you to analyze this data. Sometimes a really good system has the dashboard for you already and is calling out the things. And as AI continues to grow, I imagine these systems are going to start catching a lot of this stuff for us. Yep. You could have those trial systems play soon and just start reporting it up. But guess what, if you have only one person in the system that knows the whole system and nobody else knows it, as I say in earlier, the secret, not good, you remember that story that we did? I was one of the true, feral stories where a person in California or something like that was the only person with the access, the login credentials. Yes. And I think they resett them or what it is, something to let the city was locked down. They couldn't do anything for a little bit a little while because this one person was the only person who could actually do that. I hear that story now in technology cases still. This person had the only login. They left. They gone. The time and time again, use of technology as we're talking about pay words and passwords and this stuff, right? Use of technology. You got to make sure you have redundancies, right, because employers can leverage automated payroll systems that flag suspicious activity such as excessive shifts. That's a time and attendance system. Use a good time and attendance system. Shout out to time track. Go. Check them out. Have a time and attendance system. Go look up time, track, go. Go get it. Employee reporting channels encourage a culture where employees feel comfortable reporting suspicious activity, okay? You got an anonymous. Make them feel comfortable doing it, right? In this case, employees will raise the concerns for you. That's an awesome thing, right? Radical transparency of employees feel like, look, you're stealing. That takes away from what I can grow from, no, you can't do that. Comprehensive audits is another one. We talk about this in our courses ad nauseam because these are the things that help you cash this stuff. Have good audits. And then five, the last one is insurance and recovery. Employees should have fraud insurance in place to protect against losses. In this case, the restaurants insurance covered nearly 16,000 of the stolen amount, reducing the final impact on the business. But that's that was great. Yeah, that's a great. It reduced the loss because I'm sure there's a premium even there. Yeah, I got insurance. I lost 20,000. I got a thousand dollars deductible. Yeah. Okay. 16,000 was what I get back. Okay. Hey, that works. Right? Because it's helpful. And that's what is out there for build the safeguards, folks. If you're an employer out there, you may say or a manager, again, anybody with influence so that somebody's listening, build in these safeguards and help them minimize that risk. Yes. Because we could add up a lot of money, man. Yeah. So because think about it, if you're a payroll manager and you have a team of people that process payroll for you, but you process the corporate payroll, you should have at least, in my opinion, there should at least be one person on your team that you trust enough, just in case you're out, on vacation, that they can process the corporate payroll. Absolutely. Your stead, right? It's all life. Absolutely. That's an example of you not operating in a silo because me and my operating in a silo, I'm the only one processing in the corporate payroll and I'm the only one with access to do that. So we're on reports and stuff like that. That may bring a situation up where that temptation comes to the place and God forbid the situations in my life, there are prevailing situations in my life where I am to decide to do that because I need the money to do that because the bills are piling up and hey, riches behind and stuff that we're struggling like you said earlier, of us are experiencing hard times. What is that? What is that stat? Like 50 percent. 60 percent of Americans live paycheck to paycheck. 70 percent. 70 percent of Americans live paycheck to paycheck. So it's a perfect segue into the safe talk. In your opinion, was the failure on multiple levels since this situation wasn't prevented from the beginning, especially since an external audit found the issue? Oh, is that was the case with this? Yes. Oh, employees may have raised a concern, but this one all for a year in it. And so the employees raised a concern about it eventually, but they should have already had an audit in place regularly to cash to cash this. Yeah. Like at least quarterly. Yeah. But yeah, if you're not doing it every paycheck, but think about it though, we're in the mix there. Right. If they go up to, because of Wendy's, it might not be standalone, even if it is, right? If the new hire reporting is going from the general manager up the ladder to someone else, they don't know who's in the Wendy's, they're like, all right, great, new hires boom. And they filed the report. It's automate. Right. Some of the systems is automated. And look, if they, if she used somebody that she knew, so maybe she had access to her social input. So he may, maybe when you feel that he verifies not right as a legitimate person, a legitimate person. He verified would have validated how else guess the cook to the real back to the question. Do you feel like there were multiple failures on the different levels, HR payroll since it wasn't prevented? I don't know. I don't know. I think that I'm thinking through, right, because I'm in this loop, like we're both in this loop. Yeah. I mean, think you were like with the amount of data that we process through. Look, but for me, a company now, I understand that not all franchises, especially in the case with Wendy's, maybe they all don't process payroll through the same format like that. So it'll be easy for me to say, Oh, they should help. They have a quality control person to check on that stuff, but that may not be the case. You know what I'm saying? So it could be. Yeah. I mean, because the threat, the way it works, it could be the owner owns one or they can own a hundred. Yeah. Yep. But we don't know. Right. Believe me, I do think of ways to try to prevent this stuff and catch it. So clearly there was a failure somewhere. But the audit, hey, the third party audit caught it. Those auditors look great now. And they were insured. So they covered the insurance company covered the majority of that money. So $500,000 of $20,000 was covered. Recovered. So the reverse is going to go, you're going to have, you fired the person, they're going to have some legal impact. I think it's solved. So for me, case calls solve and as far as that franchise owner, maybe you increase that audit to twice a year. Sometimes whatever audit caught it twice a year. I do an audit that's fairly simple and it's checking direct deposit accounts. So I'll run a report and see how many duplicates I have, if any, on direct deposit accounts. Now, that's not to say, hey, we were, and by the way, folks, we're running over here and we're talking more payroll stuff here, feel free to drop anytime. But this is interesting stuff. The audit, that's not to say that you can't have duplicates because I have run in situations where I have a man and a wife or a spousal couple of partnership, even parental parents and children that share direct deposit accounts. And look, in this case, she was having the funds directed positive into a cash app. A cash app. Yeah, but still is this, which they probably can pull the info for and look it up somehow. I would love to see how they actually caught this because there's probably another way that I'm not even thinking of on the employee standpoint. So that's one of the ways I catch it. Another way that I catch or not catch it, but encourage a check is if a new manager, if I onboard a new manager at Endeavor, I used to, a new school leader would come on, and I would encourage to see everybody, I would say, hey, here's your rock. Here's how you pull your roster. Please make sure that you put a face with all these names, validate who these people are. And you know who your team is. And they were small enough that it was an easy task because they're, oh, yeah, of course. And everybody was there with super professional and they, oh, absolutely, no, without doubt. But it was just something to do. That's another way. And you could warn, and that's the way you're warning the manager as well, because if they were fraudulent, you could that kind of let you know, oh, shoot, Ryan, talk about, I need to see all these faces, that means he's looking at this already. So another good audience before we close this out, is because she manually entered the time from this person, oh, so you can do an audit because most times, it goes time system. So you can see who made the entry with the punch. So, oh, I'm seeing it. Why does she enter all this stuff? That's a really good. So what Walter's saying, if you have an automated system and one out of a thousand employees are automated, and this one person is getting keyed in their whole time, every time that is core. But that it's impossible, not that it's, no, meaning something's wrong, right? It doesn't have to lead to fraud. It could lead to, oh, yeah, that's my son, and I just do his thing all the time, or all that's, you know, you're going to find something wrong behind, like, why are you doing it for this one? Oh, as my friend, and it does, I'm not saying it's right at all, but it's going to be something wrong behind that, you know what I mean? But that's, yeah, that's a good one. That's a good one. And that's the thing. And that's why we say use reliable systems, go get the time track goals, go get the systems out there that are reliable, because you can pull these reports, you can create these audits, you can create the bells and whistles. Another one, for instance, is some systems will let you know as a person. If my direct deposit information changes, I get an email from my sister that says, hey, your direct deposit information just changed. So if somebody was actually happened to, was able to hack into my account and change it, but they didn't reroute the email, like they didn't know enough to change something else. Guess what? I'm going to get it, right? And even if they change the email, you're going to get that as well. There's going to be notifications on it. So that's a good way as well. There are a bunch of little things, right? You know what I mean? And folks, just listen to the episodes, go look at our auditing ones, go look at our true crime ones. We talk about it all the time. Every time it comes up, I try to think about new stuff to share. Hey, reach out as well. Let us know. Oh, thank you. Any audit, any checks and balancing, clever ways that you use and the controls that you use currently, we'd love to hear about it, man. Oh, that's it for a little bit over today, but it'd be all right. Yeah. It's all good. Young. Until next time. We love you. Thank you for being part of our payroll community and thank you for being a part of this journey with us. Until the next time, keep learning, keep growing, and most importantly, keep going. [MUSIC PLAYING]
Hosts Brian Escobar and Walter William Duncan II conduct a podcast that delves into payroll innovations, such as the TimeTrack Go system for increasing HR efficiency. The episode touches on recent news, including Hurricane Helene and the postponement of a port strike to January 2025, while encouraging voter participation. It features a 'true payroll crimes' segment, discussing cases of payroll fraud involving substantial embezzlement. The script explores ethical dilemmas faced by employees who commit financial crimes, referencing studies from the Harvard Business Review and real cases like wage theft at Wendy's and Linda Johnson's payroll fraud. Practical advice on preventing payroll fraud through audits, automated systems, and rigorous validation processes is also provided, emphasizing the importance of transparency and robust payroll oversight.
00:00 Introduction to the Podcast
00:23 Upcoming Webinar Announcement
01:18 Casual Conversation and Catching Up
03:17 Current Events and Updates
06:39 True Payroll Crimes: New Orleans Case
16:17 True Payroll Crimes: Wendy's Ghost Employee
20:45 Financial Struggles and Justifications
21:49 John Q: A Moral Dilemma
23:10 Consequences of Fraudulent Actions
23:58 Professional Reputation and Integrity
27:13 Strengthening Payroll Oversight
28:53 The Importance of Audits and Controls
30:14 Leveraging Technology for Payroll Security
34:44 Case Study: Payroll Fraud Detection
38:14 Final Thoughts and Takeaways
42:24 Closing Remarks and Community Engagement
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