From widely published reports, it appears that Fidelity Investments, one of the world’s largest financial firms, has fired or allowed more than 200 employees to resign over their alleged misuse of an employee benefits program involving reimbursement for computers and physical-fitness accessories. An audit has revealed that a number of employees ordered and received the equipment, returned it, and then pocketed the reimbursement. In certain cases, employees submitted forged or altered receipts to collect the reimbursement.
I have always wondered why an employee would risk their reputation and careers over a relatively few dollars … even if it appears that everyone is “getting away” with the fraud on their employer.
SEVERE CAREER CONSEQUENCES
It is fortunate that Fidelity apparently did not want to take the time, effort, and money to prosecute some of these employees for such a relatively small amount and allowed them to “resign.” However, those employees with registrations under FINRA (Financial Industry Regulatory Authority) may find that the reason for their departure from the firm has been noted on their employee history which is freely available to employers, investors, and the public.
Some employees protested the action, to no avail, by claiming it was a simple mistake and that they forgot to notify the company of the merchandise return. For those who altered receipts and documents, no excuse can justify their actions.
Trust is the basis for all financial service providers and even the hint of untrustworthy employees can have a ripple effect on their retail business. To Fidelity’s credit, they allowed the report to go public rather than burying the issue from the public to avoid embarrassment like is done at so many other financial firms. What most people do not understand is that losses from employee fraud are just another operational expense charged to your account.