Embezzlement risk high in Idaho

BOISE – An investigation firm’s study of large-scale employee thefts shows Idaho ranks seventh in the U.S. for risk of embezzlement.

Marquet International of Wellesley, Mass., released the report on major embezzlement cases in January. The company reviewed 473 cases of employee thefts in 2011. All the thefts were of $100,000 or more, and they represented as much as $354 million in losses.

Chris Marquet told the Idaho Statesman that Idaho’s high ranking is likely because of the trusting nature of the state’s many family-run businesses. He said Vermont topped the risk list for the same reason.

“Small businesses are the ones at greatest risk because, typically, they have very little infrastructure or controls. There’s no budget for it,” Marquet said. “Or no perceived need. The business owner ends up relying on a single bookkeeper for 15 years.”

Analysts generally expect the level of fraud or embezzlement to be proportional to the state’s economic output. Marquet said Idaho’s rate is more than two times higher than expected. Still, Idaho doesn’t have a large number of big cases: Marquet counted three in 2009, seven in 2010 and six in 2011. Some of the court cases have not concluded.

In terms of the number of cases, California had the most with a total of 63 cases of embezzlement over $100,000. Michigan and Pennsylvania were tied for a distant second, with 28 cases each.

The state with the largest estimated overall loss was New York, with $48.9 million.