Credit Management March 2018

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LEGAL MATTERS Is theft just a retail problem? Looking at debt that often goes unreported and unrecovered DD 0113 261 6158 E kevin.feehan@dwf.law W www.dwf.law/recover Kevin Feehan Director of the Recoveries team SHOPLIFTING – there’s a term most people are familiar with and it is recognised that major retailers, many of whom we act for, are the victim of this criminal behaviour. What is less recognised is that theft often occurs by those we trust most, those we employ and those we work with. This takes many forms such as expense fraud, stealing cash or goods that you have within your business or defrauding your IT systems. In fact, statistics show when theft is carried out by colleagues, the values are significantly higher than the type of incident we associate with shoplifting, with an average colleague theft accounting for a loss of £1,031 (per British Retail Consortium Crime Survey published 2015). That is before you take into account the cost to your business in respect of the time and resource spent investigating the incident, and the time spent dealing with the HR disciplinary process. What also isn’t recognised or admitted, is that theft isn’t just a retail problem, it happens in every industry and in every sector of the economy, from transport and logistics, to manufacturing, banking, local/ central government and professional services (if you are reading this and aren’t on that list, I'm afraid to say you aren’t exempt). It might be more visible in the retail sector, given it employs 2.9 million people, but similar numbers of people are employed in the manufacturing sector, the construction sector and almost seven million people are employed in the public sector. In the retail sector it is estimated that customer and colleague theft costs £660 million per annum, and that is despite an average spend per retailer of £6.7 million per annum on crime and loss prevention. Imagine how high those numbers might be in industries where they don't focus on identifying, pursuing and deterring this type of criminal behaviour! In today's economic climate, it isn’t uncommon for my team to see instructions to recover a loss suffered by a client as the result of theft that exceeds £30,000. Your business will have defined processes for dealing with debts owing to you (except the very smallest ones) and this may well include your credit control team pursuing payment and the use of an external company, such as DWF, to provide escalation and legal action if necessary. I imagine it’s safe to say that where the ‘debt’ relates to a loss suffered as the result of theft or fraud, you probably don't have a similar defined process, which means you probably don't look to recover the value that has been stolen from you. Beyond the obvious reason for seeking to recover the value that has been stolen from you (would you let a customer off £1,000 let alone £30,000 without trying to recover it), there are other very good reasons to seek to recover your loss. The most important is the deterrent factor. It is commonly said that there is a 10-80-10 rule in relation to propensity to steal; ten percent never will, ten percent always will and 80 percent might if they thought the chances of getting away with it were great enough, or the reward high enough. You deter the 80 percent who ‘might’ by taking away the potential reward (getting your loss back) and by making it known that you do this. In fact, statistics show when theft is carried out by colleagues, the values are significantly higher than the type of incident we associate with shoplifting Where DWF is instructed to recover loss resulting from theft, it is often also asked to recover monies owed as the result of an overpayment of salary (overpayments due to late notice changes to payroll, excess holidays taken, non-repayment of loans and non-return of property etc.) as well. These can occur during the course of employment or following termination of employment (either in the type of scenario discussed above where you've been the victim of theft, or in the more straightforward situation where an employee leaves). Recovery of these overpayments is not always a simple process, but failure to seek to recover these debts is like throwing money away. This information is intended as a general discussion surrounding the topics covered and is for guidance purposes only. It does not constitute legal advice and should not be regarded as a substitute for taking legal advice. DWF is not responsible for any activity undertaken based on this information. As a CICM member you can receive free legal advice from DWF visit the cicm website and click on the free advice line. The Recognised Standard / www.cicm.com / March 2018 / PAGE 30
www.portfoliocreditcontrol.com PROUD SPONSORS OF CUSTOMER SERVICE HERO OF THE YEAR would like to congratulate all the nominees and winners at the CICM Credit Management Awards 2018 We are proud to be the only, truly specialist credit control recruitment agency in the UK. Solely recruiting for credit controllers and credit professionals, our market knowledge and industry experience has remained steadfast at the forefront of the sector since 2008. Recognised as an award-winning recruiter, we have been placed in The Sunday Times 10 Best Companies to Work For, The Sunday Times Fast Track 100 and the Recruiter Hot 100. We are also an audited and compliant member of the REC. Our unique attributes enable us to fill your next credit control vacancy simply and swiftly. We understand the hard and soft skills of a credit controller and we pride ourselves on finding you the perfect match. All our temporary candidates are fully referenced and come with a first day free trial – so, if you aren’t happy you don’t pay a penny to ensure your full confidence. We have immediately available multi-lingual credit controllers to deliver effective debt management across the globe. Unparalleled market knowledge of our sector with immediately available specialists in the areas of Corporate, Consumer, International, Credit Control and Collections. Give us a call on 020 7650 3199 or email recruitment@portfoliocreditcontrol.com www.portfoliocreditcontrol.com The Recognised Standard / www.cicm.com / March 2018 / PAGE 31
Page 1 and 2: CREDIT MANAGEMENT THE CICM MAGAZINE
Page 3 and 4: MARCH 2018 www.cicm.com CONTENTS 32
Page 5 and 6: For more information call 01206 322
Page 7 and 8: First supplier member joins CSA Sty
Page 9 and 10: BoE warns of new threat to SMEs SME
Page 11 and 12: INSOLVENCY The special manager The
Page 13 and 14: OPINION John Ricketts considers the
Page 15 and 16: MAKE YOUR CASE MODERN collection ag
Page 17 and 18: ADVERTORIAL Are you Risk Ready? Tom
Page 19 and 20: Continual improvement at the Credit
Page 21 and 22: LEGAL MATTERS AUTHOR - Peter Walker
Page 23 and 24: It became clear that Labour was goi
Page 25 and 26: The Real Alternative for High Court
Page 27 and 28: One MP has tabled a private members
Page 29: In uncertain times... it’sgood to
Page 33 and 34: COUNTRY FOCUS AUTHOR - Adam Bernste
Page 35 and 36: Supplement special The CICM British
Page 37 and 38: Recognising the best in credit mana
Page 40 and 41: The CICM British Credit Awards 2018
Page 50 and 51: The Recognised Standard / www.cicm.
Page 52 and 53: CREDIT TO THE EXPERTS SHARING SUCCE
Page 54 and 55: INTERNATIONAL TRADE Monthly round-u
Page 56 and 57: Membership Benefits CICM membership
Page 58 and 59: LET’S DO CREDIT WEEK! Here’s ho
Page 60 and 61: PAYMENT TRENDS Spinning Around The
Page 62 and 63: EDUCATION COMING SOON CICM qualific
Page 64 and 65: How is Brexit likely to impact your
Page 66 and 67: MEET THE PARTNERS THEY'RE WAITING T
Page 68 and 69: HR MATTERS Take it or leave it Gare
Page 70 and 71: New CICM members The Institute welc
Page 72 and 73: OPINION Preparing for success The f
Page 74 and 75: FORTHCOMING EVENTS Full list of eve
Page 76 and 77: TAKE CONTROL OF YOUR CREDIT CAREER
Page 78 and 79: Paladin Commercial would like to co
Page 80 and 81:
Cr£ditWho? CICM Directory of Servi
Page 82 and 83:
Cr£ditWho? CICM Directory of Servi
Page 84:
Winners Choose Rimilia! Rimilia at
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