The Challenge
A bar and restaurant chain contacted EPIC for help conducting a comprehensive investigation to determine the source of their highest shrink location. One of their restaurants in a high-risk market had recently experienced substantial losses with more than $20,000 in missing liquor and more than $1,000 in missing cash. Existing on-site physical security measures included two security cameras – one at the front door of the building, and the other at the back door. With the limited pre-existing physical security tools at their disposal, the company was unable to determine the source of the losses.
SUBSTANIAL LOSSES
$20,000+
MISSING LIQUOR
$1,000+
MISSING CASH
Our Strategy
- Conduct a high-level shrink analysis to identify the highest shrink items (liquor types, food, comps, etc.)
- Perform a shrink root cause analysis to determine the source of the losses
- Conduct a comprehensive undercover investigation
- Complete Certified Forensic Interviews (CFI) with all location employees
- Assist with the prosecution and subsequent termination of employees identified through the investigation as being involved with any criminal activity
- Review results with the company’s corporate management team to assist them with establishing better policies and practices going forward
The Investigation
Our investigation was a multiple-day operation designed to identify the source of the significant financial losses. Covert surveillance was conducted from inside the location by a team of investigators. During the surveillance, several company policy infractions were observed, which included bartenders free-pouring drinks without ringing them through the register, lack of management presence in the bar and dining area, multiple employees consuming alcohol during their scheduled work shifts, and servers stealing customers’ cash payments.
After conducting covert surveillance, EPIC coordinated with the client to meet with the location’s local management to obtain additional in-depth background information about the restaurant and its employees. EPIC conducted comprehensive interviews with every employee at the location. Insights uncovered by the EPIC Certified Forensic Interviewer (CFI) team throughout the interviews included policy violations that employees admitted to having committed, policy violations that employees had observed others committing, and rumors that employees had heard regarding unethical behavior. The employees who EPIC had observed committing offenses during the covert surveillance phase admitted their wrongdoings and provided written statements to EPIC detailing their personal involvement in the various identified theft activities.
After our assessment and investigation the market as a whole reduced their waste by 8% and increased operating compliance in restaurants by 63%.
The Solution
Following the conclusion of the investigation and comprehensive interviews, EPIC partnered with local management and provided recommendations regarding gaps that were identified in the company’s policies and procedures. EPIC provided all evidence uncovered throughout the investigation to the company’s management team so they could use it toward criminal prosecution and accountability measures for all involved employees.
EPIC facilitated a meeting with all employees at the location to establish expectations. As a result of our comprehensive shrink root cause analysis and thorough investigative approach, the company terminated several employees who we identified as having stolen goods and cash from the company, and also established numerous new policies and procedures to ensure that the location began operating with a higher level of integrity in order to maximize its profitability going forward.
