The Shift Manager of the fast food restaurant was sitting in his car, under the shade of a tree in a parking lot. On the floorboard are unused disposable deposit bags and a destroyed deposit bag that had been sealed with the previous night’s closing deposit. The manager had cut the deposit bag and read the passenger seat with the contents: units, five, ten, twenty and change. He will use one of the unused bags to make a new deposit. The manager counted the funds several times, his stress level rising. The amount is not enough to match a deposit slip for a deposit dated two days ago. Two days ago? What’s going on here? Why did you open a deposit bag today to match the funds with a deposit ticket that is two days old? Know?

This is a theft scheme called “rolling deposits” and sadly it’s not uncommon when store and restaurant managers prepare deposits and make deposits at the bank. The employee steals all or part of the day’s deposit and offsets the stolen cash against the contents of future deposits to cover the thefts. The scheme continues as long as the administrator has access to the repositories.

The telltale sign of the “mobile deposit” robbery scam is that deposits brought to the bank by a particular servicer are routinely validated by the bank several days after they are due. Deposits taken to the bank by the other administrators are validated on time. The stress level of the scheming manager increases as the need to match deposit funds with non-validated deposit slips becomes more and more complicated. As in the previous example, the deposit opened by the administrator is not enough to cover the previous deposit ticket. The manager will now have to wait to add funds to the deposit tomorrow to hide the theft from him.

If the business is using disposable deposit bags and the deposit was prepared by another manager, our manager on duty involved in the theft scheme makes the bank run with the deposit. As in the previous scenario, the manager on duty to continue his thefts, must open the sealed deposit bag and remove the cash and accompanying deposit slip.

Without intervention, these theft schemes can go undetected for a long time and the cash losses can be staggering. Experienced security and loss prevention professionals can easily reveal fraud with a little investigation. In my experience, the manager running mobile deposit fraud will readily confess when properly interviewed. They’re so stressed trying to keep the scheme afloat that they’re usually relieved it’s over.

There are tried and true protocols for establishing strong loss control practices to prevent this type of scheme and ways to easily discover it. If you suspect that one of your employees has mobile deposits:

1. Develop a chart: At the top of the chart, list these columns: Date, Shift (Deposit), Deposit Amount, Bag Number, Depositor Name, Bank Verification Date. Make a separate line for each deposit. On the left side of the graph, list the sequential days of the month. Fill in the relevant information as of the first day of the month.

2. Analyze the chart: look for patterns and discrepancies, such as missing disposable bag numbers in the sequence, bag number “skips,” and bank deposit validations. Look for a pattern where the same manager takes deposits to the bank when discrepancies occur.

3. Action – Prohibit the suspect’s access to the warehouses. If a revolving depot scheme is taking place, a depot will soon show excessive shortages or be missing altogether. Track deposit activity for the past few months to get a better indication of when discrepancies first appeared.

4. Prevention

* Require all deposits to be sealed in disposable deposit bags

* Eliminate vinyl/canvas/zipper bags

* Register deposit bag number with the corresponding deposit

* Require depositors to sign deposits they take to the bank

* Check all bank deposit validation dates with business dates

* Develop robust cash and deposit audit programs for deposit bags and out-of-sequence validations.

*Have a bank representative notify you of “late” deposits (>3 days late)

* Consider SMART safes or armored car service

Taking bank deposits is a common practice for QSR and restaurant management. It’s plagued with issues like time away from administrative responsibilities at the restaurant or store, exposure to traffic accidents and crime, and this “mobile deposit” theft scheme. Although it appears to be the cheapest way to send funds to the bank, it can be more expensive if the manager is seriously injured or killed in a car accident or armed robbery while in transit. Stealing tens of thousands of dollars from deposits may pale in comparison. As new technology develops, armored car service becomes more competitive, and forms of banking become more progressive, it may be time to rethink how we get our money to the bank and eliminate exposure to our people and our profits. So what is going on here? Why do certain deposits arrive at the bank several days late?

Now you know, and now you can do something about it.