Preventing Embezzlement In Your Dental Practice

Preventing Embezzlement in Your Dental Practice!
Monetta Reyes, Patterson Dental, Territory Representative

Here are the ” how to’s ” for prevention in your dental practice.

As you review the detailed information…remember, it is never to late to start forming a habit. Not because you do not trust others. It is simply good business to have checks and balances in place.

Investigate every employee with a background check before hiring and ask for appropriate information on the employment application. Be sure to ask is the potential employee has ever been convicted of a felony.

Contact all references including prior employers.

Set a precedent from the top, in outlining job descriptions for every team member, which include checks and balances on a daily, weekly and monthly basis.

Define user passwords on practice management software programs for all team members with appropriate security levels. Find out if your practice management software has fraud prevention alerts with the ability to completely prevent fraud.

Review day sheets from software programs daily to make sure all patients are entered with treatment performed.

Balance deposits daily.

As owner, make your own deposits at the bank, do not allow others to make the deposits.

Periodically review the work of every employee, especially those serving in a bookkeeping function, including accountants and consultants.

Insist that all employees take vacations as outlined in the employee manual.

Review collection records weekly and accounts receivables balances once a month.

Mandate in the employee manual that the doctor must approve all write-offs over $100.

Compare write-offs with cash receipts monthly.

Stamp “FOR DEPOSIT ONLY” on all patient checks received.

Conduct audits at irregular intervals on…


Accounts Receivable

Day Sheets

Reconciliation of Deposits

Inform all employees that these audit are done to discourage embezzlement.

Review audit trails which identify each user on the software programs, weekly, to identify all changes and deletions on patient records.

For petty cash fund, have only $50-$100 on hand and keep a register in a locked cash drawer.

Hire a consultant/accountant to review financial records. Experts can determine areas of weakness.

Indicatiors of a Potential Embezzler

As you look for signs of possible embezzlement, learn to spot the ten RED FLAGS!

Be suspicious of an employee who…..

1. Does not want anyone else to do the job and / or doesnt want to cross train others to do the work.

2. Holds daily work over to post the next day.

3. Prefers to be unsupervised.

4. Works after hours or takes work home.

5. Does not want to take a vacation.

6. Points a finger at other team members as well as bullies and or fires those who are threating.

7. Has no explanations for mistakes made.

8. Ask the business owner to sign checks while seeing patients.

9. Maintains a lifestyle beyond what might be expected.

10. Incurs unexplainable expenses for the business.