Balancing the Books

By Paul Streitz

I was visiting a client in Detroit one afternoon when I got a call that no small-business owner wants to get. It was from Cindy, my receptionist. “Oh, my God, everybody’s going crazy,” she said, her voice rising. “Everybody’s paychecks are bouncing. They’re all walking off the job.” For a moment, I felt like I was high on drugs; I couldn’t make any sense out of what she was saying. I managed to stammer, “What? You’re kidding, right?” She blurted, “No, everybody’s leaving!” I felt dizzy. I knew we had plenty of cash because I had just checked our balance prior to my trip. I hung up with Cindy, apologized to my client, cut my trip short, and took the next flight home.

On the plane back, the panic welling up in my chest made for a very unpleasant ride. Since banks don’t usually make huge mistakes, I figured I must have screwed up but had no idea how. I also felt bad for my employees because many of them were living paycheck to paycheck. At the same time, I couldn’t believe that people I had known and trusted for years would walk out on me without giving me the benefit of the doubt. I was as hurt as I was confused. Even worse, I felt utterly alone, a feeling I’m sure other small-business owners can relate to.

It was a sleepless night. When I got to work the next morning, there were enough cars in the parking lot to tell me that it was business as usual. I walked in, bracing myself for a barrage of questions; the last thing I expected to see was that everything would look so normal. But there was Cindy, answering the phones and Susan, the bookkeeper I had hired six months before, working quietly at her desk.

I looked at Cindy and said, “So . . . what’s going on?” She looked at me, shrugged, and said, “I don’t know,” as innocently as she could. I glanced at Susan and got the same puzzled look back. I turned around, walked out the front door, and went straight to the bank, only to find out that no one’s paycheck had bounced. What happened was that one of my employees had tried cashing her check there and, since our corporate account was also there, she was told there weren’t enough funds to cash the check. But everybody else’s check got cashed because the other employees who banked there had gotten there first. She came back to work and told everyone, “I can’t believe it, my check didn’t cash!” which, of course, got everybody up in arms. She was the only no-show that morning because her boyfriend told her I must be a crook and ordered her to stay home. When I got back from the bank, I called her and said, “Listen, there are funds in the account and you can cash your check. I’m sorry for the one-day delay, but something went wrong and I’m going to get to the bottom of it.”

That night, after Susan went home, I sat at the computer and pored over the last three months’ worth of books. All the checks looked legit, but after an hour or so I noticed that we had paid the phone company twice the previous month. The electric bill too. Bingo. I scrolled back and saw that the same thing had happened the month before and the month before that. I flagged those check numbers and kept searching, although I didn’t really know what I was looking for. Whenever a vendor payment caught my eye for some reason, I flagged it. If an unfamiliar payee name jumped out at me, I added it to the list. By the time I finally switched off the computer, it was past midnight. I was so antsy, I hardly slept again that night. I was sure I was getting ripped off but I didn’t have any proof. That would have to wait until the morning.

Instead of going into work the next day, I went straight to the bank. I gave my banker the list of suspect check numbers and waited while he looked them up and collected them for me. Back at the office, I compared the payees on the actual checks to the vendor names that had been entered on the computer. Yep, most of the checks were made out to different entities. It didn’t take a brain surgeon to figure out that Susan had been using company funds to pay her personal bills. The largest bogus check each month—around $700—was made out to a company name I didn’t recognize. I looked up their phone number and gave them a call. Turns out it was a timeshare in Mexico. When I said I was calling from Advanced Lighting, the guy who answered the phone assumed I was Susan’s husband and said, “Oh, yes, Mr. Adams, we received your last payment from your wife’s employer.” I needn’t have worried the night before about getting to the bottom of this mess. I now had all the proof I needed.

I had to give Susan credit. She was smart. The only reason I caught on to her scheme was because we were going through a lean time and our balance dipped a bit too low. I organized all the fraudulent checks, which added up to about eight grand, and without saying a word to anyone, left on foot for the police station. I sat down with an officer, showed him the evidence, and asked, “What are my options?” He said, “Well, we can go over right now and arrest her. You’ve got solid evidence that she’s forging your name. In cases like this, normally what happens is you won’t ever get restitution, but you’ll get the satisfaction of sending her to jail.” The only satisfaction I wanted was getting my money back so I asked what my other options were. He said, “Well, you can sue her, but if she’s taking money from you, she probably has no money.” I thanked the officer for his help and walked back to work.

I shut the door to my office, sat back, and did some thinking. I knew that Susan had recently gone through a divorce, had a young kid, and was struggling to get by. Stealing from me was inexcusable, but just like it hadn’t done anybody any good to lock up my former girlfriend, Liliana, for accepting government assistance checks while she was working (see the “Loving Liliana” chapter for the full story), carting Susan off to jail wouldn’t fix anything. It would only set her back even further and deprive her child of a mother. So I decided to give Susan a chance to do the right thing and get her life back on track.

The next morning, I called Susan into my office. She sat down across from me and a colleague who had agreed to serve as a witness. I handed her a letter and asked her to read it. As she did, her eyes grew wide and her breathing got shallow. The letter was actually an agreement, written from her perspective, that stated that she admitted to and accepted full responsibility for embezzling more than $8,000. Every forged check was listed. The agreement called for her to pay me $200 every week until the stolen amount was paid in full. When she finished reading it, she was on the verge of tears. I told her, “Either sign this letter or I pick up the phone and call the police, in which case you’ll be prosecuted for a felony and probably go to jail.” Trying to keep herself together, she flirtatiously said, “Isn’t there some other way we can work this out?” I looked at her sternly and shook my head. Still looking hopeful, she said, “So, I’m not fired?” I said, “Oh, no. You’re fired.” She said, “Well, how am I going to pay you if I don’t have a job?” I said, “You know what? That’s not my problem. You stole from me and created a huge problem that forced me to come back early from a business trip and disappoint my customer. Your scheme cost me way more than what the checks added up to. I had to pay cancellation charges on my hotel and car rental, not to mention the bad morale you caused here and the stress and worry you caused me. I suggest you sit down with your family and find a way to make these payments.”

Before handing her a pen, I said, “If there are any bad checks I missed, you better tell me right now. Because if I find even one more, this agreement is null and void and I’m going straight to the police.” She looked over the list one more time and assured me that every forged check was accounted for. I also insisted that she personally come to my office every week and hand me a cashier’s check or money order. That wasn’t for my benefit, because, trust me, I didn’t care to see her. I figured that delivering each check in person would remind her of the harm she had done. I also wanted her to see us grow and thrive as a company to drive home the point that unethical behavior comes at a steep cost.

Before concluding the meeting, I made Susan a promise and asked for one in return. I said, “As long as you fulfill your obligation, you have my word that I will not tell anyone outside of this company why you left. Furthermore, you’re not to say a bad word about me either.” She agreed, signed the agreement, went back to her desk to gather her things, and left.

I immediately called a team meeting to let everyone know what had happened. We had such a small company and lived in such a small town that I knew the word would get out and I wanted it handled the right way. I told everyone, “Look, I can’t force you to say or not say anything, but the best thing to do is to keep this quiet, not only out of respect for Susan as a human being, but because we need her to find employment so she can pay us back.”

I also called the meeting because there was much more at stake than the $8,000 that Susan had stolen. After the near-mutiny that Cindy had described to me over the phone, I knew I needed to shore up the relationship I had with my employees. I told them I had been really hurt that they had considered walking out because one person’s paycheck didn’t cash. When I asked why they had felt that way, they essentially said that I was a big city kind of guy who was always on the go and they didn’t know what was going on. I told them I wasn’t keeping any secrets from them and encouraged them to ask me anything they wanted at any time. I said, “Listen, you guys have been with me for a long time. Have you ever missed a paycheck?” They shook their heads. “Have I ever done anything to make you think you’re not getting a paycheck?” More head shaking. I said, “So why would this time be any different just because I was out of town? When I’m gone on a trip, I trust you guys to do what you’re getting paid to do, and I’m asking you to trust that I’m doing what I’m supposed to do.” I told them that they were the core of the company and that they were always paid before anything or anybody else. I explained that the company was doing well and that the only reason why the check problem happened is because I was taken advantage of, which meant that they were taken advantage of too. I ended the meeting by saying, “In the future, if something comes up, I’d appreciate it if you’d come talk to me before jumping to any conclusions.” From then on, I made it a point to hold monthly employee meetings to keep everyone more informed and engaged. Ultimately, even though their lack of faith in me was disheartening, Susan’s embezzling provided an opportunity for me to get closer to my employees and help us understand each other.

Five days after she was fired, Susan showed up with her first payment. To her credit, she came in like clockwork every week after that. She was never an hour late or a dollar short. From time to time, I’d see her around town. She was working as a waitress at a local café and had a second job too. To my knowledge, she never said a bad word about me in the community. In fact, through the rumor mill, I heard she was telling people that I had a big heart and was a great guy to work for. I kept my end of the bargain too. When anyone asked about her, I said she had done a good job but it just didn’t work out and I wished her the best. Yes, some of her former coworkers couldn’t resist gossiping about her but I think that was kept pretty well in check.

I remember the day of Susan’s final payment. She came in looking very happy and excited. She handed me the cashier’s check and thanked me again for not pressing charges and giving her a chance to make things right. I said, “Susan, I’m proud of you for owning up to your mistakes and taking responsibility.” Before she left, she apologized again for what she had done and I could feel her sincerity. I was glad to see that she had treated this second chance as a wake-up call and had turned her life around. In the end, everybody won: I got my money back, Susan learned a valuable life lesson, and I strengthened my relationship with my employees along the way. 

This story is excerpted from the book, Blue-Collar Buddha: Life-Changing Lessons Learned on the Journey from Flight Attendant to Cancer Survivor to Entrepreneurial Millionaire. Click here to order your copy.


 

As founder and CEO of Advanced Lighting Systems, Inc., a manufacturer of LED and fiber optics used in entertainment and architectural lighting, Paul Streitz established himself as an industry visionary and the go-to-source for high-tech, high-touch creative lighting solutions for everything from the Grammy awards, Broadway shows and major concert tours to unprecedented billboard events for Times Square. Advanced Lighting also provided the technical know-how and lighting products to illuminate the original Declaration of Independence and all its supporting documents at the National Archives in Washington D.C.

After selling his company in 2007, Paul reinvented himself as an author and motivational speaker. His book, Blue-Collar Buddha: Life-Changing Lessons Gained on the Journey from Flight Attendant to Cancer Survivor to Entrepreneurial Millionaire, is rapidly gaining him a following in both the business world and the self-help community.

In Blue-Collar Buddha’s twenty-nine uplifting, heart-centered stories of personal and professional enlightenment, Paul details his improbable rise from working-class roots to founder of an internationally respected lighting company. With refreshing candor, caring, and insight, Paul shares the hard-earned wisdom he gained from overcoming debilitating childhood insecurities, shocking betrayals at work and at home, and two life-changing bouts with cancer. Ultimately, with integrity, ingenuity, and indomitable will, Paul created a rich, fulfilling life and a business worth millions.

Click here to visit Paul’s website.
 

Catalyst is produced by The Shift Network to feature inspiring stories and provide information to help shift consciousness and take practical action. To receive Catalyst twice a month, sign up here.

This article appears in: 2019 Catalyst, Issue 16: Kindness

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