Since 2007 when the nation’s economy began sliding into recession, warning signs started pointing to the kind of thing that happens when unemployment begins to rise. Notably, there has been an increase in “shrinkage” - everything from break-ins to white-collar theft.

Since 2007 when the nation’s economy began sliding into recession, warning signs started pointing to the kind of thing that happens when unemployment begins to rise. Notably, there has been an increase in “shrinkage” - everything from break-ins to white-collar theft.

Our firm was recently hit in two different locations over one weekend. One resulted in some building damage and a few computers missing and the other involved cold hard cash. We have determined that the first was a somewhat amateur job and the second may have involved someone with inside knowledge. Hate to say it, but most business crimes involving cash are perpetrated by insiders.

These incidents were minor compared to events that followed. Over one weekend in Atlanta, roofing distributors were under siege as over 50 trucks of roofing went missing along with the equipment to pull off the job. Shortly after learning about this incident, we received notice from the North Texas Roofing Contractors Association (NTRCA) that they had partnered with Crime Stoppers to offer a $5,000 reward to help end an increasing theft problem in their part of Texas. The association estimates that losses to the industry have topped $2 million so far this year.

Atlanta and North Texas have three things in common. One is the pricing of asphalt shingles, which has risen at record levels for some time now. The second is that these markets are operating at heated levels following considerable storm damage over several seasons. The third component is motive. Unemployment and underemployment have brought the motive component in line with the opportunity to steal.

These thefts damage not only the manufacturers and distributors who are the primary targets but the legitimate roofing contractor and roofing consumers. Individuals putting themselves forward as roofing contractors who are installing stolen property are able to unfairly affect market pricing. While they are at it, they are also committing a crime for which an unwitting homeowner may be called into account for receiving stolen property.

There are a few things legitimate contractors can and should do. You should be prepared to add your distributor to your list of referrals so the homeowner or building owner can call to find out you are a customer in good standing. If you receive a solicitation to purchase shingles from an unknown source at a below-market price, contact the authorities.

Your local police department may offer consultation services for your business. Invite them to come and survey your property and vehicles in order to suggest ways of preventing crimes. Find out what you should do and who you should contact if you are offered “questionable” deals for materials.

Again, I hate to be the one to suggest it, but this may be a good time to bring in your accountant to review all of your policies regarding cash. Do you have sufficient separation of duties to prevent a white-collar theft? The best defense is probably your own street sense. Being aware that you are operating in an environment that is increasingly hostile is a good place to start.

Rick Damato
Editorial Director
rickdamato@yahoo