Catch her if you can

Versions of this column have appeared in Pursuit Magazine and Cascade Business Journal. — ed.

Betty has worked for your dentist as long as you remember being a patient. She knows your insurance plan, your kids' names and your Social Security number. But what you don't know is that Betty knows how to steal. She stole to the tune of nearly $1 million in 10 years. Betty is a pink-collar criminal.

Kathleen Daly, Ph.D., professor of criminology and criminal justice at Griffith University in Brisbane, Australia, coined the term "pink-collar crime" in her 1989 article, "Gender and varieties of white-collar crime," in the academic journal, Criminology, to describe the growing number of lower- to mid-level office women — bookkeepers, office managers, accountants, clerks — who steal from their employers. Unfortunately, pink-collar criminals are increasing not only in numbers but also in the amounts they steal.

I spoke with Freda Adler, Ph.D., author of "Sisters in Crime: The Rise of the New Female Criminal." Adler said she had to defend her work for years after the publication of her book in 1975. At the time, many thought she was trying to criticize the ascendant women's movement. She appeared on The Tonight Show with Johnny Carson to defend herself. She also gave more than 300 interviews to newspapers, magazines and television, including one with Barbara Walters.

"Her nuanced statement of this thesis would be reduced by others to the provocative contentions women's liberation causes female crime," wrote the editors of the 2014 Oxford University Press textbook, "Sisters in Crime Revisited: Bringing Gender into Criminology."

Adler argued back then that the criminal justice system wasn't adequately prepared for the future increase in female incarceration, with only 4 percent of the criminal justice budget dedicated to women. She was proven correct as the rate of female incarceration rose. From 1990 to 2010 embezzlement arrests increased 11 percent for women and decreased 12 percent for men, according to the U.S. Department of Justice. See Arrest in the United States, 1990-2010, by Howard N. Snyder, Ph.D., U.S. Department of Justice, page 24.

Adler would scarcely have to defend her thesis in today's environment. So the question turns to what has changed to increase the number of pink-collar criminals? Put simply, more women are in the workplace and have access to funds.

Be it a small business, medical practice, parent teacher association, town government, charter school, volunteer organization or even a kid's athletic club, we're seeing a rise in the number of friendly, "regular-type" women who break their employers' or peers' trust and steal their money.

Managing 'company money'

Women are now the leading or solo breadwinners in 40 percent of American households, compared with just 11 percent in 1960, according to the U.S. Department of Labor statistics. Women are more responsible than ever for bringing home the bacon, and that can equate to increased pressure to earn more.

Pink-collar thefts typically range from a few thousand to the low millions of dollars. And we have to include the incalculable legal, ethical and emotional fallout that accompany these financial and moral breaches of trust. So why are we surprised to see women steal when there are more pink-collar criminals today than ever before?

Prior to the 1970s, few women had oversight of "company money." But that's no longer the case, especially at small- and medium-sized organizations where women are often in middle management — but not necessarily above that level. And that explains the "glass ceiling" in embezzlement. Women on average steal approximately 40 cents to 50 cents per every dollar stolen by a man. Women are now in positions of financial power. But they're still in lower-level positions and generally have more scrutiny than higher ups.

Another hypothesis holds that women only steal to make ends meet and not for grander purposes. However, if this was ever the case, it isn't so today. Women are no more inherently honest than men; they simply haven't traditionally been in the position to carry out large-dollar thefts.

The story of Rita Crundwell is a case in point. The former CFO of Dixon, Illinois (a dependable, long-serving employee), stole an amazing $53 million from the town with an annual budget of only $8 million to $9 million. Crundwell was sentenced to nearly 20 years in prison. [See Comptroller, horse lady and crook: How one woman (allegedly) embezzled $53 million, parts one and two, Fraud Magazine, September/October and November/December 2012 by Henry C. Smith, III, Ph.D., CFE, CMA, CCS; Vincent Alger, Kevin Genter, Nichole Lawhorn, Melissa Lee, CPFO, Heidi Mitchell, Kevin Murphy and Jared White.]

While that story made the front pages, farther back in the paper often are numerous stories of women who get caught stealing from a wide range of small organizations — from the local church to dental offices. (Watch out dentists: Some 35 percent to 60 percent of all practices experience embezzlement — often of the pink-collar variety, according to Protecting Your Dental Office from Fraud & Embezzlement, American Dental Association, and the website of prosperident, a dental embezzlement investigation firm.)

'Normal' women

The fact is that keeping any small- to medium-size organization safe from embezzlement is a challenge. The pink-collar criminal is often the "most trusted," long-term employee in an office who has worked at the same place for many years. And for much of that time she most likely hasn't stolen. These women don't fit society's stereotype of criminals. They are "normal" women from our communities: mothers, breadwinners, churchgoers and volunteers.

What makes them go from law-abiding citizens to criminals? The Fraud Triangle (applicable to both sexes), whose three sides are pressure, opportunity and rationalization, as always, explains many cases. Some people would never rationalize a theft. But if there's financial pressure and the opportunity is present, we have a perfect storm for embezzlement.

Many employers tell me they pay their long-term, trusted employees better-than-average salaries. That's nice, but if the employee spends more than above average, they still might steal. The only thing an employer or supervisor can control is opportunity. The person to seriously watch is the most-trusted employee who never takes a vacation — man or woman. Burnice Geiger stole approximately $2 million (about $16 million in today's dollars) from her father's bank in Sheldon, Iowa, for 37 years until she was caught in 1961.

According to a possibly apocryphal (but unconfirmed) story told by a Sioux City, Iowa, police officer, Geiger was reportedly exhausted by the time she was arrested. Why? Because she never took vacations. (See When to Rob a Bank, by Stephen J. Dubjner, at Freakonomics.)

According to the article, Geiger was sentenced to prison for 15 years, but was released after five years. According to the cop's story as stated in the article, she then worked for a bank regulatory agency where she investigated employees who didn't take vacations.

Rita Crundwell, the former CFO of Dixon, Illinois, was caught when she took 12 weeks of approved unpaid leave in addition to her paid leave. A city employee assumed her duties and found discrepancies in a bank statement. Make sure your employees are taking vacations.

It seems obvious, but supervisors need to be paying attention to their employees' lifestyles. An Oregon boss looked out the window one day and saw his assistant driving a Cadillac Escalade. That same employee was known to keep horses as a hobby. Eventually, but painfully late, it dawned on the boss to take a look at his books. His trusted woman colleague had stolen more than $800,000. (See Milligan pleads guilty to embezzlement, by A.K. Dugan, Lebanon Express, May 30, 2012.)

Many have said that men steal for the three Ws: wine, women and wagers. Now some say that women steal for the three Cs: cars, clothing and casinos. A dentist told me he should've known something was awry when he noticed his office manager's Lexus was newer than his.

Can't buy back trust

Finally, perhaps the worst aspects of these cases are the feelings of hurt, betrayal and broken trust that linger long after the crimes are resolved. Pink-collar criminals, many of whom were part of office families, can destroy victims' trust in all employees. (A doctor's wife told me she always referred to his office manager as the "second wife" because she closely knew his patterns and habits.)

Most of the victims I know never saw this coming — a loss of the joy and camaraderie of running a small organization. The money can always be replaced. These victims were successful in the first place and will continue to be successful. However, you can't buy back trust.

Pink-collar criminals are often the "nice ones" in the office. They're nice for a reason. They might be stealing.

Kelly Paxton, CFE, PI, SMIA, is a licensed private investigator and social media intelligence analyst. She's a frequent speaker on fraud and pink-collar crime. She owns the website pinkcollarcrime.com. Her email address is: kellypaxton503@gmail.com.