09/24/2026
One of our dispensary clients recently caught an employee stealing. Management noticed that one employee was giving out an unusually high number of discounts, so they decided to test what was happening. They had a friend go into the store as a secret shopper. The friend placed an order, paid full price in cash, and left. After the customer walked away, the employee applied a 10% discount to the transaction and pocketed the difference.
The POS showed the discounted sales price, the correct product came out of inventory, and the cash drawer contained exactly what the POS said it should contain. If management had only been looking at cash and inventory reconciliations, they may never have found it.
In our latest article, I use this story to explain why traditional internal controls and segregation of duties are so important in cash-intensive businesses, but also why they can only go so far. We look at the Fraud Triangle, how collusion can defeat otherwise strong controls, and why simply having good systems in place does not necessarily prevent employee theft.
More importantly, we discuss the concept of the perception of detection, and why making employees believe that unusual activity will be noticed and investigated may be one of the most effective ways to prevent fraud before it happens.
If you own or manage a dispensary, I think there are some important lessons here about how to think about employee theft and fraud prevention beyond simply making sure your cash and inventory balance.
