Ethical dilemma - should I leave or tolerate

[PriyaPT]

The dilemma: I’m no.3 in a tiny finance team at my employer, and I’ve become aware that there’s low-level fraud of company expenses throughout the management team. I noticed because I was covering review of expense claims while someone was off sick.

I raised it with my two senior managers (one is the FD) and the HR director but it’s a small “family feel” company (< 250 employees) and they have just got used to spending the extra £100 here or there on expenses. Nearly all the managers do it, one person even seems to have booked a cheap holiday and charged the company! The FD is lovely but weak and feels we should treat people well and we get it back in effort and staff loyalty.

I’m in my 50s and have lots of experience; I don’t “need” this job. I took the job because it seemed like a nice atmosphere and not too challenging. I’m menopausal and not thick skinned any more. I just don’t need drama. I feel uncomfortable with the expenses situation - it’s fraud, and I’m a professional with integrity. Also - The company was recently purchased by a huge foreign company who largely ignores us, but would NOT approve of the situation if they found out. That somewhat scares me.

I do not want to whistleblow (we don’t have proper global internal controls and no safe place to whistleblow to) over something that is relatively trivial - the UK people would hate me and I’d probably feel I have to leave anyway. If they had to justify and repay expenses it would be really unpleasant.

If i stay silent and it comes to light later, it could cause a stink, and I could definitely be blamed for it (it would be extremely hard to say I didn’t know, and that would be a lie).

Our auditor, by the way, is a personal friend of the FD and doesn’t audit anything properly.

So, do I leave and say it’s just not the role I hoped it would be, or blame the menopause? Or do I take a chance that the I can influence the policies positively once I’m more embedded in my role?

There is nothing I especially love about this job and I’d only stay to finish a project I’m working on.

I would leave, absolutely no question about it. You don't need the job and you would be exposed if it was ever investigated. I would just say your circumstances have changed and you are going to explore other avenues, or something like that. A bit off topic, but I wouldn't blame the menopause

It’s fraud!!
it’s stealing - I cannot believe the FD is happy with that
I would not hesitate to report to appropriate bodies and as you aware you don’t want to be implicated in anyway
and yes, if quit and make it quite clear as to why and don’t blame menopause
how horrible for you

The FD is not lovely
and treating people well doesn’t include letting them steal
make sure you have a timeline of you flagging it and being ignored

I would leave citing your discomfort with fraud within the company, and that you don't wish to compromise your professional integrity by remaining there.

I would have a quiet word with whoever is most likely to listen then leave saying something like you are not enjoying the job. You don’t need the hassle and don’t want to appear complicit when this fraud is discovered.

Or do I take a chance that the I can influence the policies positively once I’m more embedded in my role?

Absolutely not. The corruption is part of the company culture, they're basically all at it. You will not be able to change this, and you likely will get blamed.

What did the FD and HR director say when you raised it with them?

I would leave and make sure your resignation letter references concerns that you raised with the FD and HR director, so you have an audit trail for later.

Acting with professionalism and integrity is never wrong. Get it in writing that you’re not going along with it. This has the potential to destroy your credibility and reputation.

I would email my concerns to the MD, FD & HR pointing out all your concerns, I'd do a SARS report to HMRC (maybe not all at the same time so they didn't connect it to me) and then I'd get on with my day. I wouldn't leave.

I think I would raise my concerns in writing, and then if nothing changes I would have to leave.

My husband was in a similar position- uncovered fraud... claiming for OT not worked, taking additional annual leave- clocking each other in/out.
He reported....fraud dept wasn't bothered as it wasn't huge amounts on an individual basis but extrapolated out it was thousands.
He was hounded out. Lies made up about him- the whole 'team' of those involved took it in turns to accuse him of stuff- he had multiple complaints at one time. All disproved but very stressful.
It broke him. He'd never do it again - he'd leave first.

This exactly. For context my dh runs a small company so I have some idea how these things work. I would leave and say why.

Been in exactly your position before but towards the start of my career - I left as soon as I could!

Another vote for leave.

There is a third way, to continue to pay people's extra expenses and pay the tax on that, but you'd have to get that agreed by your huge foreign owners and that could be tricky. Also the tax will be an expensive PITA.

So I'd say leave. Explain why.

Act with integrity but please put in writing the reason you are leaving because when the fraud becomes apparent (and it will) and the police knock on your door you are complicit if you don't speak up. If you fly with the crows....... Always do the right thing !

I would leave because I would not want to be involved in covering up fraud.

The company could end up with their taxes/accounts under scrutiny one day by HMRC or by the company's board/investors and all this could come out and you might end up being caught up in an investigation.

I would not want to be associated with a company like that.

There is no chance that you would be accepted even if you are believed. You have to resign and disconnect.
I would want to carefully consider a factual report to the auditor. That would cover you if there ever were to be charges. Needs think through.

I would leave. I would also put in writing exactly why I was leaving and I would also inform the auditor in writing. I wouldn't be risking any chance of being professionally tainted by this, it's stealing.

@PriyaPT

In your position I'd leave.

I'd put it in writing to the FD why & say I'm not comfortable about their position on this.

id copy in the Auditor friend. & get written acknowledgement from both.

id tell absolutely everyone else, it just wasn't the role I had thought it would be. Do not mention menopause. For 2 reasons 1. Do not make this about you in any way. 2. If women start to blame menopause for everything it does nothing to help understanding when it IS the reason.

i wouldn't take it further with anyone. It's small fry, no one important will be interested & it will only bring hassle to your life.

then try to forget about it.

Many years ago as a junior accountant, I worked (overseas) for one of the Big 4, Infound myself in a very similar position. It seemed like my Manager didn't 'approve' but didn't feel able to challenge it as all the Partners were equally involved, my Manager was near retirement & didn't want to rock the boat, nor anyone else with families etc. I felt too young & inexperienced in Corporate to do anything about it, so I just resigned. It was not good for my career path, but I couldn't condone it.

@PriyaPT this will only snowball into something bigger down the line.

Send emails again to every director and HR and bcc in your own personal email so you have proof. Then send emails to the parent company and explain that you feel due to the ongoing fraud, you feel you have no choice but to leave your role as you do not wish to be associated with criminal activity and bcc yourself in again.

Then go. When this eventually blows up and they come knocking on your door to blame you, you will have proof you not only reported the fraud, you were also forced out of your role because of it.

Don't stay and try to fix this. If they're stealing now, they've been stealing all along and it will catch up to them.

Thanks everyone, for the unanimous “don’t ignore this”.

I do not think they are ever claiming VAT on these expenses, so that’s something at least. But obviously if we are paying someone’s netflix subscription on a monthly basis (and yes - we are) then that’s a Benefit in kind and should be taxed. So there’s that issue. Argh.

I actually feel a bit tearful about it and honestly they need me - I’ve been slowly trying to fix little fires burning everywhere and Ive been making progress.

They would beg me to stay, so I’d probably need to at least tell the FD why.

@Paganpentacle what a terrible experience I’m so sorry for your dh. I hope he found somewhere better to work.

Also point well taken about blaming the menopause. It is contributing to why I don’t feel strong no enough to cope with the situation at work (I feel more anxious, scatty and less confident). But on its own it is not enough for me to want to leave, and I don’t want to do Womankind a disservice by blaming health issues unduly.

I would have one more direct conversation with the FD and HR together (ideally recorded, or followed by a summary email):

-flagging the problem you observed while on cover with examples
-stating you are uncomfortable with the lack of response and at risk of leaving
-being very clear that the company culture of making life easy for employees needs firming into an explicit and transparent policy about allowed/not allowed expenses.
-that you see this task as the FD's role

Line up previous employers as referees and then get out of there.

I work in finance and this would really concern me. Are you registered with a professional body (e.g. AAT / ACCA etc) that you could talk to? If so, I'd take all of their recommendations. Otherwise, yes I would leave. The auditor should really be reported too - familiarity threats when auditing are a huge issue

@WorldMap24 My registration lapsed as it was an unnecessary expense in Covid lockdown when I was out of work. No employer has ever asked for it, weirdly.

The situation with the (small) auditor really appalled me when I joined, I’ve never seen anything so cosy in my whole career. It was my first alarm bell. The auditor seems to take the view that it’s a small business and who is he to get in the way - nothing is material by amount. A nice lunch at the end. It’s like an extreme version of how things used to be 30 years ago.

The FD by the way does not sign the accounts; that is done by someone overseas. Who I don’t know, as too senior. He (probably?) does a walk through of the financial statements with the FD. He signs all sorts of stuff, no questions asked.

I feel a bit dirtied by it all. The culture is top to bottom, I guess (I heard the bigwigs spend lavishly on their expense accounts too, and the UK team frequently comment on that, I guess it helps them feel justified.)

@semideponent i like this idea, it seems moderate and sensible, I have not done anything formally and it’s really bothering me. I need to give them a chance to make it right.