-
-
Online Tutorials
Dentist office embezzlement is a major issue at dental practices, but most dentists don't even realize how widespread the problem of dental embezzlement is.
I'm a total cynic when it comes to dentists being embezzled. I've spent over 20 years uncovering over 100 thefts. I'm fully convinced that it happens all the time. (In fact, one of my surveys found that most dentists report being embezzled.)
The vast majority of embezzlement cases never go to trial. (And we're not even talking about all the theft that is never even uncovered in the first place!) Usually, the offender is fired, and that's it. If charges are filed, 9 out 10 times there will be a plea bargain which results in probation for a first-time offender.
Only on rare occasions do you see the dental embezzler fully prosecuted and taken through the court system. This only happens if the case has has been fully investigated, all the details uncovered, and everything tied up with a big bow by the doctor (and the the doctor’s attorney and private investigator) and handed to the district attorney for prosecution.
Recently, one such case resulted in a five-year prison sentence for the miscreant. The 25-year-old woman, a Texas dentist's financial clerk, pleaded guilty. Here's the news report:
U.S. District Judge Hilda Tagle… sentenced [defendant Claire Batsell] to 69 months in federal prison on a count of fraudulent use of dental patient identification information and a count of aggravated identity theft.
The U.S. Attorney’s Office said Batsell used patient information to open and bill credit card accounts for services. In addition, she pocketed cash payments made by the patients…
Dentist DavidPedley was unaware of Batsell’s scheme and said her actions almost destroyed his practice and damaged his reputation…
In a statement before Tagle, Pedley said the thefts affected the credit of some of his patients and "imposed a huge financial burden on him and his family to pay back the credit card company for the fraudulent charges made by Batsell."
- Laura B. Martinez, The Brownsville Herald
While it's morally satisfying to see someone held accountable for their wrongdoing, I have to say: if it was just the doctor losing money, this case probably wouldn't have been prosecuted. Identity theft is a hot consumer issue right now… while employees stealing from their dentist employer is somehow stale and commonplace.
View all our stories about dental practice embezzlement
Post a comment
January 20th, 2010 at 5:06 am
Thieves are rarely prosecuted and when they are, sentencing tends to be light (compared to other similar crimes)
I attended court yesterday to watch a former office manager who siphoned approx $5,000 a month for over 6 years from the practice recieve a conditional sentence. She walked out of the courtroom.
Embezzlements against dentists are very common and from y experience, even higher than churches and not-for-profits (which are rated the worst)
Bill
http://www.prosperident.com
January 20th, 2010 at 8:17 am
Employee theft goes undetected because checks and balances of financial processes are weak. Dentists, or any other owner/manager, has the difficult position of being hands on (no pun intended) while trying to manage the business.
Paying attention to the the financial viability of their practice may be mistakenly handed to their CPA. Unless that CPA is handling all of the bookkeeping functions of the office they are ill equipped or trained to detect fraud.
Financial functions of the office require the scrutiny that a working manager just does not have therefore they must have smaller “interventions” of the most theft prone areas through regular review. Catching problems early will be difficult because the amounts are usually small. Over time the schemes are cumulative and begin to raise flags.
Pat Murphy
LPT Security Consulting
January 20th, 2010 at 10:45 am
I echo that embezzlement is common place in dental practices.
My first front office worker stole for 10 years until she was caught. She found me right after I graduated in the mid 70’s, got hired and set up her scheme. The investigation proved that she started stealing within two months of her employment. This occurred in the days of peg board accounting systems. Her method involved lost?/duplicate accounting cards and a fair amount of “white out” to make the sheets balance. Another trick was to make side arrangements with Spanish speaking only patients for discounts and report back to me that they were uncollectible or have moved out of town. She was bilingual herself but I had limited Spanish skills.
The damage that occurred to my practice was severe in terms of money/patient loss. The first criminal Court judge was going to send her to jail and she rose up in Court, approached the bench with her attorney and fired him. She was reassigned a new judge and got another attorney. She was eventually prosecuted and convicted in this case but was able to get straight probation because the judge ruled it was a first time offense. I blurted out in Court that she had been doing it for ten years so it shouldn’t be considered a first time offense. I was almost held in Contempt of Court for my outburst. At that point it was the DA’s case, not mine. The Court ordered that the amount of restitution was to be determined in civil court which required me to get a civil attorney and file a civil action. I did just that and got awarded a monetary judgement for what I could prove for the last three years. In California there is a three (or four?) year statue of limitations so she essentially got away with the early monies. I put a lien on her very nice home but she refinanced with Country Wide and my lien was wiped clean. That was another legal battle that I lost. In the end she made two very small payments and then declared bankruptcy which wiped out my civil judgement. This would not have been possible had the criminal Court ordered the restitution in the criminal case. In the end, I felt that I was victimized both by the Court process and by the employee. I could give a seminar on this subject from my experiences! I will be working longer than I expected in my career from this loss but at least I have a job and enjoy what I do.
January 20th, 2010 at 12:53 pm
Does anyone have any suggestions on how to monitor our office so that we can find out if someone is stealing?
January 20th, 2010 at 2:01 pm
I found out an employee was embezzeling from me while taking my son home from the hospital for brain tumor surgery. She was embezzeling while my 9 year old was in intensive care. The people who set-up my Dentrix software helped make it easy since none of the security systems were activated. Of course Schein took no responcibility and said it was a training issue. Police reports were filed but since no password was needed to delete the cash transactions there was insufficient evidence to bring her to trial.(although it seemed obvious to me) Double check your computer system and make sure you have “employee dishonesty” coverage on your business insurance.
January 20th, 2010 at 3:32 pm
It is scary to know how common this is. What can I do, as the doctor’s wife and part time office manager, to spot and prevent this?
January 21st, 2010 at 3:55 pm
The responsiblity lies with the owner/provider of the practice. I have worked in the dental field for 30 years and was also a certifed trainer for Dentrix up until a couple of years ago. Software trainers are not “consultants” when they come in to initial training on your software, they can only make recommendations. Passwords should be implemented and audit trails run as well as daily checks and balances. Employees should be bonded as well. In fact, Dental Town had an excellent article on embezzlement in their December issue.
January 25th, 2010 at 12:05 am
In addition to being embezzled by employees, dentists are often deceived and misled by unscrupulous marketers trying to sell them “get rich quick” schemes; sometimes even by one of their own.
A particular Dental Town Scam comes to mind.
jb
March 2nd, 2010 at 8:46 am
Connundrum – weighing your time spent in reviewing daily accounting matters against time spent conveying client services and/or your disbelief that a trusted employee could be stealing from you and every day look you straight in the face with a smile.
Deal with it! Or face the inevitable consequences. When I say “deal with it” – you have a number of alternatives. Ask questions until you get the answer that best suits your situation.