How to identify pullbacks in sales
O tkats are illegal amounts of money that go to company employees for organizing a trade deal. Most often, kickback schemes are the result of an agreement between the two parties. For example, a sales manager plans to “cut” money with a customer. But it happens that the only recipient of the "fee" is the employee himself: he informs the management that the buyer demands a kickback, gets permission and takes the money for himself, while the client does not even know what is happening.
According to unofficial statistics, the rollback amount reaches an average of 10–20% of the transaction amount. But accounting control reduces the likelihood of successful implementation of such schemes in the company by 7%. Moreover, both the ordinary employees of the company and the management are supposed to monitor the transactions. There are several common rollback patterns and ways to identify them in an organization.
- Unreasonable discounts on products
The essence of the scheme is that a sales manager can provide a regular customer with a discount on goods in the amount of up to 20% of the total amount. The decision to grant a discount is most often made by the employee himself. In practice, the buyer receives a discount or deferred payment, with some of the money going into the employee's pocket. Such a scheme can only be exposed by systematic monitoring of reports and comparison of the prices of goods for different customers.
Each suspicious transaction requires careful study, because a discount could be really necessary, for example, to motivate a large purchase or to get a strategically important client. It is necessary to thoroughly understand all the characteristics of the goods, since the cost may depend on additional parameters, delivery distance, packaging materials, etc. It is worth taking into account changes in the cost of goods in the course of cooperation; price adjustments may be associated, for example, with fluctuations in the dollar exchange rate and other circumstances. Another company manager, management, or accounting department can expose the kickback scheme.
- Illegal winning a tender
For example, a firm that offers a small assortment at inflated prices wins the tender. A typical algorithm for conducting an illegal tender looks like this:
- A company that is interested in goods or services opens a tender.
- Sham firms or organizations created specifically to create false competition are allowed.
- Documents submitted from real companies are rejected based on minor inconsistencies with the stated requirements.
- Information about the tender is, if possible, not disclosed or covered in unpopular local publications.
- One of the participating companies gives a kickback for the choice of its services or goods and, as a result, wins the tender.
In such a situation, the task of the one who is struggling with kickbacks is to find out who organized and how the tender was conducted. It is important to understand whether the applicant firms had the opportunity to learn about the holding and to participate in the competition. It is also necessary to check what conditions the winning company proposed and compare these conditions with the market average. The rationale for picking a winner is questioned when the market offers better terms. Chances are good that this tender was not without kickbacks.
How scammers disguise the receipt of kickbacks
Kickbacks are less and less often transferred in cash. Banking operations with illegal profits are carried out so that no one notices the receipt of funds. But an experienced accountant can still find a clue and unravel the scheme of illegal account replenishment.
Among the most popular ways to get kickbacks are:
- Transfer of the amount directly to the bank card of a company employee, bypassing the work account . It is rather difficult to suspect such a scheme, since the invoice is most often issued by the supplier and to another person. The manager who received the rollback remains undisclosed, and access to the employee's accounts is not provided to the accounting department.
- Getting a kickback as a "friendly help" to the enterprise. For example, employees can open their own company or have relatives-co-founders of the company, to whose account the funds of the company are transferred. There can be any pretext for transferring money, but most often these are consulting services, the implementation of which is difficult to control and verify. Sometimes kickbacks come under the pretext of conducting market research and checking company documentation. The main thing in such a rollback scheme is to come up with an argument that cannot be verified materially.
Sellers can make rollback offers in various forms - the buyer does not have to be told about it directly. Psychological tactics work: the sales manager looks closely at the personality of the buyer and selects a method according to the situation. For example, during the conversation, he mentions that the company is now holding a special promotion - and gives customers a mobile phone, tablet or other valuable item. At the same time, the specialist specifies which version of the gift will suit the client in order to please. As a result, a person leaves with a bonus, but having paid exorbitant prices, and the manager pays off his personal investments and makes a profit in his pocket.
Another approach is to indirectly make it clear to a person that a rollback scheme is possible that is interesting to both parties. Code phrases can be proposals "We are ready to provide a discount especially for you in a convenient form" or "You will definitely receive a small commission from the operation performed . " If the buyer responds positively, the sales manager moves on to discuss the details.
In any case, it takes personal contact and time to test the waters and negotiate a rollback, so the manager's over-helpfulness, too long service, or the desire to hide the details of working with a client should raise suspicion from colleagues and management.
How to understand that an employee is receiving kickbacks
The following signs may indicate that an employee is involved in gray schemes:
- Improving the financial situation and quality of life . If an employee earned an average salary and usually rode the subway, and then suddenly switched to an SUV and significantly increased his expenses, doubts about his honesty are fully justified. It is important to look closely at the employee's actions to make sure their standard of living has not improved through kickbacks.
- Frequent absences of an employee from the office during the work process . This behavior may indicate an unfair performance of duties. But if an employee spends a lot of time with a product supplier or with a customer, then the likelihood of collusion increases dramatically.
- Registration of suspicious documents for the sale or purchase of goods. Every company has its own rules. For example, all documents must be printed on letterhead with company coordinates and other identifying marks. All receipts and consignment notes must have the same appearance and follow the pattern for the entire period of cooperation, and more. Failure by employees to follow these rules can hide gray patterns. For a seasoned accountant, this can be a clue to uncover a rollback.
You need to understand that these signs are indirect, but if there are no logical explanations for them, then it makes sense to observe the employee. In order for a rollback to be identified, both the suspect's colleagues and management must be involved in the investigation. In the future, the case can be sent to the courts under articles related to fraud, tax evasion and material damage to the organization.
How to prevent the practice of kickback schemes in the company
You can resort to a monthly lie detector survey of employees. But such checks are mandatory for everyone, and not selectively. You can ask questions about the benefits of making deals and getting kickbacks. The method is effective, but it is necessary to warn in advance about its presence in the company, during hiring, and also to obtain the employee's consent for a polygraph test.
The processes of selling goods or services should not be tied to one specialist. The more employees are involved in the process, the more difficult it is to pull off an illegal transaction, because at certain stages of negotiations on purchases or sales, new people appear. If the staff of the company allows, you can also select a specialist who will oversee the procurement or sales processes. This approach simplifies the investigation process and allows you to more effectively expose kickback schemes.
Additionally, you can implement electronic documentation and reporting, which will immediately calculate inaccuracies and errors in the sale and purchase processes. You can also organize your documentation and speed up its review and approval processes.
Benefits of working without kickbacks
Unfortunately, in the domestic market, roll-back schemes have become a kind of sales tool that many companies continue to use by inertia. They take risks, but they use corrupt practices and kickbacks to drive sales. The problem is that the effect is felt only at the beginning: the work is rapidly gaining momentum and the company is increasing its financial strength, but then the effect is leveled. The reasons are different:
- Employees involved in kickback schemes put their own interests ahead of the company's interests. As a result, the efficiency of the company as a whole falls, while the position of dishonest managers improves.
- Recoil schemes encouraged at the management level set off a chain reaction. As a result, the company's employees begin to do the same and set inflated prices for products, increasing their salaries illegally. Sometimes the amount of money stolen significantly exceeds the salary of an employee of the company.
- The habit of working by agreement, and not according to documents, reduces the quality of a product , be it a product or a service. As a result, the company can lose customers over time.
Rollback schemes have a destructive effect on the company. Rollbacks should be prohibited at the management level and exposed by all participants in the workflow. The main prevention of kickbacks has been and remains a decent wage, the ability to increase earnings by legal means and a healthy corporate culture.
