Bar Frauds

 

Frauds by customer

Customer walking without paying

The primary kind of customer fraud is customers walking out without paying their checks. However, customers may also cheat an establishment by a number of other methods. They may claim that the food was unsatisfactory and thus indicate (usually the manager or host will make the suggestion) that they will not pay for it.

Bringing foreign article

Another possibility, which has occurred frequently, is for customers to indicate that their food contained some foreign matter, such as glass or china, or even an insect (perhaps even brought in by the complaining customers).

Customer making unnecessary complaints

Complaints are generally made to the waiter or waitress, who should in turn call the manager or host to solve the problem. Since there is always the possibility that the events did in truth occur, the normal policy is to grant free drinks or dinners to the guests to avoid embarrassment, to prevent possible lawsuits, and, of course, to encourage the customers to return. In most cases of fraud, the guests will not return to perform the same type of fraud nor will they return merely to buy a dinner.

In the case of falsified complaints, the establishment has no recourse except to treat the affair as a normal business expense. In cases of walkouts, the house may have legal recourse, and of course it can set up a control system that minimizes the chances of this type of theft.

Using false credit card-

Customers may also use credit cards that are worthless or attempt to pay with checks that are not honoured by banks. Unless customers are known, it is best to avoide cashing checks if possible. If a check must be cashed, adequate identification should be provided, and no check should be honoured for more than the value of the dinner.

Counterfeit currency-

Occasionally  customers will attempt, either intentionally or unintentionally, to give to cahier counterfeit currency. In most cases, this currency will be easy to detect if proper cash handling procedure are followed. All bills should quickly examined on both sides and placed on the ledge of the register. It is hoped that this cursory examination will detect most of the counterfeit money, although in some cases help of the expert can be take.

Thefts by waiter and waitress-

Intentional omission  of items-items are omitted from the bill in order to establish a rapport with customers, to increase tips, or perhaps to give free merchandise to friends or fellow employees. This type of fraud occur when inadequate dupe system or validating systems are utilized. A full control system in organizations having full services is impractical, since accounting for items with a retail sales value of less than $1 is too costly. Bookkeeping costs would be excessive in relation to income.
In some cases, the items that are to be sold are already under the control of the service staff, as in the case of milk in individual containers or a 6-gallon refrigerated carton in the service area. No records are is maintained when a waitress or waiter pour a glass of milk. Should this charge be omitted from the check, it would be impossible to track down the guilty  party, since a number of personnel may have access to the milk supply.

Reusing of checks-

 This type of theft may occur in any kind of establishment. For high volume operations, it is possible that a large number of sales may be of the small dollar amount. Thus customers presented with a particular check would have no way of verifying whether it was their own or not, since the dollar amount were correct and the items were the same. With the abbreviation normally used on checks it may be impossible for the guest to read a check without an interpreter. So long as the doller amount is correct, they are satisfied.unless the dollar amount is higher, most customers do not care if they receive their own check.

Pocketing checks or using unauthorized checks-

 it is often possible to reproduce the checks that are used by an establishment. Certainly if stock checks(not specially imprinted ones) are being used, they may be readily be purchased by anyone form dealers. It is also possible when checks are not numbered or recorded (and in those cases where the numbers are recorded but not audited) for a waiter or waitress simply to pocket the check and the cash received, if other control systems are not utilized.
Checks can be counted automatically by the utilization of a check numbereing system similar to UPC(universal product code) or those system s being used by banks. Each check is imprinted with a number that can be read by a machine. If a number is omitted or the check not closed out, the machine will report this omission. These systems are readily available that have been made in electronic technology.

Over charging-

 This practice  may occur when staff members are allowed to make corrections on the checks without supervision. The customers may be charged for merchandise not received. Or higher prices may be entered on the check. After the customer has paid the staff member, the correct prices and amounts are entered, the check is retotaled, and the difference is pocketed by the server.
Incorrect addition- intentionally adding a dollar to each check and pocketing the money when check is properly totaled can readily be performed, particularly if amounts are handwritten on the checks. Should the error be discovered by the customer it is normally excused, since an error is overadding can be quickly explained away as poor arithmetic.

Substitution-

 In some establishments with fairly tight system of control, it may be impossible for a waitress  or waiter to supply friends with free merchandise. However, substitution can be made by ordering higher priced items from the kitchen and charging for lower priced ones. The server orders a higer priced item but records a lower priced item on the check. The friend is presented with a check for the smaller amount.
Falsification of tips or other charges- in some areas of the country, where many food and beverage sales are complimentary, other incidents occur where a dinner is bing paid for by someone other then the guest. Extra amount of beverages or food may be placed on the checks too increase the value of the sale. This extra food can be sold to other guests and the cash received pocketed by the waiter or waitress. This padding of the bill may also be done whenever the tip may be a fixed proportion of the total bill. If the the sales are increased by 1000rs the the tip may go up to 100rs or more. When given  a free dinner the guest does not closely inspect the items on the bill. Instead, he or she merely gives a brief inspection, signs for the full amount, and leaves a tip based on the total value listed on the check.
Incorrect change- short changing of customer is possible no matter what system is used. It cannot be prevented without s shopper system, which may or may not be able to detect the fraud. Certainly, if repeated complaints by customers occur, immediate action must be taken.
A shopper system is one in which a person unknown to the regular employees is hired to come into the store and posing as a customer, checks on the efficiency of the operation and various segments of the system.

Split rings-

 When waiter or waitress salso handles the cash registers, split rings may occur this situation arises when for example,a check for 1000rs is rung up 500rs and 400rs. The owner has lost 100rs which the waiter or waitress pockets.
By ringing the second time, the waiter or waitress prevents the customer from seeing the actual amount of the first ring-up. The customer usually presumes there was a simple error. Should anyone question the two rings for one check, the waiter or waitress merely states that he or she made a error on the first ring and rang 900rs by mistake. Using ca cash register with a tape and giving guests receipt will help to alleviate this type of fraud.

Bar tenders fraud or errors

A bar tender who handles cash(using a register) has the same opportunity of theft as a waiter or a waitress- and the same chance of error.

Cashier theft or error

The possibility of theft for cashier is more restricted than with either bartender, waiters, or waitress, since they normally do not handle the products sold. If the cashier is responsible solely for cash collection, errors or theft may occur under any of the following categories;
1.    Cashier keeps the money and pockets or destroys a check.
2.    Cashier changes the total of check after collection.
3.    Cashier bunches sales, split-rings, or underrings.
4.    Cashier gives uncorrect change.
5.    Cashier performs incorrect addition.
6.    Cashier falsifies payout or adds items to complimentary checks and removes them from other checks.

Links for videos on bar Frauds

https://www.youtube.com/watch?v=jJa52Ovb7Eg

https://www.youtube.com/watch?v=_ZeGKi1CY_Y

https://www.youtube.com/watch?v=yaMHbmZDQ_Y