Case Study 3

James began working for NewCo nearly 20 years ago, where he has been working as the facility and mainte- nance supervisor. During the past 20 years, NewCo has experienced significant growth, and James has played a major part in helping move along the expansion plans. Because of his great service and abilities, James is greatly respected in the company. Although he  has been very helpful to the company, he was forced to leave due to severe health problems.

 

Earl was called in to replace James after he was re- leased. James’s sudden departure prevented Earl from working with James and learning the proper policies and procedures James had put into  place  before he left. The lack of training created a problem for Earl, who was faced with finishing the projects James had started. The major project James left was a construction project where the price had already been determined but no work had  begun.  Unfortunately,  Earl  could not find any contractor  information,  nor  could  he find any of James’s contacts.

As Earl continued to search, he realized that he was in more trouble than he thought because there were no records available for any of the work that James had performed. The lack of information forced Earl to bid the contract out to a new contractor. When Earl re- ceived the new bid and presented it to management, they were surprised to  find  that  the  new  price was 30 percent less than the original  bid.

Management believed the new bid price was wrong and questioned Earl to ensure that he had included all of the requirements for the project. Once management de- termined he had, it began to ask more questions. In looking around and reviewing some of his previous ac- tivities, management realized that he was no longer bid- ding out projects but rather giving them to specific contractors. When reviewing these contractors, manage- ment found that it had no information for the contrac- tors on file—no addresses, phone numbers, or even tax ID numbers. All management had was a name, and from that information, accounts payable cut a check and James delivered the checks personally.

Based on this new information, management began to question other employees about James’s activities. It found that others considered him very  secretive and that he refused to allow anyone to work with him on his projects. Others told management that James had also recently become very violent and erratic  with many of the employees. Because of the number of red flags, management has called you in to investigate Ja- mes’s previous activities.