Picking check is a financial term used to describe a fraudulent practice in which an employee manipulates a company's accounts to steal or misappropriate money gradually, usually in small amounts, over an extended period of time. This type of theft typically occurs by manipulating financial transactions and records, making it difficult to detect by auditors or management.
The term "picking" refers to the thief's method of stealing small amounts of money from various sources or transactions. By picking various transactions throughout the company, the employee can avoid suspicion and make it harder for the theft to be identified. They may take advantage of vulnerabilities in the company's internal control systems, exploit loopholes, or manipulate records to create false entries, thereby diverting funds to their own benefit.
Picking checks is generally done over an extended period, as taking larger amounts at once may raise suspicion. Due to the incremental nature of the theft, it may go unnoticed for a significant duration, resulting in substantial financial losses for the affected organization.
Companies often implement internal controls, including segregation of duties and regular audits, to minimize the risk of picking checks and detect such fraudulent activities. Additionally, the use of advanced technology, data analytics, and regular monitoring can help identify suspicious patterns or anomalies in financial transactions, thus preventing or catching picking check fraud.
