Stealing to Payback Stolen Money

This week’s fraud isn’t especially remarkable except for the motive. But it can be a little confusing.

From Wales (the country not the species) , Mayur Gaglani (not to be confused with Mayor Giuliani), stole a substantial amount of money from his employer, believed to be about £250,000. It appears he was required to pay the sum back, so Mayur got to work. In 2017 Gaglani got a job with PSE 2 (not PS2), a small company selling electrical systems.

.Between June and August of 2022, Gaglani created fake invoices to the tune of £64,000, which the company paid. Additionally, Gagliani went to US on holiday and used the company credit card to rack up £5,000 of personal charges. It was the company card charges that got him caught.

So far this is pretty straight forward, falsifying invoices and personal use of the company card. It gets worse. At his sentencing hearing, it was revealed that Gaglani explained to Gary Porter of PSE 2 that he had a previous dispute with an employer and significant debts. Mr. Porter loaned Gaglani £60,000 and gave him a £22,000 salary advance to help him out.

Let’s do some math, £64,000+5,000+60,000+22,000 = £151,000.

Gaglani said that he committed fraud to pay back money stolen from his previous employer. It’s not clear how much of the stolen money was actually paid back because Gaglani also used part of the money to pay his own debts. Cleary Gaglani was in way over his head. I’m also not sure what his end game was. Did he think he wouldn’t get caught this time?

The effect of the fraud on PSE 2 was significant. Instead of growing and being able to hire more employees, they were forced to retrench and 5 employees had to change the nature of their work. Gaglani was sentenced to 20 months in prison.

Controls matter. Whether it’s Apple or PSE 2. Big or Small. I see plenty of companies say “we’re too small” to worry about controls, but £151,000 matters a lot more to small company than $20 million does to Apple.