What he found was a complex and calculated system of fraud, which the employee meticulously planned and executed on an incremental level, so as to avoid detection. According to Cubbage, his group began to look at the profile of the cashier’s transactions, searching for common characteristics. They began to find some, such as several identical, high dollar UPCs that were used over and over again for refunds. “From there we built a model for her typical transaction and ran that model through our raw POS [point-of-sale] data,” Cubbage said.
They uncovered that the cashier used customer data obtained from layaway and refunds to process fraudulent refunds, and then pocketed the money. Part of what the cashier thought was protecting her from detection actually worked against her. At the AAFES, a refund over 10 percent is followed up with a call to the customer to see how service can be improved. To keep this from happening, the cashier deleted the customer information from the transaction. “That can only be done manually, so she would have had to have done that,” Cubbage said.
From its initial investigation, the team identified 623 different customer ID numbers used in fraudulent transactions (even some for customers who were no longer alive), representing about $53,000 in stolen revenue. The rest was left up to the employee to tell. Once discovered, the cashier confessed to her methods. Using new information she provided, Cubbage was able to discover that she stole about $114,000 over eight months. Because the AAFES is government owned, the FBI took over the case and the employee was prosecuted in a federal court, pleading guilty to the charges. Not just a victory in catching the criminal, this became a justification for organizing the department in the first place. “This is exactly the kind of case we wanted to uncover,” Cubbage said.