Ethical Dilemma

Can Embezzlement Ever Be a Loan?

FACTS Susan Jennings was the head cashier for Pears,

a highly respected discount store located in the heart of Chi$-$

cago. Her job included distributing funds to each cashier,

periodically collecting any large amounts from them, making

a collection at the end of each shift, and depositing the pre$-$

vious day's receipts each morning. When a cashier brought

money to Susan, the cashier would count the money and

Susan would check it$.$ At the end of each day, Susan would

make out a deposit slip for the amount of cash and checks

received, giving a copy of the slip to the accounting depart$-$

ment for proper book entry. She would indorse each check

with a company stamp marked "For Deposit Only."

On December $1,$ Alvin Troop, a new cashier, finished his

shift and brought his money tray to Susan. While counting

his receipts, he had noticed a check for $$120$ that had been

made out without a payee. Alvin brought the check to Sus$-$

an's attention. Matching his receipts to the cash register

tape, Susan found that Alvin was exactly $$120$ over. Susan

told him not to worry and said that she would fill in the

store's name when she made the next deposit and would

reconcile the receipts to the tape.

On December $2,$ Susan deposited the previous day's

receipts in Pears's account in the First Sandy Hill Bank of

Chicago, but decided to borrow $$120$ for her Christmas

shopping. Short of cash and wanting to take advantage of

a special sale, she intended to make up the difference on

December $5,$ which was a payday. She filled her name in

on the blank check, which also was drawn on the First

Sandy Hill Bank, and the bank cashed it$.$ Three days later,

she replaced the money. No one knew what she had done

until the customer who had written the check received his

bank statement and demanded that the bank credit his

account for the amount of the check that showed Susan as

the payee.

Social, Policy, and Ethical Considerations

Were Susan's actions unethical or illegal? Explain.

Would Susan's using the money for essential items, such

as food or medicine, change your answer?

What should Susan have done?

What responsibility does the First Sandy Hill Bank have

to its customers? In general, are banking procedures and

standards established for the benefit of the bank or for

that of the public?

If the bank teller had any idea that Susan had done some$-$

thing wrong, does the fact that he may have followed

banking rules relieve him of any ethical responsibility?