It is an unfortunate part of our business that people steal. Even with all the checks and balances in place there are still a lot of ways to nab cash and be dishonest. Audits help but even then if a thief finds weaknesses, it can be hard to spot. The hardest part is the betrayal of trust.

In response to the original question of this posting, read everything you can on audits and this topic to help. Trust your instincts. It is hard to believe that someone that you have trusted is stealing but the ones that get away with it for a long period of time are generally seem to be the ones that are trusted the most. Unfortunately you will get a crash course in the ways of theft just by digging in and learning what happened at this facility in the past. You will probably uncover some new things that you can share with the rest of us.

Additionally if you think the sale price is unfair, you can offer some additional payment to the owner payable after some period of time (like a year) based on your actual results for the year. However, it is not your responsibility to make up for poor past management. Good luck!

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Linnea Appleby

Unfortunately theft occurs in many types of businesses and self storage isn't any different. It's important for owners to implement practices and procedures that will minimize if not eliminate theft. Audits are also a critical part of owning a self storage property. Most other businesses perform some sort of audit/inventory on an annual basis and you should as well.

I am aware of a few cases in which the manager took money or used tenants credit card numbers to purchase goods/services. In one particular case I was at a facility performing an audit and the manager pocketed money right in front of me. Not very smart... I am happy to say that I didn't have to waste a day in court since they admitted guilt after being arrested for other thefts found in the process.

Some management software has the ability to grant various access levels and rights to users. I strongly urge owners to take advantage of them and assign them to your managers. Not all staff need the ability to adjust rent rates, refund payments, delete payments, wave late fees, and a multitude of other things that could lead to the misappropriation of money.

~ Michael

__________________
Michael T. Bishop
Sperry Van Ness/Jackcon Cooper, Inc.
Commercial Real Estate Advisor & Self Storage Consultant
www.svnjci.com
michael.bishop@svn.com
208-806-1550 (Direct)

Follow me on Twitter: @MichaelTBishop @StorageLand @StorageForSale

We also have had theft in the past. Since we are a small family run business, we have had to watch things close or else take the chance of losing any profit we might have. Years ago we instituted audit procedures for spaces, leases and payments received at move in. Handwritten receipts are not allowed except when our server is inaccessible. We do not accept cash payments except at move in. We audit new leases and the move in charges periodically. We also perform space audits. The managers are unaware when that may happen. This also ensures that all paperwork and procedures are followed regarding ssn's, drivers licenses, registrations for vehicles, proof of ins,etc. that we scan in to our system. Unfortunately for us all, the old saying, "1 bad apple...." causes us to have to look over those shoulders with the cameras in the office, the tracking of software entries, receipts, etc. We've also had managers that waived fees in exchange for work done for them personally. Of course, we terminated them and made sure that all the employees were made aware that if we found them pursuing any type of suspicious behavior that they could be subject to termination. Ahhhh... for the good old days when there was no reason not to trust.

Go to Domico.Com. In the bottom right corner of their web page you will see a red clickable phrase saying "Auditing Self Storage Webinar". Watch this free webinar and you will find your answers on investigating fraud. Although we've never used them, the company that produced this webinar evidently does these audits and more.

Control your inventory and you control your facility. Yes, it's that easy.

Welcome Sunday!

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Never put limits on yourself!

Shannon

I have caught other managers who have stolen and I could prove it .... and the biggest problem I see is no prosecution of the culprits...
all too often the managers get away with it because the owners or the management co. don't want to prosecute because they don't want the tenants knowing that the managers were theives , just in case they had broke into a unit and stole something and then the owners would be sued for the missing items ... In fact I have had two management companies tell me flat out ,( I dont want to hear it ) (just forget it ) .. ( we don't want the owners to know .. and we don't want tenants coming to us saying they have stuff missing )...
even though these managers have stolen thousands they never get punished and just go on to other facilitys and just start their scam over and over ... I even had one owner tell me , Please dont tell me that , they have been with me for 10 years and I would hate to think they would steal from me ... We quit because she just continued to let things be, she didnt want to be disappointed in them ...... And we didn't want to get blamed for any of the stuff the other managers were doing ... I hate following those managers cause there is always problems , the contracts are a mess if there are any... that's my 2 cents .

I totally understand what you are saying "Khall"........I've had to clean-up a lot of 'situations' in my day in the same regard that you are describing......it can be difficult to follow after that type of "manager"...........

Please understand that most facilities carry what is called " employee dishonesty" coverage and when there is a claim for a theft, it is turned over to the insurance company. Most times, the owner/Management company does not have the control to press charges. Secondly, once reported to the local authorities, most will not even investigate the crime because it is to time consuming and they are buried with "more important" crimes. Lastly, they do not understand our business so it is very hard for them to get a detective to spend enough time investigating the crime.

So lets not be to quick to jump on the owners/management companies as many times it is not their decision. I for one wish if caught these persons would go directly to jail and we could publish that in the newspaper and maybe this would deter others from doing this. Stealing is just plain wrong.

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Mel Holsinger, President
Professional Self Storage Management, LLC
3434 E. Kleindale Ste. E
Tucson, AZ 85716
O: 520.320.9135
F: 520.320.9435
www.proselfstorage.com

Thank for clearing that up ,, it would have been nice if the owners at the time 13 yrs ago would have told me that, instead of saying they didn't want to hear it..
But still I can see how it would effect a facility if the word got out because you can be sure there are those tenants who would all of sudden have stuff missing ...
Still I wish there was some way to get those managers who steal ,, to not be hired again anywhere else . as I know they are still working in the business for other companies because I have seen them at the conference meetings.
You can be sure I keep tabs on where they are too. One set has moved to another part of the state and the other is going to retire ... I am sure they haven't changed their spots either , most don't...
And if they ever went to work at our company you can be sure I would tell, so they could audit them more often.... but you can bet if they knew I was here they wouldn't take the job cause they know I told on them once, and would do it again.
It just makes me sad that a few make it so bad for the rest of us, who really care about our facilitys , and try our best to make it profitable for our owners...