When a consultant has evidence that suggests a fellow contractor has been stealing and reselling a client’s computer equipment to other employees, you would think that the consultant could turn the perpetrator in without a problem. That would be true if our consultant were a regular employee. In that case, a call to HR—and probably the police—would be the obvious solution.

But as a consultant on a contract, things couldn’t be more complicated. When this particular consultant discovered that an employee’s home computer was actually one that was still listed as being in circulation in the client’s inventory tracking system, he was confronted with a dilemma: If he reported the offense, he could place his firm’s consulting job in danger and would end up paying for every piece of computer equipment that had been taken under his firm’s watch.

Here’s a closer look at the consultant’s dilemma and what eventually happened.

The scenario
“I am a consultant who is on contract with the IT department of a large manufacturing plant. For the past five years, I’ve provided complete technical solutions for this client, which has 500 workstations.

“Recently, I noticed that some small items were missing from the IT inventory, mostly memory modules from computers stored for distribution to users in an unsecured room. I had suspected a coworker, a fellow consultant with my firm, was taking them, but I had nothing to prove my suspicions until one of my users had me look at an issue with his home computer.

“When he brought the home computer to me, I noticed that my client’s inventory number was still on the computer. I first thought that this machine had been sold to move obsolete equipment out of the client’s company, but after a thorough check, I found out that this computer was registered as being still in use by the client.

“After talking with the person who brought the computer to me, I found out that the computer was sold to him by the coworker that I suspected was taking memory out of machines. Following an annual inventory check, I found out that several computers were missing as well.

“When confronted with the evidence, the suspected coworker denied any wrongdoing, offering some half-verifiable documentation of buying the computer from the company. But a check of the company’s online inventory report verified that this computer was designated for an employee other than the suspected consultant. A conversation with the person responsible for sales of obsolete equipment, who said that the computer was to be used for several more years, also verified that the computer was stolen.”

The reaction
“Here was my dilemma: If I reported the thieving consultant to our client company, I feared our bid would be in danger. Plus, we would have to pay for every missing piece of equipment. If I reported him to my company, he would most likely lose his job (which isn’t so bad, considering his work practices), but all others working for this client would then be viewed suspiciously.

“If I did nothing, the dishonest employee would stay, and—because the thefts happened while we were in charge of the IT department—our company would still end up having to pay the damages. Obviously, this coworker lost the trust of everyone, and I was worried he would take something else the next time he was in the IT department alone, which happened often, since we all have keys and 24-hour access because of the nature of our business.

“In the end, I and several others reported the employee to a project manager who then notified the client company. Once our clients found out about the thieving consultant, they were at first shocked, but later they notified my company and waited for our response. My company called a meeting, during which the thieving consultant and I were both present. The thieving consultant was given a chance to clear his name by providing explanations for everything that happened. He tried to defend himself by blaming other coworkers, speaking of conspiracies against him and, of course, lying.

“It was pretty obvious at that moment what his fate would be. He was given until the next morning to provide evidence of purchasing that computer. He couldn’t do that, and so the next morning the thieving consultant was fired.

“Our clients, although disappointed, were satisfied and surprised by the quick response. My company is also paying for all the damages made. (We have since found several other computers that were “altered” by the thieving consultant, but no new problems have been reported since he left.)

What do you think?
Faced with a similar situation, what would you do? If you’ve dealt with something similar to this, what action did you take? If you were a client, how would you react to revelations that a consultant was stealing your equipment? Post your comments and suggestions below.