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Summit Loss Prevention
serves the following industries and their specific loss prevention and investigative needs based on more than two decades experience.


• Internal Theft -
• Embezzlement
• Robbery
• Burglary
• Fraud
• Shoplifting -
• Employee Substance Abuse -
• Workplace Violence -
• Intimidation
• Sexual Harassment
• Staged Accidents & Resulting Litigation
• Insurance Fraud -
• Worker Compensation and FMLA
• Shrink Due to Poor Inventory Controls or Vendor Theft
• Inappropriate Cash Handling Procedures
• Poor Audit Controls and Paperwork Errors
• Deposit Discrepancies
• Other Criminal Acts

Security & Safety Site Assessment Report

Security & Safety Site Assessment: Loss Prevention, Reduce Vulnerability to Loss, Eliminate Potential Liability Exposure, Cost-Effective, LP Awareness Training

The report below is a sample of a Security and Safety Site Assessment conducted by Summit Loss Prevention Consulting. This is an actual report -- however, to protect the privacy of all parties involved, the names and locations have been changed.  Click on a topic below to scroll down to the section.

General Information

A.    Name of Facility:              Sky-Hi Aerospace Components

B.    Address:                          678 South Street

        City/State:                       Dayton, OH 45377

        Phone #:                          937-555-1234

C.    President:                         Jack Jameson

D.    VP of Operations:              Mark Taylor

E.     VP of Human Resources:  James Poland

F.      Number of Employees:     340

G.     Operating Hours:              24 Hours Five Days/Some weekends

H.     Products Manufactured:    Parts for Aerospace and Military Components 


March 7, 2005



The investigator conducted a Loss Prevention Assessment at Sky-Hi Aerospace in Dayton, OH during January 2005.  This document will summarize the assessment results in several critical Loss Prevention areas.  The Assessment was done as part of an ongoing internal investigation at the facility.  A report on the investigation findings will be submitted separately.

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Scope of Loss Prevention Assessment

 The scope of the Loss Prevention Assessment was intentionally broad and multi-faceted to insure that all potential security related factors were addressed and given appropriate attention.  The investigator incorporated security industry standards as a benchmark for consistency and thoroughness, in addition to the input obtained from various Sky-Hi Aerospace management personnel.   

During the investigation of the criminal acts perpetrated at the facility, several vulnerabilities were identified that were also evaluated during the Loss Prevention Assessment conducted. 

The Loss Prevention Assessment covered four major areas of concern.  The primary areas covered are as follows:

  • Physical Security
  • Internal Security/Controls
  • Employee Controls
  • Equipment/Tools/Inventory Controls

In addition, the investigators conducted interviews with a cross-section of Sky-Hi’s employees and management personnel in an effort to identify any specific internal concerns related to loss prevention.

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Primary Findings

The results of the Loss Prevention Assessment indicate there are several areas of the business that are not adequately protected or consistently maintained from a Loss Prevention standpoint. The lack of a formalized Loss Prevention Program, or sufficient loss prevention focus on some vulnerable areas of the facility, is the primary finding of the Assessment. 

Specifically, there have been lapses in the amount of attention paid to asset protection of tools, raw materials, supply items and ‘scrap’ metal.  The recent internal investigation demonstrated that additional internal controls, designed to deter and/or detect theft and fraud activities by employees and management alike, are necessary within the facility. 

From an outside service provider standpoint, certain entities were not being monitored appropriately by some members of Sky-Hi’s management.  On a few occasions it was determined that these service providers took advantage to inflate their invoices or perform substandard work.  The deterrents in place were not being utilized properly to detect these situations in each case.  Certain internal controls need to be enhanced, implemented and routinely audited to monitor compliance and, when necessary, discipline those who are not in compliance with these requirements.

Physical security aspects such as burglar alarms, camera systems, key and lock control programs and others have not been maintained adequately, resulting in a poor overall loss prevention environment.  Maintenance Department management had responsibility for these systems and failed to maintain them properly.  The opportunity for internal theft is greatly increased when these systems are not utilized as they are designed.  Each of these systems needs to be brought up to an acceptable level of operation and then consistently maintained

 It was determined that the burglar alarm system has not been utilized effectively for approximately two years.  The system is not currently monitored by any outside agency.  At this time, a break-in to the facility would not be detected by the alarm system.  Procedures need to be enhanced and implemented to get the system back up and fully functional.

The camera system is not being utilized consistently and many of the camera placements reviewed are inappropriate and do not address loss prevention needs. Management staff are not routinely trained to utilize the existing camera system and therefore do not know how to maximize it as a management and loss prevention tool.  Specific guidelines need to be designed and implemented for the training and subsequent use of this system. 

The integrity of the key and lock control system has been compromised and needs to be revamped.  An unknown number of Grand Master keys that provide access to many doors within the facility have been distributed haphazardly to numerous employees without consideration of their real need to possess them.  There have been no definitive records maintained of the keys that have been distributed to employees for the past 18-20 months.  There is no way to recover all the GM keys that are unaccounted for within the facility.  This is a significant issue from both a security and safety perspective. 

From the Human Resource standpoint, background checks currently do not include a criminal records check or driving history, both important tools in determining who is being hired and brought into the facility.  Management and employee interviews revealed there are suspected narcotic and controlled substance users among the workforce.  Specific individuals have been identified as drug ‘dealers’ or ‘suppliers’.  Suspicions of alcohol impairment were raised as well. Each of these issues warrants further investigation.  Management persons interviewed during the assessment indicated that they were not adequately trained or prepared to respond to drug or alcohol impairment or drug dealing issues from either a business or criminal perspective.  Loss Prevention training and awareness is needed in this area. 

The current drug screening process is not as strong a deterrent as it should be and there is some indication that the company random drug screening dates may not be confidential.  It has been alleged that an employee of the company Sky-Hi utilizes to conduct the screening has been alerting Sky-Hi employees to these dates in advance, undermining the intent and integrity of the process.  Further investigation is needed to completely assess this situation. 

There is no formal post accident drug testing currently available.  Any time there is an accident with injury or an incident resulting in a pre-determined amount of dollar loss a post-event drug screen should take place.  Historically, this post-event testing will reduce the number of worker’s compensation cases and also lower the number of accidents and incidents over time.

The submission of bogus overtime hours and subsequent payroll fraud has been an issue with several employees and their supervisor.  The investigation identified this issue within the Maintenance Department. 

Overtime hours, in general, were not monitored or controlled within the Maintenance Department.    In one instance an employee was paid more than double what his hourly wages would have been over a two-year period of time through unsupervised overtime.  Management in this department was not held accountable for overtime within this department.  A system to identify abuses is not currently in place. 

There have been several employee accidents involving injury that warranted additional investigation.  The accident response process needs to be enhanced and conducted in a systematic method.  Currently, some accidents receive a sufficient response, however the accident reporting guidelines are not consistent and some accidents are not reviewed.  This results in potential fraud within the Worker’s Compensation coverage area.  Accident and injury investigation techniques need to be addressed to deter fraud and improve safety and loss reduction. 

In the Electronic Technology area of the business (computer systems), it was determined that protection of proprietary information (PIP) and electronic information security (ELIS) is sub-standard given the sensitive nature of the business.  Management staff acknowledged during interviews that they have e-mailed company information they are working on to their personal computers at home.  It is recommended that this practice be prohibited.  The security risks associated with this practice are significant.

According to the IT Manager, there is no current program to monitor employee computer usage or outgoing e-mails.  There are few written policies or procedural restrictions regarding this sensitive area of the business.    Current policy addresses only user privacy issues and does not prohibit the behavior described above.  IT Management loss prevention awareness and training in this area is lacking.

Safety and Environmental policies, procedures and training programs have been designed and implemented within the facility.  Additional focus is needed to enhance the guidelines already established in this area by the current Safety Manager. 

The Safety review can be broken down into three areas:

  • Facility Safety
  • Employee Safety
  • Business Continuation

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Facility Safety

The review of the Facility Safety identified some key areas for improvement.  The local fire department has been contacted and provided with information regarding the facilities for response and pre-planning.  The need to continue to be aggressive with local FD code enforcement and training of responding firefighters is obvious. 

  • Internal protections such as extinguishers (multiple types) were in good working order and obviously marked, however the provided sprinkler systems requires annual testing by a certified vendor. 
  • Fire System testing at both plants should be conducted immediately; the system is essential to control fire growth and minimize damages. 
  • The system at Sky-Hi has had multiple changes and additions since the last certified test
  • The system at McDougal-Shell lacked acceptance testing and is due for annual testing. 
  • The Safety Manager should be present during testing procedures.

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Employee Safety

The highest risk for extensive injury, production disruption or liability arises from the use of several hazardous chemicals on site at Sky-Hi.  Storage is centrally located on site.  Several items could help to minimize the risk of accidents. 

  • Storage of drums on pallets help minimize risk of spills, but the environmental exposure of drum pallets causes them to fill with environmental moisture thus reducing their ability to contain a spill. 
  • The mixing of full and empty drums also causes worker confusion.  Drums should be marked in a way to delineate “full”, “in use” and “empty/residual.” 
  • A review of on site chemical usage should be conducted to determine the minimum amount of product used on a weekly/monthly basis so that unnecessary storage of product is kept to a minimum. 
  • A more thorough safety/haz-com interaction with managers responsible for chemical utilization would establish stronger control of drum allocation, usage, return and storage.  This interaction would also improve the education about drums with particle aluminum contamination that can sometimes be mixed with other drums in the drum storage area.  Marking of these drums or altogether prevention of this is optimum.

A tremendous benefit regarding chemical usage and any potential spills is the on-site hazardous materials response team.  The ability to have employees trained to respond to a facility spill decreases response time and decreases plant down time. 

  • Employees that work with a chemical and are well-trained in its risks can quickly and efficiently stop a leak or clean up a spill with proper training and equipment.  This is one area related to the haz-mat team that should be more thoroughly reviewed. 
  • Equipment such as Level A entry suits should be maintained in quantities large enough to mitigate hazards and must be pressure tested annually.  There should be equipment for response to a spill and separate equipment for training. 
  • A comprehensive training guideline should be established with minimum performance standards and annual training.  Current annual training for the team members is just a few times per year. 
  • All spills, releases and chemical usage should be reviewed by the team members to help identify and correct problems prior to incidents occurring.

Forklift training and certification procedures need to be reviewed.  The first place to start is the identification of key employees who are responsible for operating forklifts on a daily basis. 

  • Those employees should receive training and certification on an annual basis, as most currently do. 
  • A limited number of fill-in or part-time employees should be identified and receive training on a semi-annual basis.  The increase in training is necessary due to the limited number of times they access the vehicle, which increases the potential for an accident. 
  • Personnel who only occasionally utilize forklifts (less than 2-5 per month) should be discouraged from becoming certified, and shift-based operators should be identified.  This would greatly reduce the risk of damage or injury and lessen the current number of certified forklift operators in the plants.

Most of the facility equipment and machinery is in great working order and safety systems are in place and operating.  However:

  • Several presses were in need of safety modifications with upgrade equipment that is already on site.  The installation of that equipment should occur immediately. 
  • Anytime a safety issue is identified within the facility and equipment modification or procedural changes are required, they should take high priority. 
  • Some form of heat shielding or access restriction should be added in the sizing area at the Sky-Hi plant. 
  • In areas where laser usage takes place, a more comprehensive plan should be developed to limit access during use and possible exposure during operation.

The second floor storage area within the Sky-Hi plant over the production area at Sky-Hi should have a more thorough engineering review to check weight distribution to make sure the 65 lbs/sq ft maximum is not exceeded.

One of the largest injury rates during 2004 appears to be cuts and lacerations from exposed metals.  This will be partially discussed during employee safety, however managers and the safety manager should take a stronger approach at identifying and protecting exposed metal edges that are of high risk to help minimize exposure.

The review of Employee Safety issues also identified some areas of improvement.  Safety training of employees should occur in several different ways.  Employees should be initially trained regarding overall safety procedures and then be trained to their specific area.

  • Semi-annual refresher training should be conducted for all employees regarding plant operations and required trainings (i.e. hearing protection, lock out / tag out, etc). 
  • Manager trainings should occur monthly or quarterly to review safety concerns that may be new or causing issue within the plants. 
  • The safety committee must be staffed and meet monthly to review safety issues and help the safety manager identify issues that should be addressed.  After talking with Mike Wilson (safety manager) and during our observations it appeared to us during the assessment that many aspects of safety were not taken seriously by members of middle management.  
  • Additional training and audit functions should be implemented to stress several different areas of safety.

The injury reporting process should be revised to place stronger controls on employee responsibility for injuries. 

  • The current process does not identify causative factors and any remediation to prevent future injuries. 
  • It also does very little to identify process/procedural changes, equipment modifications or disciplinary action of the employee or manager. 
  • If the current system does not have employee, manager, safety committee/manager and executive management reviews installed the potential for abuse is present. 
  • A process should be established to reduce the number of reportable worker injuries. This injury reduction process should be facility-wide and production/plant area specific. 
  • Incentives or penalties should be developed.

Air management for employees is an area of concern at the McDougal-Shell plant. 

  • The fume and dust removal system that was installed when the plant opened has yet to be serviced.  A service regimen must be established that allows for optimum exhaust and collection. 
  • A filter changing schedule should be maintained by facility maintenance. 
  • Quarterly flow testing should be conducted at each entry/machining area to check performance of the exhaust system. 
  • During the inspection of the facility, aluminum dust covered most surfaces in the facility, including offices.  A check of the HVAC system showed that filters had been removed due to clogging and not replaced.  Obviously, it is dangerous to allow aluminum dust to migrate through the heater, and at a minimum it is a fire hazard. 
  • Previous exposure to the heaters in the Sky-Hi plant caused damage and replacement of expensive complete heater assemblies. 
  • The more important factor is that the amount of dust that caused the filters to clog is now being aggressively circulated throughout the plant for workers to breathe and is a repertory hazard. 
  • Remediation of the exhaust problem should limit a significant amount of the dust issue, but a maintenance schedule must be established for the HVAC filter change also. 
    • During the assessment we spoke with John Winston from Twin Oaks, who advised he would submit a quote for this service.
    • This should not be conducted by any outside vendor. This is a simple maintenance task which should be provided by Sky-Hi maintenance people on a weekly basis. 
  • It should also be of consideration during the expansion of the McDougal-Shell plant to enclose an employee break/dining area. The current area is next to, and exposure continues, for employees during breaks and dining.

The safety manager has an annual review of Personal Protective Equipment (PPE) hazard evaluation requirements for each worker.  The Safety Manager, Plant Managers and employees must utilize provided equipment where required. 

  • If the hazard evaluation identifies required equipment and the PPE is provided, the employees should be required to utilize it. 
  • The hazard evaluation should look at process/procedural changes to prevent employee exposure to risk. 
  • When those changes are not an option and PPE is required, it is the last level of protection for the employee. 
  • As part of this, the facility manager and safety manager should review the policy of allowing employees to eat or smoke at their workstation.  This can be distracting and it prevents employees for utilizing assigned PPE (i.e. gloves, full face shields, etc.). 
  • Several areas that were specifically identified as ‘no eating’ had employees snacking during the facility review.

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Business Continuation

There is already a Business Continuation plan in place for the facilities. 

  • The plan needs to be reviewed at a minimum annually and updated. 
  • Sections should be dedicated to each operation of the company (i.e. Accounting, Human Resources, Production, etc.) as to the requirements for emergency operations or movement offsite. 
  • Due to some of the types of items produced within the facility a stronger terrorism reduction plan should be in place. 
    • Key management and office personnel should receive training in facility and personnel protection related to potential terrorist risks. 
  • A plan should be developed that mirrors the national risk level and includes procedural facility and personnel changes as the national (soon to be regional) risk levels change (i.e. yellow to orange, orange to red, etc.). 
    • The plan should also include training and procedures for specific risks that may be specific to a region or facility. 
    • The plan must insure for duplication of essential records that would allow the company to continue operations if an area were destroyed or access denied. 
  • The business continuation plan should be in all hazard manuals that allows for raw stock, machinery and chemicals to continue to arrive at the plants, daily employee productions, payroll and facility operation to occur and completed projects to be forwarded to customers during or after any national, regional, local or facility incident.

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Loss Prevention Issues

The loss prevention issues identified during the assessment are listed in this segment of the report.  Assessment findings to be addressed include the following items:

  • Design and implement a Loss Prevention Program for all locations.  The program should include the following items:
    • Require Comprehensive Background Checks for all job candidates.  Specific applicant information should be obtained regarding criminal, civil, or driving issues to preclude hiring those individuals with troubling histories.
    • Verify that Subcontractors and Temporary Agencies perform similar Background Checks for any individual that will perform work within the facility.  Maintaining a consistently high standard for these employees helps avoid security and liability issues.  Additionally, recurrent review of all contractors and service providers should be conducted to maintain appropriate checks and balances and avoid abuses.
    • Require current employees and management to notify Sky-Hi if they are convicted of a felony offense during the course of their employment with the company.  It is appropriate for an employer to be made aware of their employee’s criminal status as it may jeopardize security at the facility.  Periodic background updates are permissible and recommended on an as needed basis.
    • Include a Duty to Inform requirement in the Employee Handbook or Policy Manual.  Simply stated, this policy requires employees who have knowledge of a security or safety issue to inform management about the issue.  This policy allows employees to bring useful information forward that they otherwise might feel uncomfortable sharing with management.  Examples of the type of information employees become aware of are:
      • Internal Theft
      • Substance Abuse
      • Safety Violations
      • Harassment
      • Workplace Violence
      • Enhance the current Drug and Alcohol Screening Program by adding:
        • Post-Accident testing on a 100% mandatory basis – this will identify employees who were impaired at the time of their accident and thereby reduce Worker Compensation expenses
        • Include the entire workforce in the current Random Drug Screening program, not just those required by the FAA or DOT – this will be an added deterrent to the 33% of employees not currently subject to the Random Screening Provisions
        • Train and educate management to utilize the ‘For Cause’ testing provision on an ‘as needed’ basis – this deterrent tool is already available under the current Drug Policy but has not been utilized on a single occasion by management to date
      • Require more strict compliance related to Photo Identification Badges. They are to be worn at all times while on company property.  Retain a copy of each employee’s photo in the employee’s personnel file for use as needed.  Enforce guidelines for the recovery of the ID badge upon separation from the company.
      • Establish a Key Control Policy that provides consistent guidelines for management related to assigning, accounting for, securing, and recovering all facility keys.  This policy should include forms to be utilized at the facility to record key assignment and recovery information.  Each key holder is required to sign for keys they receive and agree to comply with security provisions associated with key controls.

        An O-K Lock representative has reviewed the existing key and lock set-up at the facility and a report specifying the recommended changes is being prepared for review.

      • Repair or replace all equipment required to arm the ADT security system and maintain use of the system on an ongoing basis.  This entails revising all pass code holders numbers and determining a ‘Call list’ to be used by the ADT monitoring station in the event of unauthorized or undetermined activity.  Additionally, procedures and training must be designed and implemented on the acceptable use of the system.  A review of the system was concluded during the Assessment.  The changes to the system are included in a separate document attached to this report.
      • The Security Camera System (CCTV) should be enhanced and utilized on a consistent basis to deter losses and encourage efficient and productive work performance.  The system should continue to be utilized to review accidents and other incidents as it has been in the past.  The specific enhancements include expanding the number of cameras at the facility from 5 to 8, and reconfiguring the placement and/or angle of camera coverage at the primary facility.  The review process has been concluded during the Assessment.  The changes to the system are outlined in a separate document attached to this report.
      • Design and implement Loss Prevention Training for all Sky-Hi’s management and employees.  The lack of a consistent training program to raise awareness and educate employees and management about basic loss prevention responsibilities is a major issue and increases the likelihood of internal theft and other negative behaviors.  As with Safety Training, it is proven that recurrent training sessions have a positive impact on the bottom line. The program should consist of three separate types of training based on the audience:
        • New Hire Orientation – Employee Handbook reviewed – Signature page obtained and filed.  Explains basic loss prevention policies and procedures.  Establishes the appropriate environment that Sky-Hi intends for its employees to operate within.  Outlines expectations and standards to be maintained.
        • Employee Training - Designed to raise Loss Prevention and Security awareness for current employees.  Re-emphasizes Loss Prevention standards and allows experienced employees an opportunity to seek clarification or offer input on any LP or Safety issues they may have.
        • Management Training – Designed to educate and increase the confidence level of Sky-Hi’s Management staff and raise their awareness on LP issues such as internal theft and employee substance abuse. Includes exercises on writing Incident Reports, and conducting basic fact-finding interviews for incidents they may face.
      • There is a lack of management awareness concerning Reasonable Cause Drug Screens if an employee is suspected of being under the influence of alcohol or controlled substances. 
        • More emphasis needs to be placed on what management can, and should, do in the event of this situation. 
        • It was determined that many of the management currently in place are reluctant to get involved and make a decision in situations that warrant immediate attention. 
        • Managers need to be better educated about the process so they become more confident to use it.
      • There is no formal Inventory Control System in place to account for company tools, equipment, chemicals or product. 
        • Management reported losses in these areas, however with no system in place to account for the losses, it becomes difficult to attack the issue and identify who is responsible. 
        • An Inventory Control System will deter internal theft and assist in holding individuals accountable for their work habits.  This system includes an Etching Program for all expensive tools and equipment. 
        • A specific program for the recovery of all ‘scrap’ metal can be included in this system.
      • There was a consistent finding that indicated a lack of Loss Prevention Documentation and Communication. 
        • Internal incidents that occurred within the facility were not consistently documented or properly communicated to upper management for follow-up or review. 
        • Management LP training sessions targeting this issue will improve their ability to complete these informational reports. 

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    Primary Recommendations

    The design and implementation of a comprehensive Loss Prevention Program, with appropriate procedural guidelines and sufficient focus is the primary recommendation of the Assessment. 

    • Within the LP Program, there are various components to be considered as a whole.  Enhancements to the Background Check policies and a revised Employment Application are initial items within the LP Program.  Formalized Loss Prevention Orientation and Training components will be designed and implemented for all Sky-Hi management, new-hires and current employees. 


    • Management training should include specific instruction on responding to potentially criminal issues such as internal theft and narcotics sales or use.  The LP Program will also provide specific policy and procedure related to the administration of Key Controls, Access and Egress Controls, Security Camera System, Burglar Alarm System, and Inventory Controls (Etching Program, Tool Crib Operation, Scrap Metal Recovery Program, etc.). 


    • The cost centers that will benefit directly from the Loss Prevention Program implementation are OSP (including tooling), payroll, scrap recovery, maintenance and shipping/receiving, among others.


    • Proprietary Information Protection (PIP) and Electronic Information Security (ELIS) standards for computer use and security of sensitive information must become a priority and be monitored in a systematic manner. 


    • A Loss Prevention Audit will be designed and conducted periodically to maintain compliance with the established standards and/or identify those managers and employees who do not understand their responsibilities or have chosen to subvert the regulations for any number of reasons. 
      • If an Audit Finding determines that the employee acted to intentionally cause a loss or do other harm to the business, an internal investigation should be conducted to thoroughly examine what occurred and identify those responsible. 
      • Action Plans and Follow-Up Audits should be utilized consistently to increase procedural compliance, help deter negative activities and keep the awareness level high for possible issues. 


    There is substantial legal precedent which demonstrates that companies who are aware of security issues and do not initiate a reasonable response have increased liability exposure. Conversely, companies that are able to demonstrate that they have, in fact, responded to security issues in the recommended pro-active manner are much better protected against such losses.

    Summit Loss Prevention Consulting appreciates being chosen for this assignment.  If there are any questions concerning this report please contact Tony Jarana.

    For more information about Tony Jarana or how Summit Loss Prevention Consulting can help your organization, Call 317-363-8312 or send email to 



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