Fry's Loses Big

We've spent a lot of attention in the last few years to issues of "business governance" and "regulatory compliance." These often seem like overbearing oversight but then from time to time the significance of the issues jumps out. Take Fry's for example, an interesting and unique retailer that employs lots of low wage workers selling high tech. Just like someone running a coffee shop or bar, there are lots of processes in place to make sure these employees and their customers don't skim a little off the top to supplement their meager wages. I recently returned a hard drive in the factory shrink wrap, and discovered that Fry's removes the shrink wrap to make sure that the devious customer hasn't neatly concealed a scam of some sort. There are lots of checks and balances to make sure that nothing easy gets through. Unless of course you're the VP of merchandising and have a gambling problem in which case it seems roughly $100M slips through the cracks. Fry's isn't a public company, and if it was it's hard to imagine that this could have happened because clearly their "business governance" had holes large enough to drive large trucks full of cash through. You have to wonder whose brother in law was auditing the firm and whether they even had a CFO. Regulatory compliance is just a big word until you see something like this up and close.