Did IT Cause 7-Eleven To Know Too Much?

7-Eleven management has always known the risks of having an all-franchisee-owned chain. To minimize those risks, they made sure that IT tracking was relentless, watching every SKU, handling every timecard, making every direct deposit. But now that many of those stores are under federal investigation for rampant immigration abuse allegations, will that IT tracking come back to haunt 7-Eleven?

When the case began, federal officials described the chain as an ally helping them to find the problem franchisees. But as federal investigators are better understanding the extent of the 7-Eleven monitoring, questions are cropping up. How the chain's systems have not detected these payroll abuses? Was it not detected because people didn't want to detect it? Sophisticated IT monitoring systems are powerful, but they also bring obligations. Specifically, obligations to draw conclusions and to take actions based on what that data suggests.

CSP Daily News was the first to report on that broader federal probe. "At play is 7-Eleven's backoffice system and who knew what when, according to several 7-Eleven franchisees who spoke on condition of anonymity," the publication reported. "'Basically, the ISP runs the store,' one operator said of 7-Eleven's in-store processing system, which manages ordering, scan data, payroll and more. The system is so sophisticated it knows how many cups of coffee are sold every day at each store, how many candy bars are sold, how many cigarettes are sold. 7-Eleven corporate is extremely involved in the day-to-day operations of the store,' the operator continued. 'With all that oversight and sophistication, it's extremely difficult to believe 7-Eleven couldn't red-flag the payroll abnormalities that is alleged to have happened.'"

Among the allegations is that the franchise owner or managers were entering and deliberately underreporting the number of hours employees were working. Additionally, they are suspected of receiving hard checks and, in some cases, cashing it, paying out a portion to the workers and pocketing the rest. CSP News quoted one attorney asking: "How does 7-Eleven's central computer system not identify that it's paying two people with the same Social Security numbers?"

For more:
- See this CSPNet story

Related stories:

7-Eleven Stores Seized By Federal Agents In Immigration Abuse Case
7-Eleven Sued Franchisee, Says That He Hid "Hundreds Of Thousands Of Dollars" Of Sales From The Chain
7-Eleven Accused Of Trying To Drive Out Franchisees, Resell Their Franchises

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