Tag: embezzlement

How good cash registers lead to good fruit-juice

This article takes a look at two attempts at using technology to prevent corruption.


Across the road from our office is a store that sells fruit juice.  The juice is always of excellent quality when the owner is present in the store.  But whenever the owner is not present, the juice tends to get greatly watered down.

So, we began to wonder why the owner of the store was so generous with the ingredients while his employees were not (considering that they weren’t the ones paying for it).

I got the answer to the question from a friend who was familiar with unorganized food retail in India.

The friend explained to me that in shops that size, the owner would have no way of keeping track of sales.  He would come to the shop at the end of the day and calculate the amount owed to him by the quantity of nuts and fruits that had been consumed.

So, by using fewer fruits and nuts, the employees were cheating the owner of his money.

The Incorruptible Cashier

A tool was devised to prevent this kind of dishonesty, more than a hundred years ago.  It was the Cash Register.  The first cash register was in fact nicknamed ‘The Incorruptible Cashier’.

The Wikipedia says:

The first cash register invented by James Ritty following the American Civil War. He was the owner of a saloon in DaytonOhioUSA, and wanted to stop employees from pilfering his profits. He invented the Ritty Model I in 1879 after seeing a tool that counted the revolutions of the propeller on a steamship.  With the help of John Ritty, his brother, he patented it in 1883.

About.com says:

On January 30, 1883, James Ritty and John Birch received a patent for inventing the cash register. James Ritty invented what was nicknamed the “Incorruptible Cashier” or the first working, mechanical cash register. His invention came with that familiar bell sound referred to in advertising as “The Bell Heard Round the World”.

It is possible that cash registers haven’t caught on in India because modern cash registers need electricity, and most small shops don’t have round-the-clock electricity.

That is probably why small retailers in India usually don’t succeed in expanding beyond more than a couple of stores (as many as they can man with close family).

So, the cash register can be thought of as a scalability tool as much as a recording tool.

Now, on to another piece of technology used to prevent corruption more than a hundred years ago.


In the early years of the telephone, callers would call the exchange and ask to be connected to someone they needed to speak to.

The operator at the exchange would then have to manually identify the callee and complete the connection.

The Wikipedia has this to say about the Strowger switch:

It was invented by Almon Brown Strowger, and first patented in 1891. …  According to some accounts, Almon Strowger, an undertaker, was motivated to invent an automatic telephone exchange after having difficulties with the local telephone operators, one of whom was the wife of a competitor. He was said to be convinced that she, as one of the manual telephone exchange operators was sending calls “to the undertaker” to her husband.

If the story were true, then the Strowger switch can also be thought of as a tool to prevent man-in-the-middle corruption.

Man can learn from the Machines

What is interesting is that in both cases, the fraudulent activity becomes possible only because of the presence of a man in the middle – the cashier in the case of the Cash Register, and the telephone operator in the case of the Strowger Telephone Exchange.

In each case, the mitigation strategy involved either the elimination of the man in the middle, or the reduction of discretionary powers of the man in the middle.

It is possible that similar methods might be employed in reducing corruption in government as well.

For example, one solution to the problem of corruption in governments and bureaucracies might be a form of direct democracy, in which the key operational decisions affecting a locality, like the choice of road laying firms, are made by the local citizens themselves (elimination).

Another solution would be to deploy a tender management system such as the one we proposed in an earlier post, which would enforce fairness in selection procedures (reduction of discretionary powers).