There were allegations of many phantom employees in the Police Dept in New Orleans, which made news about a decade ago, you may recall.  Its done, for example, by supervisors who approve time records, and then are the same ones handing out the paychecks.  Pocketing their own checks, plus the fake employee's checks. 

Nothing personal in my comments here.  Sorry if this seemed to be.  

And yes -- I understand the examples you've mentioned.  How you were raising the red flags, calling for better administrative controls over soaring labor costs, attempting to overcome the losses.  Good efforts.  But no one was able to stem that tide of F&B losses.

Tom