Great question!

I am an attorney, and have experience from both a legal perspective and a business perspective. I hope my thoughts on the matter are helpful.

In a situation where the integrity of your business is called into question, and the trust of your customers has been shaken, you need to avoid doing anything that even hints at an appearance of impropriety. This means your approach should be as forthright and upfront as possible. No hiding the ball, and no avoiding the issue at hand. Equivocation will be seen by your customers as consciousness of guilt, or at least an attempt to sidestep the problem.

You can't do that.

I'm of the opinion that all advice needs to be clear, practical, and actionable, so I love lists. Here's one.

1. Communicate to ALL of your existing customers that an alleged criminal act may have been committed by an employee, but that you as a conscientious business owner have taken steps to insure that the alleged act doesn't happen again. Emphasize to your customers that their trust in your business to provide the service that you provide is paramount, and it is critical to you and your business that that customers be comfortable with you. This incident is an anomaly. This could be by email or snail mail.

2. Personally call all customers that have expressed an interest in getting a refund. Obviously, I don't know what business you are in, but nothing is more important in this day of faceless email and text than a personal phone call, or even face to face meeting. Emphasize that you are a person-like your customers-and that you hold their interests in the highest regard; without them, there is no business. They need to know that you above all else, you care about them. That's more important than than the money.

3. Offer the refund when asked. You hate to see them go, but if the relationship is broken beyond repair, part ways as amicably as possible. They (or their friends/relatives/associates) might be customers again down the road, and they will appreciate you handling the matter professionally.

Through it all, customers will appreciate your meeting this issue "head-on".

Take the initiative.

Feel free to request a call if you need anything.

Good luck, and good business.