How To Deal Fraud Case By An Employee At Company!

Dear Seniors,
One Of Our Employee from sales department has been caught manipulation of accounts and cheating the company. Few documents have come to light which shows the manipulation and dishonesty.
How should we handle this issue and recover company's money from him ?
Should the police complaint be filed Or any other process should be done by HRD?
Please Suggest How To Handle So that company Image is not sullied and at the Same time the message goes that one can't get away after messing around.
Please suggest, what is the HR process on this above issue from starting to end till money recover by him..

Dear Kumar,
First and foremost, order domestic enquiry. Enquiry Officer (EO) should be capable to understand the sales or accounts process. Design terms and references of the enquiry carefully. Please note that EO's job is to do the enquiry and establish facts. He/she is not supposed to recommend any punishment.
You may suspend the employee pending enquiry. On the strength of the enquiry report, you may initiate disciplinary action. Initiate recovery process. If employee refuses to pay the amount, option of police complaint will arise thereafter.
Thanks,
Dinesh Divekar