The Jamaica Bankers’ Association (JBA), the police, and the Bank of Jamaica (BOJ) all say they have no evidence that $35 million has been stolen from a financial institution in St Ann by an employee.
They were responding to Jamaica Observer queries following a media organisation picking up and publishing a social media claim last week that a female worker had walked out with $35 million and had taken a flight to Canada.
“We looked into this matter in great detail and found no evidence to support these allegations,” Jamaica Bankers’ Association Anti-Fraud Committee Chair Dane Nicholson told the Sunday Observer on Friday.
“We are deeply concerned as an association by false or unverified reports that can cause unnecessary panic and alarm among customers, investors, and other stakeholders,” added Nicholson, who is also manager of special investigations in the Fraud Prevention Unit at National Commercial Bank.
The St Ann police have steadily maintained, when asked, that they have had “no formal report to any of the stations in the parish”. In a written response to questions from the Sunday Observer, the BOJ has been similarly unable to shed light on the rumoured St Ann case but has provided general comments about its role in the handling of similar issues.
Deposit-taking institutions (DTI) are required, under the Banking Services Act (BSA) to immediately notify the BOJ of “any fraudulent or criminal activity committed by or against the licensee or any other member of the financial group”.
While pointing out that Section 39 of the BSA prevents it from “speaking on specific matters” the BOJ noted that DTIs have generally followed the rules in reporting issues that arise. Section 39 mandates that the BOJ should be immediately notified of instances of fraud.
“Typically, for frauds which are over $1 million that is interpreted as the same day of the event. For frauds which are less than $1 million, deposit-taking institutions are permitted to compile the events in a report to the Bank of Jamaica on a monthly basis via a specified reporting form,” said the BOJ’s Financial Institutions Supervisory Division.
While fraud is a criminal matter and investigations therefore fall “outside of the remit of the BOJ”, the bank understandably takes a keen interest in the outcome of these investigations. It has to be told if any “director, officer, substantial shareholder, or key employee” of an entity to which it has provided a licence has run afoul of the law. It also keeps a watchful eye on the funds held by DTIs, including any fallout from fraudulent activity.
Globally recognised standards on minimum capital requirements have built-in safeguards that require institutions to hold capital in case of operational risk exposure — such as fraud.
“This ensures that while the licensee pursues justice through a criminal investigation, they remain adequately capitalised so that financial soundness is preserved,” the BOJ explained.
It also has the authority to make sure financial institutions put measures in place to prevent a recurrence of fraud.
“Section 109 of the BSA gives us the power to enforce actions on licensees to ensure that the breakdown/gaps in their control environment which may have facilitated these fraudulent activities are appropriately addressed,” it added.
The BOJ pointed out that, while there is nothing in law that says it has to “disclose entity specific information to the public” in the interest of transparency it does touch on “fraud events” in its annual financial stability report (FSR).
Since the story about the rumoured $35-million hit began making the rounds on social media, questions have swirled around the identity of the alleged employee, name of the institution, and whether it was possible to walk out with so much cash without anyone noticing.
One Sunday Observer source who works in the financial industry noted that, vault access typically requires authorisation from more than one employee.
The rumour comes on the heels of several recent high-profile cases of alleged financial impropriety.
Olympian Usain Bolt is among about 40 people out of pocket because of fraud at investment firm Stocks & Securities Limited (SSL). Former SSL wealth advisor Jean-Ann Panton has been slapped with multiple fraud related charges in connection with that case. She remains behind bars after her second court appearance on Friday.
Also before the courts is Khadene Thomas, who has been accused of stealing US$279,000 from clients of NCB’s St Ann branch. Also a wealth advisor, she is out on $5-million bail until her next court appearance on May 10. Thomas has maintained that she is innocent.
Meanwhile, strict bail conditions were put in place on Tuesday when three employees and a former colleague appeared in court to answer to allegations related to the theft of $65 million from the US-dollar accounts of six of Sagicor Bank’s customers. The accused — Tishan Samuels, Malika McLeod, Alysia Moulton White, and her sister Trecia Moulton — are facing multiple counts of larceny as a servant and conspiracy to defraud.