Moving over to the financial sector and connecting with the Chief Operating Officer for Cornhusker Bank, Steve Lindgren!
Financial institutions and their customers continue to be defrauded by increased incidents of account takeover, ACH and wire fraud incidents that have led to the theft of millions of dollars. So, how can institutions meet new requirements and improve their abilities to prevent fraud and detect and respond to suspicious activities?
Cornhusker Bank has been utilizing Awareity’s TIPS platform for over 9 years and continues to evolve and take advantage of all the system has to offer. They are leading the way and allowing all bank employees (and third-parties) to securely report check fraud and suspicious activities, as well as teller concerns, employment concerns, elder abuse, and more.
An excerpt from Rick’s interview with Steve is below. To listen to the full conversation, click here.
How is the bank using TIPS? Why did you see a need for a platform like TIPS?
We use TIPS primarily for suspicious activity, fraud, counterfeit, elder abuse. We have it set up so different individuals can access the need for filing or reporting difference incidents that happen inside the bank.
We had a disjointed reporting system that wasn’t available to all employees. TIPS is available to all employees at any level, any position in the bank, to make reports, which has increased and improved our reporting under the Bank Secrecy Act for all sorts of activities that could impact the bank, or the country and its citizens. It is a very efficient way to funnel information and research to the personnel that make decisions on reporting and filing and gives us a way of documenting why or why we did not file.
How does bank ensure all appropriate staff and service providers are notified of updates, policies, regulations, etc.?
We have our policy and identify theft training on the system as well, which is required of all employees as well, which feeds into how the information is processed through the reporting and regulatory system. It is a method of keeping current information in front of the employees and alerting them of changes in policies/procedures, contacts, any of pieces of information that are necessary for them and the bank to do their job efficiently and correctly.
You guys take advantage of this in a great way – automating documentation and annual notifications, too.
That is correct. All of the employees, unless it doesn’t particularly apply to their area, are required to do annual certification on everything, read it, review the policy, forward suggested changes and then agree to the policy that confirms they understand what their job is and how they should handle certain situations.
How is TIPS helping your bank meet mounting examination and compliance requirements?
Primarily, one of the issues I am assuming a lot of people have is things are reported and never followed up on or they aren’t documented as to their dispositions. This gives us a method for both, giving us the documentation of the incident, having the decision-making process outlined. And then we have a non-reported file that we use for examiners. We do file more documentation with BSA than we have in the past, primarily because everyone is aware of what is necessary and what is reportable. We do not tell anybody not to report anything they think is suspicious or out of the ordinary, fraudulent or abuse. That decision on how to handle that information is made upstream by other people who have the knowledge to make the determination if it should be reported to authorities.
Examiners like the system and our process. We had comments from our last BSA exam that our documentation was some of the best they had ever seen. I attribute it a lot to the ability to have the entire staff involved and input from everybody on different situations that have occurred. Practically anywhere in the bank, including the call center, the technology people, even people you wouldn’t think would have any input or touches on things that would be of a nature that is reported to authorities. Every employee has access to the training and to report incidents.
What are some of the most common incident types reported? How has TIPS helped improve your investigation efforts?
Regarding who reviews incidents, it is our Chief Risk and Security Officer and myself, as the Chief Operating Officer, that review reports that are made. I would say the majority of the reports have to do with suspicious activity, people structuring transactions that are unusual. We investigate and may get the cooperation of law enforcement. Counterfeit currently goes in there also and we do have a liaison with the local police department for that and the Secret Service can deal with it directly.
What would you say is the most valuable benefits of TIPS?
It gives you a common central reporting tool that is accessible to everybody, which is extremely valuable. The knowledge of the employees about what is necessary and information for decision-making, it really becomes a very streamlined efficient system for decision-making and the upstream end is very simple. TIPS also helps with suspicious activity reports. There is follow-up that is required for them to monitor continued activity and we use TIPS as a heads-up so we don’t miss those reporting timeframes that are required. Also allows for further research to be input in by employees or by those responsible for filing the documentation to document ongoing activity.
We do recall reports periodically if it appears to be a recurrence of something that may have been reported before. The regulators seem to be very pleased with the documentation used for their reviews. The file on things we didn’t actually report is huge with the regulators. They don’t want to overturn it, but want to see why we didn’t report it and that we are actually researching and documenting and citing incidents that happen at our institutions.
Any other comments or lessons learned you would like to share regarding TIPS?
The biggest lessons learned are how to make your process more efficient. If you don’t have a system to track and manage, you really don’t have control of the operations of those areas. We started with this program for Identity Theft. We subsequently added all bank policies and having those in a central place for all employees is valuable. And now the TIPS reporting has been extremely valuable in helping us maintain a constant, steady flow of information and share with our staff to keep everyone informed.