Syndicate nets millions from cheque scam
KUALA LUMPUR, April 5 — A local bank has reportedly lost more than RM100 million over the past few years to cheque fraud believed to have involved government agencies and bank insiders.
A financial industry source told The Malaysian Insider that account holders from private firms and government agencies are involved in cashing third party’s cheques, disclosing several cases included agencies that handle large amount of money such as the Royal Customs Department and theImmigration Department.
The National Union of Bank Employees (NUBE) said that they detected the cases after one of its members was charged for cheque fraud recently.
“It has been happening for a very long time, so the loss is estimated to be more than RM100 million,” NUBE secretary-general J. Solomon told The Malaysian Insider.
He added that NUBE was made to understand that senior bank officers were also involved in the cheque fraud.
“We understand that there are four bank officers have been suspended for cheque fraud,” he said.
The Malaysian Insider understands that the case involving the NUBE member was not a major one, compared to dozens of similar fraud detected since 2003. The bank, run along Islamic lines, has acknowledged the cases and it is understood it is taking action with the cooperation from the police and the central bank.
In the case, the Islamic bank where it detected losses of almost RM12 million after a breach of banking procedure when it cashed a third party cheque belonging to a public agency to an account for a law firm in northern peninsula Malaysia.
In one transaction, the cheque had a face amount of RM1.6 million.
The cases apparently occurred between Oct 2007 to Dec 2009. The clerk involved has been suspended pending internal investigation.
“We also received unconfirmed reports that the amount may reach RM100 million and we understand that the bank is still conducting internal investigation,” Solomon said in a statement put on the NUBE website.
“The clerks who handled the transaction under the head service centre have faced disciplinary action,” he added.
The statement was made in response to the bank’s move to transfer six clerical staff to other branches without strong justification.
It also complained about the bank management’s reluctance to pay laundry allowance of RM55 per month but at the same losing millions to cheque fraud.
I wish to add that together with electronic phishing of customers' accounts data, those in it never had it so good... like taking candies from babies! How many of us observe advice on preventing theft of identity and money? Out of those who are careful, there must be many times more those who did not bother or forgot about it after a transaction.
Then, we have Non-performing Loans or NPLs of a bank which are officially stated at say, 5%, but how true is that percentage? To make the bank look good, they are able to transfer them out to another company or sold to others. Let's say, they are just transferred, are they not similar to those 'toxic waste' as shown by giant banks in USA, Britain and lately, Ireland? Determining NPL can be subjective and be prone to management manipulation, if and when necessary, until too late and cannot be covered up.
In the context of our country's banking system, I cannot help thinking of big loans given to cronies of ruling politicians without proper documentation or collateral.
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