– In Some Cases, Banks and Credit Unions Are to Blame –
Reports of financial crimes against the elderly are on the rise. Now, a startling $3 billion is swindled from our most vulnerable citizens each year. But while many of these frauds are initiated by online criminals, family members and caretakers, far too often its trusted bank and credit union insiders that are to blame.
Yes, there are bank and credit union employees that are actively stealing from the elderly. Unfortunately, without the proper monitoring of employees and all the insider transactions they make, fraud and risk teams may only see this trend grow more devastating, and far more expensive.
Take for example the recent conviction of Lee Michael Griffin. By many accounts, Mr. Griffin was a hard-working employee and trusted bank teller at an Alaska-based credit union. However, like far too many insiders, the temptation to get-rich-quick may have gotten the best of him.
You see, for an alarmingly long time, Griffin was stealing funds from the account of an elderly credit union member. Unfortunately, this “trusted” employee’s thievery went undetected for three years as he drained $129,000 from the victim’s account.
He accomplished this insider fraud by conducting 66 separate transactions from the victims account and transferring the funds into his own credit accounts. All while nobody noticed: not the elderly credit union member and not the credit union itself.
So, who was the eagle-eyed detective who uncovered this fraud? We’ll get to him in just a moment.
First, assistant US attorney, James Osterle said of the crime, “With each execution of the scheme, he purposefully entered the necessary keystrokes to steal money he knew was not his. This crime involved not a single incident of dishonesty or one-time lapse in judgment, but rather a separate decision to steal, month after month and year after year, resulting in dozens of discrete acts of theft.
“At no time during the nearly three-year period did Mr. Griffin pause or slow the pace of his unauthorized transfers. In fact, there is little doubt he would have continued stealing but for the fact that the victim’s nephew intervened and discovered the scheme.”
After three years of draining the victims account, the fraud was finally discovered by the victim’s eagle-eyed nephew: Not by the victim and not by the credit union.
How could an insider crime like this go completely undetected for so long?
And why was it left up to the family to discover it, and not the credit union itself?
Unfortunately, Griffin got away with his crime for years, and would probably still be actively stealing money, for one simple reason…
It’s highly unlikely that the proper real-time insider fraud detection and prevention technology was implemented by the CU. In fact, it may have been relying on systems that are long outdated and ineffective.
Even today, with the proper real-time technology available and highly cost-effective, there are far too many financial institutions that still utilize legacy fraud detection and prevention systems. Systems that don’t discover or prevent transactional fraud in real-time, let alone detect insider frauds as they’re happening.
While banks and CUs using legacy systems may scour and analyze “batched data” to find any problems or discrepancies within their Core systems, batched data is generally analyzed after an insider (or outsider) has already committed fraud.
Simply put, legacy solutions are unreliable and not timely in preventing insider bank frauds, or most any bank frauds for that matter.
Moreover, many modern insider bank frauds go undetectable as insiders use real customer or member data to issue loans, issue new lines of credit, or transfer money, as Lee Michael Griffin did.
The problem is, even though fraud is being committed, these acts may seem legitimate when analyzed by fraud teams in batched data.
Fortunately, contemporary tools that are powered by artificial intelligence, like ToolCASE’s industry leading solution, RembrandtAi, can examine, in real-time, huge amounts of data points to detect any suspicious internal activity in your core banking system.
It analyzes this data as transactions are occurring and can alert fraud and risk teams of anomalies like insider money transfers, immediately… during the act.
Could RembrandtAi have detected Lee Michael Griffin’s insider crimes three years ago, before any money was illicitly transferred?
Discover the bank and credit union industry’s most advanced, real-time fraud detection and prevention system, and receive a full one-on-one demonstration of its remarkable ability to detect insider frauds, by clicking HERE.
Or call 1-888-TOOLCASE to speak with a fraud expert today.
Even your most “trusted” employees could be committing insider fraud right now…
Without your knowledge.
RembrandtAi helps you catch them in the act.
