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#1540265 - 04/25/11 05:49 PM Employee Accounts
RBanker Offline
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Austin Texas
Not a frequent peruser of this thread - I did do a search under 'employee accounts' but did not find anything helpful.

Any suggestions on how to audit employee accounts - we're a small shop, less than 20 officers and staff. Frequency?

Thanks
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#1540287 - 04/25/11 06:13 PM Re: Employee Accounts RBanker
CARM9 Offline
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When our primary regulator would perform a safety & soundness exam they would go back 3 months for directors and executiv officers. Our auditors would look at the prior 3 month period from their exam date. They looked for transactions that appeared suspicious; like kiting, looked at overdrafts for officers and directors, they would also check to see if the employees had performed any maintenance or transactions to their own accounts, etc.

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#1540346 - 04/25/11 07:20 PM Re: Employee Accounts CARM9
RBanker Offline
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Thanks CARM9
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#1540433 - 04/25/11 08:42 PM Re: Employee Accounts RBanker
MDsbpc Offline
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We have an Executive Officer look at all employee accounts on a monthly basis, for suspicious activity. All employee accounts cut on the same day, so that makes it easier.

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#1540435 - 04/25/11 08:43 PM Re: Employee Accounts RBanker
TheQueen Offline
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Are you referring to all employees or just Reg O Officers?

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#1540455 - 04/25/11 09:24 PM Re: Employee Accounts TheQueen
RBanker Offline
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Being a small bank (less than 20 employees), we are expected to review all employee accoutns as a risk management review.
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#1541219 - 04/26/11 08:44 PM Re: Employee Accounts RBanker
Happy Drugs Offline
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Central Texas
We are a smaller bank, but do have branches so that puts us at like 70 something employees. I send out a form each year for them to give me updated account information (or any account they are an authorized signer on). I have a spread sheet I use and I go through it and basically I pull statements for at least 6 to 7 months and review it for any thing suspicious, kiting, frequent cash deposits and the amount size, does this person a teller and are they frequently short and now they are putting money into their account several months later!!! This may not be the greatest way to do this and I hope to eventually find something else that is more doable!!!
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#1541296 - 04/26/11 11:12 PM Re: Employee Accounts Happy Drugs
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We put together a query that picks up each insider account (defined as "you work here in some capacity"), included any related accounts, and we get the number of credits and debits plus the amount of debits and credits that ran through each account in the last month. We look at the entire list, but focus on the accounts that stick out and pull our focus. If someone has 2 deposits per accountholder that roughly equal their payroll, we don't get excited. If we see 15 deposits, it's a different story and we start pulling source documents and statements. It's worked well for several years. We explain it to the Fed as a tiered review system that looks at every employee and officer each month. The first tier eliminates the majority as "expected activity", the second tier identifies accounts that have excess activity that we take a closer look at. The most common thing we find is employees that are using payday loans to make it - we give the info to an EVP that has a motherly chat with them to find out how they're planning on digging out of the hole they're sinking into and helps them brainstorm a plan. It lets them know we're watching. If we see an odd transaction, we handle it case by case. That said, we've got very strong Reg O controls that are monitored daily by the Operations Dept. The nice thing about the query is that we only pull docs on the accounts that jump out and make us say "Hmmm..." There's nothing sacred about the 15 deposit trigger. We might pull docs much quicker based on the total dollar amount going through the account or just a surprising increase in activity.
Last edited by HMS Hawkii; 04/26/11 11:13 PM.
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#1541408 - 04/27/11 01:22 PM Re: Employee Accounts HMS Pippii
Happy Drugs Offline
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I like what you have in place HMS...I probably spend more time on this than is necessary and I just carried on with the previous auditors auditing ways.
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#1541541 - 04/27/11 02:36 PM Re: Employee Accounts Happy Drugs
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We are a very small shop with 9 employees. I have a spreadsheet with each employee and any account they are related to or any account they are a signer on. I check a different employee each month. I pull images of the statement and look over them. If I see anything that looks suspicious, I investigate further. I did have one employee I kept a closer eye on, but she left about a year ago.

Employees are aware their accounts are reviewed, but they do not know who or when.

Examiners & Auditors have been okay with it so far. EVP looks over my accounts.
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#1541689 - 04/27/11 03:55 PM Re: Employee Accounts PStateBank
*W*W* Offline
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To anyone: Do you report your employee and Reg O officer account reviews to a committee?
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#1541791 - 04/27/11 05:01 PM Re: Employee Accounts *W*W*
Tater Offline
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We issue a written report to our Audit/Trust Audit Committee of the Board (OCC Bank) that summarizes how many accounts we looked at and if there were any causes for concern. Other than that, no.
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#1542152 - 04/27/11 08:10 PM Re: Employee Accounts Tater
Tennismom Offline
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How to audit emplyee accounts? Don't allow employees to bank where they work.

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#1542237 - 04/27/11 09:54 PM Re: Employee Accounts Tennismom
RBanker Offline
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Thanks tennismom, but that's not really an option, and doesn't answer my original question.

I understand some institutions operate that way - we do not, and I'd rather the thread not get bogged down on that specific topic.

Thanks
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#1542238 - 04/27/11 09:55 PM Re: Employee Accounts RBanker
RBanker Offline
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*W*W* - our director and officer accounts are reviewed by an independent third party auditor....as part of their controls audit. That information is reported to the Audit Committee
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#1542261 - 04/27/11 10:54 PM Re: Employee Accounts RBanker
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Thanks R Banker. That's what I wanted to know.
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#1542598 - 04/28/11 03:53 PM Re: Employee Accounts *W*W*
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*W*W* - If I find anything, I report it to the president, and he addresses the situation as he sees fit. I keep a log of what I review and if anything is found along with when I notified the president.

Our external auditors review the log and employee accounts also. They haven't had any issues so far.
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#1581374 - 07/21/11 08:55 PM Re: Employee Accounts PStateBank
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I'm looking at roughly 40 employees, some with multiple accounts for the following activity:

Deposits outside of normal payroll dates
Excessive nubmer of deposits
Even-dollar deposits
Frequent NSF activity
Changes to OD Protection limits
Unusual postings to account
Use of p.o.box address

I'm doing monthly reviews of all employee accounts. It's very time consuming. I'm wondering if i need to narrow my review. I pull reports and compile my information onto a spreadsheet. Is this overkill? Any suggestions?
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#1581468 - 07/21/11 11:06 PM Re: Employee Accounts *W*W*
Utahn Offline
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I look at approximately 45 employee accts on a daily basis. I pull a query each morning that identifies all deposits other than payroll (tran code driven). Each deposit is tracked on a spreadsheet with the source of the funds documented. It sounds like a lot of work, but really isn't because internet transfers, ACH deposits (spouse pay), etc are easily identifiable so no other research is necessary. If deposits become suspicious, then other transactions are reviewed. Findings, that include a management response if there's a problem, are reported on a monthly basis to the Audit Committee of the Board.

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#1581490 - 07/22/11 04:57 AM Re: Employee Accounts Utahn
rlcarey Online
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Jeez - what a waste of time. Can you imagine a bank with thousands of employees employing these types of methods???? If they don't have too, why would a small bank implement such draconian monitoring efforts.
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#1581543 - 07/22/11 12:59 PM Re: Employee Accounts rlcarey
osucpa Offline
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We use some specific BSA program tools to review employee accounts. I do not spend a lot of time in this area.

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#1581593 - 07/22/11 01:39 PM Re: Employee Accounts osucpa
Hobbes Offline
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Originally Posted By: osucpa
We use some specific BSA program tools to review employee accounts. I do not spend a lot of time in this area.


Same here.
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#1581608 - 07/22/11 01:48 PM Re: Employee Accounts osucpa
*W*W* Offline
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what tool(s) are you using?
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#1581625 - 07/22/11 02:06 PM Re: Employee Accounts *W*W*
Happy Drugs Offline
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I have 75 employees, but after you pull in all the accounts they own or are authorized signers on I am looking at several hundred accounts. I have a spread sheet, but honestly I don't have time to look at this all the time. I guess I really do more of spot checks.

I would have to say this is one of my lowest priorites! I might would check more if new accounts would code these accounts better than what they do (I find they don't always get employee,officer on them all like they should!
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#1581858 - 07/22/11 04:36 PM Re: Employee Accounts *W*W*
Hobbes Offline
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Originally Posted By: *W*W*
what tool(s) are you using?


We use Patriot Officer as our BSA software.
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