I am auditing the debit card area. What are some procedures out there for dealing with cards and PINs that are returned to the bank not deliverable as addressed? Are any of you having the cards sent back to the card issuing company and if so, what are your safeguards there.

The procedure that we use is that all undeliverable (returned)mail, regardless of the type, is sent to the audit department unopened. This internal control helps prevents the chance of internal fraud by employees. Also, if an ATM/Check card is captured by the machine or a new card is ordered and sent to the bank, it is always sent to audit to pickup, not to the Transfund clerk or a new accounts rep. This creates some dual control over the issuance and acceptance of the cards. The customer has to sign a form stating that they have reviewed their account history since the ATM card was last used to ensure that there was no unauthorized activity and that they have taken possession of their new card.

I forgot to mention in the prior post that all of these "returned" cards are logged and kept in a locked box in a locked cabinet only accessible by the auditor and assistant auditor. The assistant auditor makes contact with the customer upon receiving a returned card to make arrangements for the customer to pick up the card. The customer must come into the bank to pick up the card and a valid ID must be presented at that time or they don't get the card. Hope this helps.