We are researching ways in which employees can report suspicious or fraudulent activities within the bank (employee fraud). Currently they are instructed to report it to the bank president, but we feel that we may have more tips if employees could do this anonymously. What procedures do other banks have in place for "whistle-blowers"?
The Association of Certified Fraud Examiners (www.cfenet.com) recently released its 2002 Report to the Nation -- perhaps the most comprehensive study regarding occupational fraud that you'll find. You may download the full report -- without charge -- at ACFE's website.
The report reveals that companies who used an anonymous reporting service ("We Tip" or other similarly-named organization) reduced their occupational fraud losses by about 50%.
Regarding internal reporting, an employee who suspects that another employee or an insider is involved in suspicious or illegal activities should report his/her suspicions to the: 1. Security Officer; 2. Auditor; or 3. Human Resources Manager.
These three (3) positions are the only ones within the institution that have an expressed or implied "secrecy" provision and the responsibility to act. Information reported to these persons should be treated as confidential and documented. This process should also be addressed during every employee's and insider's orientation.