Our internal auditor says that the bank's failure to have any surveillance cameras installed in the drive-thru lanes at one of our branch locations may be a violation of the Bank Protection Act. Branch Management wants him to "advise definitively whether this is a violation" and his "recommendation will be taken into consideration". He asked me to provide him with some guidance. According to the reg each bank is required "to adopt appropriate security procedures to discourage robberies, burglaries, and larcenies and to assist in identifying and apprehending persons who commit such acts". What more information can the auditor provide to branch management? How can he be more definitive? In addition, could the bank be sued if an employee or customer were hurt in the event of a robbery at the drive-in, given that the bank does not record activity in it's drive-in lanes? Any suggestions on how the internal auditor should respond to branch management? Thanks!

Scenario 1, customer makes withdrawal at the drive up. A person runs up, snatches the money and runs.

2. Bad checks were passed at the drive up. The teller tape identifies the time and place.

Would a tape help, sure. Is a tape definitively required, it doesn't say that. If the scenarios seem too far fetched and have never happened in your area, perhaps that money would be better spent elsewhere.

Because adequate security precautions are so common, hard and fast rules are not written in the reg as specific requirements to this detail.

Andy's comment about what has/hasn't happened in your area is good. I'd like to take it one step further and suggest you find out what your neighbors are doing. If drive-up lane cameras are the 'standard' for your area, you may be hard pressed to defend a cost-based decision before a jury. Rather than ask, In addition, could the bank be sued if an employee or customer were hurt in the event of a robbery at the drive-in, given that the bank does not record activity in it's drive-in lanes? ask if the bank could win any such suit.

Here's the quote from the Reg / Act:

(c) Security program. (1) The security program shall:
(ii) Establish procedures that will assist in identifying persons committing crimes against the institution and that will preserve evidence that may aid in their identification and prosecution. Such procedures may include, but are not limited to: maintaining a camera that records activity in the banking office; using identification devices, such as prerecorded serial-numbered bills, or chemical and electronic devices; and retaining a record of any robbery, burglary, or larceny committed against the bank;

-CITE-
12 USC Sec. 1884 01/02/01

-EXPCITE-
TITLE 12 - BANKS AND BANKING
CHAPTER 19 - SECURITY MEASURES FOR BANKS AND SAVINGS ASSOCIATIONS

-HEAD-
Sec. 1884. Penalties for violations

-STATUTE-
A bank or savings and loan association which violates a rule
promulgated pursuant to this chapter shall be subject to a civil
penalty which shall not exceed $100 for each day of the violation.

-SOURCE-
(Pub. L. 90-389, Sec. 5, July 7, 1968, 82 Stat. 295.)

-CITE-

Here's what I'd do:

Find out what the industry standard is for the area. If something does happen and you are below standards then you have a problem, including anything from a teller sueing the bank to the insurance denying the claim.

I think it is instructive to look at how a court might analyze a premises liability case. We have a link to one in Court Watch ( the Pinnsolnneault case) that illustrates the type of evidence and testimony a court may consider in determining whether a financial institution should be held liable.

edh1701:

I believe that there's ample case law regarding several involved terms and issues:
1. Foreseeability;
2. Industry standard security practice;
3. Customer having reasonable expectation of safety based upon the presence of a security camera; and
4. Board denying spending money on security equipment on the basis of cost alone.

In addition to the reference that Mary Beth supplied, you might go to www.law.com and search for references -- or use Google to search on versions of the listed phrases. When you're done, I'd appreciate it if you'd share a synopsis of your findings on BOL.