For those of you that are using Branch Capture I have a question. When the employees at the branch capture their transaction and one is out of balance are they the ones that will make the correction? My concern is because years ago we had a teller who was also a "proof" operator and our examiners did not like that as they said she could commit fraud by creating the transaction and then "proofing" it. I can see issues of the same sort with Branch Capture. Have any of you addressed this issue? I am sure there is a simple control as so many banks are doing this now.

Our balancing is done in the proof department. If an item is missing or non readable, someone from proof will call the branch and have them rescan the item.

We do the same.

Has you had a regulatoy exam where this was discussed at all?

No, we're expecting to have IT exam within the next few months, I'm sure it will be covered..I'll keep you posted.

Please keep me updated.

So tellers are not doing the corrections? Do they just scan the images and if there's an issue, operations (or proof) reviews the transaction and makes the correction? Is that correct? Right now our tellers have the ability to make corrections and I'm concerned (I'm the auditor). I'm trying to figure out the best (and easiest) way to mitigate risk and not put a ton of additional work on someone (we're a small bank).

Our tellers scan, dep ops proof (key & balance) but it something is out of balance it falls to head teller/lobby manager for research and its too much for a customer service person. IMO....

So do you send the actual documents to deposit ops? Or is that only if it is out of balance?

This was a topic discussed when my institution moved to branch capture. Ultimately, it was determined that tellers running their own work (and correcting subsequent out of balance situations) did not present significant enough risk to justify mandatory segregation.

From my point of view, the scanning function is not serving as a control. Even when work was ran by an independent individual, they were not in a position to analyze appropriateness of transactions (not the right skill set, time constraints and limited data on tickets). As long as the transaction balanced, no attention is paid to validity. For example, a teller could include an unauthorized transaction in their proof work and as long as it balanced, the proof operator/scanner would have no need to look at it.

There are several other controls available to detect unauthorized account transactions, including independent reconciliation and review of internal accounts, customer review of statements, surprise cash counts and system reconciliation, as well as automated account analysis used to identify suspicious activity.

I've been racking my brain trying to figure out a way to improve controls. You are correct, the old "proof" method wasn't a good control for catching unauthorized or invalid transactions. Thank you for your input!

When we had our FDIC audit, the examiner said a teller should not scan their own work in branch capture. We now have the tellers scan each other's work and corrections are done by deposit operations.

OK...reading all the above posts, I guess I am still confused. My understanding is that one of the primary selling points of teller capture is that errors (i.e., wrong account numbers, incorrectly added deposit slip balance, etc.)can be caught by the teller while the customer is still at their window and then corrected. That benefit is eliminated though if the corrections have to be done in deposit operations. What am I missing?

Here, tellers scan each other's work and they can make corrections.

It all depends on your bank's process. Some banks have a branch scanner and all the branch is responsible for is to ensure the scanned batch is complete and the batches have been transmitted to the central aggregator, where the R/T, acct number, amount and other on-us field information is read and corrected. Some bank branches have that correction function at the branch. Some have item capture terminals at each teller window. This is why you'll see different internal controls based on how the process works at your bank.