Safe Deposit Box Questions

I know this is a lot, but we’ve got unresolved, never-ending issues with the safe deposit box guard key, and I would like to know what other banks do.

How do you control the safe deposit box guard key?
Do you require the guard key to remain in the bank and be signed in/out of the vault daily?
i. If yes, how do you handle customer access to the safe deposit boxes when there is limited branch staff?

ii. If no, is the guard key issued to specific personnel, and can they take the guard key with them if they leave the bank premises?

Do you limit the number of guard keys issued?
i. If yes, how many are allowed to be signed out?

Do you allow temporary control of the guard key without signing?
i. If yes, how do you define the temporary control?

Do you utilize bank-use safe deposit boxes?
If yes, what do you use them for, and how do you control access?

In my experience, we assigned guard key to specific individual with designated backup for lunch, etc. Under no circumstances could guard key ever leave bank premises. It was secured in dual control key box nightly.

Bank use boxes were documented by contracts with specific entry instructions. We used positions rather than names to prevent having to revise contracts every time an employee left. For example, the contract might specify that two signatures were required: one branch officer or senior officer (SVP and above) AND one employee could access the box.

Does anyone else have procedures/opinions they would like to share?

Our bank's procedures are much the same as BrendaC. Our switchboard operator is also vault attendant where the boxes are kept. She keeps the guard key and lets customers in and out of the vault. She actually takes the customers key along with the guard key and opens the box door in the presence of the customer and allows them to remove the box for viewing. She removes the guard key from the door and takes it with her, leaves the customer's key inserted until ready to close. She also has a back up for lunch.

We do not leave the customer key in the box but return it to the the customer. You can nerver know if the customer will claim that you made a copy of the key when it was out of there sight.

We are a small bank with less then 100 boxes and only 5 staff total, so our key is in a central location where any employee can get to it so that they can let a customer into their box. Our Bank box must be entered under duel control. The key is locked up at night, and would absolutely never leave the bank!

You should specify in your procedures whether you have a "lock shut" or "lock open" policy when accessing a safe deposit box. I prefer a "lock shut" policy to prevent a customer from putting his tin in a box and walking out with the safe deposit box door left swinging.

I recommend escorting the customer into the vault, opening box, allowing customer to retrieve tin, locking door shut, and returning key to customer. Attendant would assist in reopening box for customer upon exit.

A guard key should NEVER be left unattended. Someone could make an impression of the key and make their own guard key for use at a time suitable to them.

Our guard key is kept under dual control overnight, but during the day it's in a locked drawer where every trained employee can access it when we get a customer needing into their box. We have thousands of boxes and when a customer calls, we have them sign in on a safebox entry slip. It's dated and the time is written down and the box number is written on it. We also document identification and cross-reference with the original safebox contract to verify the customer accessing the box is supposed to. The entries are kept for a few years, how many I don't know offhand.

You have to think like a "bad" employee. What COULD someone intent on stealing from your organization do with that key? Could they make a copy of the key and somehow also get the key to a box containing cash, safekeeping items, monetary instruments? Could they enter the box containing keys to unrented boxes and make themselves keys to enter the boxes when they are rented? Consider all the alternatives, because if the guard key is available for any employee to access, eventually someone will think of a way to do something you'll wish they hadn't. Remember, we have unlimited liability on safe deposit box contents.

How so? The boxes are not FDIC insured, and the hold-harmless warrants the customer as liable for any loss.

Example, your bank burns to a crisp. The customers had better have a rider on their homeowners policy to cover SD Box contents, and they need to have a detailed list of items, values, and appraisals (as needed) if they want to get reimbursed.

Hold Harmless? Right! In court it is the "big bad bank" versus the "poor helpless consumer" if it even gets that far. With attorney fees at several hundred per hour, the bank usually rolls over.

Al

If we fail to exercise proper control over safe deposit boxes, we can be left wide open for claims of missing items. If the customer can prove he had the items and we can't prove we kept them safe, liability is on us. I believe it was a Texas bank that suffered a $5 mil loss when they let a soon-to-be ex-wife into the husband's box and bearer bonds were reported as missing.