Answer:
I have heard of these programs having some success. In the cases I have seen either a company was employed or an employee not known to the branch was used. In one case, a hidden camera was used. It was interesting to see how the transaction transpired and how the mystery shopper provided cues that should have triggered cross-sales and up-sales. It was educational and practical. What you don't want to do is embarrass the employee.
There are no real compliance considerations as this is a "closed-loop" educational transaction for evaluation purposes. If anything, it could be part of an audit to verify that disclosures are made as your procedures require.
Compensation to the shopper must be documented and reported. In many cases an external shopper is a contract employee and a 1099-MISC is reported when $600 or more is paid for the services. If a bank employee is used, any added compensation would added to normal W-2 reporting.
First published on BankersOnline.com 8/10/09
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