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Monitoring From Afar.

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Question: 
We have an elderly customer who has a caregiver. One of the duties of the caregiver is to help the customer write checks for monthly bills. Recently, we've been concerned that the caregiver is perhaps helping herself, rather than helping the customer, because some of the checks are larger than normal and others are made out to payees that would be unusual for our depositor. We've tried talking with the customer, because we're alarmed at her rapidly decreasing balance, but she does not appear to be able or willing to stop the misuse of her funds. The customer has signed each item, but we still feel awful paying them because we believe she's being taken advantage of.The customer's grown children live out of state. We're tempted to call one of them to discuss the situation, but we can't do so because of financial privacy constraints. Any other suggestions?
Answer: 

Two suggestions, including one that makes use of your eBanking technology! One suggestion is for the current situation with this customer, and one fis or future customers. With this customer, try getting very specific. Instead of simply saying, "There have been an unusual number of large checks being written on your account", get specific amounts and payees. Reassure the customer that you are simply concerned about her well-being and that any time you notice transactions that are highly atypical it is standard practice to inquire about them, in the event they represent some sort of fraud. When confronted with very specific evidence of the possible wrongdoing, the customer may be more likely to take action.

To protect against similar problems in the future, consider encouraging such customers to give their user name and password for online banking to one (or more) of their adult children. This would allow the children to monitor the account from wherever they might be located and they could help spot -- and deal with -- irregular transactions. If you suggest this, you might want to first consider the feasibility of disabling things like online bill pay for that particular account, so that the relatives would essentially have view-only privileges and could not initiate electronic bill payments to themselves or wire transfers, etc. Sometimes the "bad guy" is a relative, so you don't want to arm a potential wrongdoer with the keys to the customer's financial castle. Simple monitoring, however, can give another level of protection to your customer, peace of mind to their loved ones, and a way out of the financial privacy dilemma to your institution.

Seem like a drastic step? You may think so until you've been involved in a situation where, after the customer's death, the relatives see the wrongful transactions and start alleging that the bank "should have known, should have done something", etc. Or you may think so until a now-destitute customer is sitting in your office devastated about her diminished account balance, wondering how she's going to survive on the small amount of money she has left.

How do you get customers to agree to do this? Educate them. Whether it's through a program you give to your seniors' group or a brochure or statement stuffer that uses examples to illustrate why it can be beneficial, give customers the facts. Let them make the choice.

First published on BankersOnline.com 7/9/01

First published on 07/09/2001

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