Bankers Gone Bad: Financial Crisis Making The Threat Worse

Bankers Gone Bad: Financial Crisis Making The Threat Worse
Bankers Gone Bad: Financial Crisis Making The Threat Worse 

By Kelly Jackson Higgins
Oct 05, 2009

A former Wachovia Bank executive who had handled insider fraud incidents 
says banks are in denial about just how massive the insider threat 
problem is within their institutions. Meanwhile, the economic crisis 
appears to be exacerbating the risk, with 70 percent of financial 
institutions saying they have experienced a case of data theft by one of 
their employees in the past 12 months, according to new survey data.

Shirley Inscoe, who spent 21 years at Wachovia handling insider fraud 
investigations and fraud prevention, says banks don't want to talk about 
the insider fraud, and many aren't aware that it's an "epic problem."

"There needs to be more training around this issue," says Inscoe, who 
co-authored a book about bank insider fraud called Insidious -- How 
Trusted Employees Steal Millions and Why It's So Hard for Banks to Stop 
Them [1], which publishes later this month. "We are seeing a huge 
increase in this country of organized crime rings threatening 
individuals who work in financial institutions and making them [commit 
fraud on their behalf]," she says.

Meanwhile, according to a new survey by Actimize, nearly 80 percent of 
financial institutions worldwide say the insider threat problem has 
increased in the wake of the economic downturn. "A significant number of 
folks are being impacted more than a couple of years ago," which is when 
the last survey was conducted, says Paul Henninger, director of the 
financial crimes product group at Actimize. The Actimize survey found 
that only 28 percent of financial institutions had not suffered an 
insider breach in the past 12 months. 



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