Employees steal millions from big four

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Governing weaknesses within Australian financial institutions are allowing huge amounts of money to go walking out the door – with employees.

A new report Employee Fraud in Australian Financial Institutions, shows employees have stolen more than $200 million from the nation's financial institutions in the past 13 years.

It found there were 120 cases of fraud by workers nationwide since January 2000 – and 69 of the victims were the big four banks.

Five of the total cases involved at least $10 million being stolen. The largest amount was $45.3 million, taken by a female financial sector employee in NSW.

“The sums of money that were stolen from some of the financial institutions were incredible…The ease with which perpetrators in many institutions stole from customers is very concerning,” said the report’s author, Brett Warfield of forensic accounting firm Warfield & Associates.

The most common type of fraud committed was employees stealing funds from customers' bank accounts and term deposits, or creating false loans.

In the 120 instances, 24 were uncovered by fellow staff and 20 by customers of clients.

The need to feed a gambling addiction the motivation for more than half the 123 people caught.

It is clear that educating staff about the warning signs of fraud – including recognising a fellow employee has a gambling problem – and fraud risk mitigation strategies were absent in many of the reported cases, said Warfield.

Key findings:

  • $217,266,481 was stolen
  • 68 of the perpetrators were male and 55 were female
  • Perpetrators ranged in age from 20 to 60 years old
  • 92% of perpetrators acted alone
  • At least 30 of the perpetrators had been employees for 10 or more years before they offended
  • At least five perpetrators had prior criminal histories for deception-related offences
  • One in six of the frauds took more than five years to discover.