The Financial Supervisory Commission (FSC) yesterday fined Mega International Commercial Bank (兆豐銀行) NT$6 million (US$194,584) for failing to detect that one of its financial consultants had stolen more than NT$60 million from her clients over the past seven years.
“It is unacceptable that the state-run lender did not find out about this incident until the seventh year,” Banking Bureau Deputy Director Sherri Chuang (莊琇媛) told a news conference in New Taipei City.
“However, given that it dealt with the problem quite quickly [once it became aware of it], we decided not to impose the maximum fine of NT$10 million,” she said.
As the lender failed to detect the malfeasance, even though it set up three lines of defense for risk management, it should improve its internal control and audit system to protect consumers’ rights, Chuang said.
The bank has made a preliminary improvement plan, including routine job rotation for financial consultants and stricter monitoring, she said.
One of the state-run bank’s financial consultants, who worked at the bank’s branch in Taichung’s Fengyuan District (豐原), had siphoned money from her 14 clients’ deposits from January 2011 to May last year, Chuang said.
The consultant stole a total of NT$63.4 million, with each client losing an average of NT$4.52 million, the commission said.
Taking advantage of her clients’ trust, the consultant had the clients sign and stamp blank withdrawal slips, which allowed her to withdraw money freely without their passbooks, Chuang said.
The theft was not detected for years, as the clients were not accustomed to checking their bank balance routinely, until one client last year found that his bank balance was NT$100,000 less than expected and reported it to the bank, the commission said.
“This is immoral and illegal behavior commonly seen between financial consultants and their clients. We urge consumers not to sign any blank withdrawal slips,” Chuang said.
The bank fired the consultant and repaid the clients, while the consultant was charged by prosecutors with breaches of the Criminal Code, the Money Laundering Control Act (洗錢防制法) and the Banking Act (銀行法), the commission said.
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