Pub. 3 2012 Issue 2

www.wvbankers.org 10 A customer claims something has disappeared from his safe deposit box. How good are your bank’s controls? Many customers place valuables in safe deposit boxes and leave them for years. M ost customers do not keep regular inventories of their contents, relying instead on memory. emories can be imperfect regardless of a person’s age. When a customer comes to you “know- ing” that something has been taken from her box, how will you be able to respond? If your control procedures are properly designed and followed, you will know whether or not someone could have im- properly entered the customer’s box. First, the bank records should provide a signature, date and time that each box was entered. You can review these entry records to see if the customer’s signature was forged on the entry records. These records should also have been signed by anyone who accompanied the customer when the box was entered. This can serve as a reminder to the customer of who was with her when the box was accessed. This will often help when an honest customer has simply forgotten, for example, that she gave some of her jewelry to her niece. Second, the customer’s key should never be under the control of a bank employee. In some banks it has been a practice to let a regular customer leave his key at the bank so he won’t need to remember to bring it with him. Such practice must be absolutely prohibited. In one case, the customer left his key in the safe deposit room when he was done. Bank employees found the key and stuck it with the card until the customer came in again six months later. The customer claimed that coins had disappeared from the box while the bank had possession of the key. Twelve different employees had access to the key during the six month period. If a customer does leave a key in the bank, procedures should require that the key be placed under immediate dual control and that the customer be contacted immediately, so that no em- ployee is unjustly accused of accessing the customer’s box. In another case, the bank rented a safe deposit box to a man and his daughter. The daughter was not at the bank when the box was rented. The father said she would be in the next day to sign the box agreement. He left a customer key with the bank employee to give to the daugh- ter. The daughter never came in and the bank still held the key three months later when the father died. The daughter claimed that her father had told her what he had put in the box and that several of the items she believed were supposed to be in the box were missing. Several dif- ferent employees had access to the key while it was at the bank. Third, the guard key should be kept in possession of bank personnel and never given to a customer. In one bank, to avoid making a Why Do You Have Safe Deposit Box Procedures? By Charles M. Towle, Senior Vice President, Kansas Bankers Surety Company SECURITY OFFICER’S BY-WORD