NCB executive urges tougher penalties for ...
‘Mule accounts’ banking fraud
Published:Friday | November 17, 2023 | 12:12 AMEdmond Campbell/Senior Staff Reporter
HEAD OF Fraud Prevention at the National Commercial Bank (NCB), Dane Nicholson, is urging the Government to craft legislation with tougher penalties for persons who devise fraudulent schemes to defraud customers of financial institutions.
Citing the use of “mule accounts” by persons determined to carry out their fraudulent activities, Nicholson said that Singapore recently passed legislation to target individuals who use their accounts as beneficiaries of ill-gotten gain.
He wants the Jamaican Government to examine the Singapore model with a view to introducing a similar law.
Speaking to The Gleaner on the sidelines of an anti-fraud conference organised by the Jamaica Chapter of the Association of Certified Fraud Examiners (ACFE) at The Pegasus hotel in New Kingston yesterday, Nicholson said that any person who opens a bank account to facilitate a heist on any financial institution should be slapped with a seven-year minimum custodial sentence and or a fine of US$30,000 to US$50,000.
“What they do is work with criminals, open these accounts and have them readily available, multiple of them, in order to facilitate fraud and quickly withdraw them,” he said.
“Based on our investigation, sometimes within minutes after the fraud occurs, these guys are inside the banking halls of financial institutions waiting to withdraw the cash their cronies would have obtained either through phishing, smishing, or other fraudulent activities,” the anti-fraud expert explained.
Phishing is a form of social engineering and scamming where persons deceive others into revealing sensitive information while smishing involves the sending of fake text messages that appear to come from a legitimate source such as a bank or social media site.
Most messages have a sense of urgency and request the recipient to click on a link or reply with personal information.
Nicholson told The Gleaner that there are different tiers within fraudulent networks, with some assigned to recruit individuals to open accounts to get cash.
He noted that the persons who open the accounts get a percentage of the ill-gotten gain after the fraud has been carried out.
“The financial institution is going to close down that account, so they are going to move across financial institutions so that in some cases, one individual will open eight accounts in different financial institutions, and when they exhaust the banks, they move to credit unions,” he noted.
Nicholson said there was a direct correlation between fraud and other crimes.
“What a lot of people are not seeing is that a lot of guns are coming in, most of them not related to drugs anymore. What the guys are doing is participating in white-collar crime and once they make money, everybody needs protection – that is how these gangs are formed,” he said.
At the same time, Director of Investigations at the Major Organised Crime and Anti-Corruption Agency (MOCA), Jervis Moore, said that tougher fines may not always deter persons who want to fleece financial institutions.
He noted that there was a school of thought among those who commit fraud. According to Moore, many of these wrongdoers are intent on taking their chances irrespective of the penalties.
Moore said that MOCA is taking steps to ramp up its efficiency and effectiveness in tackling corruption and financial crimes.
“We want to be as efficient as we can to ensure that if you commit the crime you do the time,” Moore said.