Sector / Industry
Banking and Finance
Lending
Examples:
- Compromised bank staff solicit advantages from customers for approving unqualified loans or credit facilities.
- Compromised bank staff accept advantages for expediting loan applications or extending the loan repayment schedules.
- Compromised bank staff accept advantages from loan applicants for writing favourable site inspection or assessment reports.
Customer portfolio management
Examples:
- Unscrupulous staff solicit bonuses or commissions from clients for managing the clients’ investment portfolios.
- Compromised sales staff accept advantages for favouring particular clients when allotting or distributing shares.
- Compromised staff accept advantages for providing price quotations and investment advice not normally offered to customers.
- Financial analysts accept advantages for preparing and publishing favourable research or valuation reports on particular stocks.
Handling of confidential information
Examples:
- Compromised staff accept advantages from outside parties, e.g. debt-collecting agencies, to conduct unauthorised checks on customers' personal data.
- Bank staff collude with mortgage brokers to deceive referral fees from the banks by diverting mortgage loan businesses to mortgage brokers without customers’ knowledge.
- Unscrupulous staff take advantage of advance knowledge of pending orders from the clients and deal in securities for their own accounts.
- Securities staff misuse price sensitive information to induce transactions and manipulate the stock market.
Misappropriation of funds
Examples:
- Unscrupulous staff furnish false information for the realisation of funds of credit facilities.
- Unscrupulous staff use bogus instruction notes or documents to embezzle funds from bank account of clients.
- Securities brokers misappropriate shares of clients.
- Business directors deceive sub-underwriting commissions in relation to rights issue, open offer and share placement exercises.
Money laundering
Examples:
- Compromised staff accept advantages from unscrupulous businessmen for opening bank accounts without sufficient supporting documents.
- Compromised staff accept advantages from clients for facilitating money laundering activities through transactions in bank or investment accounts.
Conflict of interest
Examples:
- Bank staff approve application for loans, letters of credit, mortgage, credit cards, etc. submitted by relatives or close friends.
- Procuring staff approve tenders or quotations submitted by relatives and close friends.
- Staff develop private business relationships or engage in private financial dealings with clients.
- Investment representatives recommend clients to invest in companies in which they have financial interests.
- Staff of research department write market research reports in favour of companies in which they have interests.