A local law enforcement officer notifies the bank compliance officer that he is working on an insurance fraud scheme that appears to be running transactions using the account of a bank employee. The law enforcement officer refers to a kiting suspicious transaction report filed by the compliance officer and requests further information.
What action should the compliance officer take?
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A. B. C. D.D
In this scenario, the compliance officer has received a request from a local law enforcement officer who is working on an insurance fraud scheme that appears to be running transactions using the account of a bank employee. The officer has referred to a kiting suspicious transaction report filed by the compliance officer and requests further information.
In response to this request, the compliance officer should follow the bank's established policies and procedures for responding to law enforcement requests. The compliance officer should confirm the identity of the law enforcement officer and ensure that the request is legitimate by verifying that it is in writing and contains a legal basis for the request, such as a subpoena or court order.
Once the compliance officer has confirmed the legitimacy of the request, they should provide the information requested to the law enforcement officer promptly and in accordance with applicable laws and regulations. It is important for the compliance officer to be cooperative with law enforcement while maintaining appropriate confidentiality and protecting the bank's interests.
In this specific scenario, option D, providing the information to law enforcement in response to a formal written request, is the correct answer. This option allows the compliance officer to comply with the law enforcement request while ensuring that the request is legitimate and made in accordance with applicable laws and regulations.
Option A, informing the board of directors, may be appropriate in some circumstances, but it is not necessary or appropriate in this scenario, as the law enforcement officer has already identified a potential fraud scheme and requested further information. The board of directors should be informed of the matter only if it is necessary to do so based on the results of an investigation.
Option B, calling the employee and demanding an explanation, is not appropriate because it could compromise the investigation and potentially alert the employee to the investigation.
Option C, allowing immediate access to the bank's documents, is not appropriate because it could potentially compromise confidential customer information and the bank's interest. The compliance officer should provide the requested information to law enforcement through established channels and after verifying the legitimacy of the request.