BANK big, big loss. An “accident” which today must we witness together have hit us with a breakdown of the banking system as a result of the transaction Bank BNI letter of credit (letter of credit) with a variety of irregularities fictitious bank operating procedures. Luckily, the government guarantee program (blanket guarantee) has not been released so that this case does not need to be made to the bank's customers and the impact of dizziness hopefully not systemic.Indonesia
START of the letter of credit (L / C) issued not from correspondent banks, the terms of the L / C is not met, the discount is done before the acceptance opening bank (bank opening L / C), up to the falsification of documents L / C is referred to as the causes that led to the breakdown of Bank BNI (see Figure mechanism L / C).
Of course, not intended to blaspheme and whack Bank BNI, the director of a local bank stating that it conceded a result of failure to apply good risk management system.
Well, if the bank for Bank BNI just sat there like this due to the risk of being hit, at least the other banks can reflect, it is crucial to quickly build an integrated risk management system throughout all levels of the business and the bank hierarchy.
Which is very alarming, these cases occur in just a matter of months, while Bank Indonesia (BI) will soon enact Regulation No. 5/8 / PBI / 2003 on the application of risk management for commercial banks, which is later than April 1, 2003, the bank had to be submit an action plan (action plan) regarding the implementation of risk management.
This risk management includes the active supervision of the board of commissioners and directors, the adequacy of policies, procedures and limits, the adequacy of the process of identification, measurement, monitoring and risk control, and risk management information system and a comprehensive system of internal control.
However, at least, there is a speck of lessons that can be taken. After the BNI case, it is hoped the debate about the importance of the application of risk-based bank management will disappear and soon should be a top priority for every bank.
Back in case of breakdown of L / C Bank BNI, if explored, in fact the culprit called fraud risk (the risk of crimes such as fraud, theft, criminal acts, corruption, and collusion) which is part of the operational risks (operational risk).
The operational risk has been recommended by the Bank for International Settlements (BIS) in The New Basel Accord (Basel II) to be included in the calculation of the capital adequacy ratio (capital adequacy ratio / CAR) of a bank.
Starting at the beginning of 2007, the bank recommended to include operational risk is to assist credit risk and market risk in the calculation of Risk Weighted Assets (RWA).
“The risk of direct and indirect loss of the resulting from inadequate or failed internal processes, people and systems, or from external events,” the BIS version definition regarding the operational risk.
In short, Bank BNI has experienced a failure of the process and those posed by fraud (fraud), either internally or externally.
Ironically, operational risk is often underestimated. Despite the fact that: “It is the first risk that banks must manage, even before they make Reviews their first loan or execute Reviews their first trade,” he echoes the first two sentences contained in the summary (executive summary) on the results of a survey by The Risk Management Association (RMA, 2000), entitled “Operational Risk-The Next Frontier”.
In short, the potential losses originating from the outside is relatively easier to define than the potential losses arising from within, such as the crime of bank employees (employee fraud).
Powered chance
Sometimes it is rather difficult to define clearly fraud. There is no legal definition of what is meant by fraud, but a clear, potentially making bank losses. But, at least, says that grazed the crime, such as theft, criminal acts, corruption, and collusion, a part of the fraud itself.
Why fraud can happen? Not least because there are perpetrators and their motivations for doing dishonesty that can be generated many causes. Obviously, if there is no “chance”, certainly there will be no fraud.
This is an opportunity which should be reduced if any of Bank BNI has a control system to the risk of fraud risk in general and more specific at this stage. Obviously, this control system must function properly.
If only our banks have started to build a risk management system, as recommended by the BI, which is a mirror of the implementation of recommendations through the BIS Basel Committee on Banking Supervision, banks presumably we'll soon find some other fraud.
Because, no matter how good the system is built and implemented risk management, fraud risk can not be lost along with the variety of human nature. After all, crime will never perish from the earth where we stand. Go back
Fraud risk is just one of the risks from a multitude of risks that must be faced by a bank. In the context of the bank's risk management, fraud risk can be defined as the exposure (exposure) faced by banks against fraud that might arise internally and externally.
It is important for banks to be able to define fraud that the bank has a good response to internal cases involving every employee.
Management “fraud risk”
Each person in the bank may commit fraud. Instead, everyone in the bank could also contribute to reducing fraud risk management itself.
Broadly speaking, to build a system to fraud risk management can be done in several stages. First, banks should be able to estimate the magnitude of fraud risk faced by the bank as a whole.
Second, further necessary to identify which areas are most vulnerable to a type of fraud that risk. In this case, the bank can perform its own risk assessment (risk-self assessment) through questionnaires, interviews, and even to do some brainstorming internally.
Then do the ranking with the various criteria for determining which areas are most vulnerable, and to identify forms of fraud in each of these areas.
Third, the system must be created reporting to the level of directors of the bank. Fourth, it is necessary to evaluate the magnitude of fraud risk faced so will provide information which areas need immediate precautions.
Fifth, after the evaluation phase, of course, banks should be able to take steps in response to fraud risk that exists. For example, by making the allocation of responsibility for specific fraud risk, creating internal controls against fraud risk with cost efficiently as possible, develop parties were given the responsibility to have the expertise to manage these risks, and effectively take action in case of fraud.
Cultural anti- “fraud”
In short, it is important for banks to build up an anti-fraud culture is grounded on all levels there. It should start from the bank officials.
The bank's internal control system must be able to create conditions in which the fraud risk is the risk that must be managed alongside other risks.
The process of creating an anti-fraud culture, for example, can be done bank by making a clear statement of ethical values, making anti-fraud policy, to build awareness of all employees against fraud, and strict sanctions. Furthermore, the bank could begin to hire employees who hold the value of honesty and continues to maintain the morale of all employees on an ongoing basis.
Bobolnya case of L / C is preventable with early detection if only the bank could arrest signals that could be identified as potential fraud, certainly with caution.
If true BNI Bank discount rate before acceptance is done by opening bank (bank opening L / C), obviously it is deviating from the principles of prudence and of course motivated by particular reasons. Clearly, the fraud has occurred and will never disappear in any activity that banks need to be wary.
Up to this point, all banks should create a solid system of internal control. This is clearly contained in the BI regulation will soon be put into effect from January 1, 2004.
And, BI as a regulator would have to take appropriate action if any internal control system of a bank is not “quite” or effective against the risk profile of the bank.
This is in line with BIS recommendations, as contained in document ditelurkan the Basel Committee on Banking Supervision, September 1998, the “Framework For Internal Control Systems in Banking Organization”.
Tedy Fardiansyah Idris, academics Observer and Financial Practitioners
