Experts discuss concerns about security, compliance and, of course, health for in-person branch operations during the pandemic.
Donning a mask to walk into a financial institution has been “one of the weirdest experiences” that Ian Kildow has had in recent times.
Financial fraud investigative supervisor at the Colorado Office of the Attorney General, Department of Law, Denver, Kildow is much more accustomed to masks being thought of as something robbers wear. But now members in many places will be required to wear a mask to come into a branch to make a deposit.
This is just one example of the new scenarios financial institutions are facing as they reopen their physical locations in the new world that’s been created by the COVID-19 pandemic.
In the recent webcast “Reopening the Doors: Addressing Compliance, Health, and Community-Focus Areas for Financial Organizations” sponsored by Virent Systems, Melville, New York, Kildow and other experts talked about security, compliance and health concerns associated with operating financial institution branches in the midst of the pandemic.
Kildow endorsed a way to manage the mask concern. Start by having only one entrance to a branch. Outside that single entrance, ask members to remove their masks briefly and have their images captured by a security camera. Capturing a fingerprint during the transaction could also “be helpful to law enforcement down the road,” he added.
Remote fraud will also need to be managed during these times of reopening, Kildow said.
“Fear is one of the motivators that people will face in economic uncertainty,” he explained. “When their guard is down (because of that fear), it’s an opportunity for people to make quite a bit of money using the bank or banking customers.”
To combat fraud, Kildow recommended providing training to staff on such topics as social engineering and how the increase in the use of remote banking could boost fraud attempts. He expressed concern that staff could skip over key security steps in a given process because they seemed “inconvenient” to either staff or the member. To address this, training staff about why various steps are in place can be helpful.
Interestingly, Kildow said mandatory reporting for such things as suspected elder financial abuse could become much more difficult to fulfill with more transactions taking place over the phone rather than in person.
“I see that there will be a tremendous opportunity for fraudsters,” he said, noting that he has seen some “impressive” schemes over the course of his career. “Try to get out in front of them.”
In addition to training front-line staff, Kildow recommended hiring the best IT and security staffers you can and providing them with good training as well. He said his office’s efforts to thwart fraudsters over the years have been significantly aided by working with knowledgeable and capable financial institution employees.
He also recommended joining the Association of Certified Fraud Examiners, calling it a “great way to connect with the law enforcement community and get in front of these crimes before they happen.”
“Fraudsters can tell me which banks to go to and how to exploit them,” he added. “They basically will take advantage of the weak parts.”
Compliance From All Sides
The opening example of patrons now wearing masks as they enter physical branches raised a compliance concern for the two attorneys on the webcast panel. If only one entrance is available, that entrance needs to be compliant with the Americans With Disabilities Act, they said.
Sarah Auchterlonie, shareholder, and Allison Gambill, litigation attorney, for the law firm of Brownstein, Hyatt, Farber, and Schreck, Denver, said the laws that financial institutions have to follow have generally not been adapted to the advent of the coronavirus pandemic. They noted that this has left these institutions to navigate a fairly complex regulatory framework in a very complex time.
Rules like the Equal Credit Opportunity Act and, for banks, the Community Reinvestment Act, come into play when financial institutions are deciding which branches to close, Auchterlonie and Gambill said. Organizations need to pay attention to whether they are redlining when closing branches in areas largely populated by minority groups but keeping open branches in non-minority areas. This can be of special concern when looking at heat maps of areas that are most heavily affected by the coronavirus during decision-making. Those high infection areas often coincide with areas populated more heavily by minority groups.
When it comes to being compliant in your human resources management during reopening, a first and very big job will be to sort through the various guidelines and requirements from the federal government and its agencies, your state’s government and its agencies, and local authorities, Auchterlonie and Gambill said. Notably, not all of these guidelines will dovetail nicely.
The two attorneys also offered the following key questions to ask about human resources management at a physical financial institution location today:
- How are you going to set things up for social distancing? Will you have plexiglass dividers? Markings on the floor every six feet?
- How will you fulfill temperature and wellness check obligations? Will you ask employees to do this at home before they come in or will it be handled at the branch? Many companies are asking that patrons wanting to enter demonstrate that they are monitoring their health as well.
- How will you manage traffic flow to reduce exposures and contamination? Will you designate one door for entering and another for exiting? Will you have a one-way flow of traffic inside the branch?
- How will you handle protective equipment? Will you provide face masks for employees? Will you have someone at the door to make sure everyone is wearing a face covering before coming in? What’s the option going to be if someone doesn’t want to wear or can’t wear a mask?
- What will you do if someone does get sick? How will you identify and isolate sick employees? How will you differentiate your response based on whether an employee was exposed, has tested positive or is starting to exhibit symptoms? When can employees return to work in each of these scenarios?
- Who will be your dedicated contact person for COVID-19-related questions?
Auchterlonie and Gambill recommended doing a review of all of your employee policies, as they may now be out-of-date in the new environment. They also advised drafting COVID-19-specific policies, such as a return-to-work policy that would explain to employees what’s expected of them in general and in specific cases, such as if they would test positive for the virus.
Lisa Hochgraf is senior editor at CUES.