Pub. 9 2014-2015 Issue 1

www.nebankers.org 16 Extraordinary Service for Extraordinary Members. A CUSTOMER WHO REGULARLY makes business deposits through the bank’s night de- pository claimed that on the 15th of last month, in addition to his regular business deposit, he also made a cash deposit of $2,000 to his personal account. When his wife opened the bank statement, she had immediately noti- fied the bank that they had not received credit for the deposit. His wife explained that she had given him the cash to deposit from funds she had collected in a weekend art sale. A review of the customer’s account showed an ATM withdrawal of $300 at the local casino on the 15th of last month. When this was mentioned, the wife gave her husband an accusing look. Is the bank likely to have liability for the allegedly missing $2,000? Did the bank use proper dual control pro- cedures? The bank checked the night deposi- tory mechanism and determined that it was working properly. If an envelope or bag had jammed in the slot, the deposi- SECURITY OFFICER’S BY-WORD Night Depository Safe Dual Control Charles M. Towle, President, Kansas Bankers Surety Co. tory door could not have been reopened by the next customer. The anti-fishing mechanism was working properly. The bank also checked tomake sure nothing had become lodged in the chute. The bank had written dual control procedures. The bank did not have both a key and combination lock, so it had instigated dual control by having certain employees know only the first two digits of the combination and other employees know only the last two digits. Under this arrangement, it was impossible for any one person to open the night deposi- tory safe prior to the official opening of the safe. The safe combination had been changed six months ago when an em- ployee left. All employees confirmed that they did not have the combination written anywhere. The bank did have the written combination stored in the bank’s main vault in an envelope. Both parts of the combination had been written on separate papers when the combination had been reset. The papers had been placed in a sealed envelope. The two employees had signed across the seal with their names and the date. The bank determined that this envelope had not been opened. The bank also required the use of a log book in which the employees re- corded information about each bag or envelope as it was removed from the night depository safe. Both employees had initialed each entry. The employees confirmed that each day, as the vault was opened by two employees, one employee took the items from the safe, showing each item to the other employee, who recorded informa- tion from each envelope and bag into the log. A count was made of all of the items and the total count was recorded. The number of items logged was com- pared to the count for verification. The employees would stand next to each other as each bag or envelope was