The Convenience of Corporate Crime by Petter Gottschalk

The Convenience of Corporate Crime by Petter Gottschalk

Author:Petter Gottschalk
Language: eng
Format: epub
Publisher: De Gruyter
Published: 2021-10-13T10:40:08.495000+00:00


The bank engaged EY to assist with program Athens and to provide the bank with an analysis and verification of system flaws identified by Plesner.

Examiners thus document a bureaucratic approach to solving technical problems. The manual effort required to review computer code seems ignored. The only manual effort described is concerned with actual transactions in terms of new manual controls regarding calculations for each customer. No new debt collection cases with effect from 2019 were to be initiated without manual calculation being done before. If the manual calculation resulted in different figures compared to the systems figures, then figures in the system were corrected. The bank was thus incapable of solving the underlying systems error, instead system results were corrected.

The manual correction team was 4 people but grew quickly by 21 people to further accelerate the recalculation process. Consultants from Ernst & Young were also engaged to assist with the recalculations. In addition to the new manual control to stop new cases being brought to court before a recalculation, it was late 2019 also decided to withdraw all current court cases, including debt relief cases, private and business estate and bankruptcy court cases where the bank was uncertain about the real status for customers. It was decided to compensate all customers for their losses resulting from the identified root causes. To further minimize the risk of overcollection of debt, the bank decided to suspend approximately 17,000 customers’ debt collection cases until they had been recalculated as part of the ongoing efforts to remediate the identified errors in the bank’s debt collection system. These were the cases in which more than 60% of the principal amount had been repaid for which reason there was a higher risk that overcollection would take place before the cases had been reviewed. The collection would resume when each case had been reviewed and potential errors corrected. Furthermore, interest would not accrue while collection was suspended.

It was not until 2020 that the real problems in computer systems were addressed. Then an IT implementation plan was set in motion, which included a number of technical safeguards and improvements to the implicated IT system in order to enhance existing and set up additional checks and controls.

Examiners were asked to find out how many customers have been affected by the errors. As a starting point, a total of 402,000 customers with 600,000 accounts were processed.

Examiners found that the total number of possibly impacted customers across systems, and who were at risk of potentially having made overpayments, was 106,000. On the other hand, examiners found that a total of 105,000 customers had not made any payments to the debt when entering the debt collection system. People who were eligible of repayments because of overpayments had so far received on average one or two thousand Danish kroner, but they were probably entitled to higher amounts.

While the bank was recalculating accounts for potential overpayments, customers received no information about it. At the time of the investigation in 2020, only 17,000 out of 106,000 customer cases had been recalculated.



Download



Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.