Financial institutions are entrusted with the savings and investments of their clients, but not everyone is there for the protection of the client’s funds. Statistics show that bank employees make off with more money each year than robberies, though internal theft is on the rise in every industry. Financial institutions hold large amounts of financial transaction information and personal identification data that make it easy for fraudsters to find an opportunity for theft.
Protecting the Finances at a Bank
A fidelity bond is a common form of insurance the protects policyholders in the event of losses that occur because of fraudulent acts. Most often, it is the dishonest acts of employees that result in theft. Within a bank or other investment office, financial institution bonds offer the same protections. Illegal acts committed by employees on the job are the specific designation of this coverage. Illegal acts could include forgery, outright theft, or dishonest practices that result in a loss for your company and its consumers.
Preparing for the Cost
Trying to defend your company in a lawsuit filed by the client-turned-victim is difficult and costly. Whether you operate a credit union, bank, mortgage institution, or other financial institution, the cost of purchasing a bond is much more affordable than paying out-of-pocket for a client settlement and legal fees. Your cost depends on how many employees you have and the type of transactions that occur.