The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Royal Bahamas Police Force’s top financial crime investigator yesterday urged “vigilance” after it emerged another government agency had allegedly fallen victim to a forged cheque.

Superintendent Matthew Edgecombe, head of the Force’s anti-corruption and financial crimes unit, spoke out after a 41 year-old man was charged with using a forged cheque to defraud the Securities Commission of some $850,000.

This is the second charge involving a government agency, and the use of an allegedly forged cheque, to be brought before the Magistrate’s Court within a week, with the combined sum involved exceeding $2m.

Elma Campbell, the former FNM Cabinet minister and ambassador to China, and her son, Che Chase, were last week charged with defrauding the Ministry of Tourism of some $1.2m. Both pleaded not guilty to all the charges against them.

The Securities Commission, in a statement that was timed to coincide with yesterday’s court hearing, called for “all businesses to be vigilant” when it came to enforcing internal controls designed to prevent fraud, theft and corruption. It added that a simple reconciliation of activity in its operational bank account enabled it to trigger a police investigation.

“In early February 2020, following our normal internal processes, the commission discovered an irregularity in its operational bank account,” the Bahamian capital markets and investments fund regulator said.

“The appropriate persons at our bank were immediately contacted for an explanation and correction of the irregularity. On the next business day, it was determined that a fraudulent cheque in the amount of $850,000.00 was cleared through the commission’s account in January 2020.

“That evening, the commission contacted senior persons at our bank and the financial institution where the fraudulent cheque was deposited. We also reported the matter through the appropriate channels and contacted the police. In turn, the police immediately launched a criminal investigation into the matter,” the Securities Commission said.

“In light of recent events, the Commission encourages all businesses to be vigilant in enforcing basic internal control procedures to prevent and detect fraud, including the timely completion and review of bank reconciliations.”

The Securities Commission’s release echoes similar comments made by Dionisio D’Aguilar, minister of tourism and aviation, who previously said: “I would like to caution everyone who operates a business of chequing account of the technology available now. People can make wonderful copies of your cheques and, once they have your signature transposed, that is a forged cheque and that’s a real concern.

“You may want to switch to wire transfers for payment and moving monies between accounts, but you then have to be vigilant for e-mails asking about your bank account details. There is a constant attack on bank accounts to illegally gain funds, and wherever they feel there are accounts that have a lot of activity, those are high risk.”

Meanwhile, Superintendent Edgecombe revealed yesterday that the police “still have further investigation to do” over the Securities Commission cheque even though Jeremy Pinder, 41, was charged with fraudulently obtaining $850,000 from Royal Bank of Canada (RBC) drawn on the regulator’s account. He denied all charges against him.

“For the last couple of years we’ve seen a number of forged cheques,” Superintendent Edgecombe told Tribune Business. “It’s not new. It happens every year. I wouldn’t say we’ve seen an increase, but a lot of matters have been reported.”

He added that it was critical for the Bahamian private sector to implement the necessary controls, and appropriate checks and balances, around the handling of money and account activity - even to the extent of ensuring those responsible for this activity are properly monitored.

“I tell people at the bank to stick with policies they have put in place around KYC, but sometimes some things fall through the cracks,” Superintendent Edgecombe added. “We say to businesses be vigilant, always review your accounts and know who you are accepting cheques from.”

He agreed that ever-evolving technology, particularly modern scanners and printers, was assisting cheque forgery - especially once the perpetrators got hold of a genuine one, complete with company logo and the correct signatures. They then replace the name of the recipient, and the sum, with the false details.

“They have some ways to make these fraudulent cheques seem genuine,” Superintendent Edgecombe said. “They will have a genuine cheque made out to a client, and what they will do is change the information on the cheque. That’s all they really want.

“It’s been happening for years. Just like fraudulent money. It’s the same thing. It looks like it’s genuine. We go to business places and give them the information on what to look for.”