For sale: Your bank statements

2013-12-22 14:02

Companies pay for info on rivals, partners

Two Gauteng private investigators have been arrested, along with two former bank employees, for allegedly selling bank statements.

One bank employee allegedly earned more than R50?000 by supplying stolen bank statements to a private investigator.

Another bank official allegedly supplied hundreds of statements to a second private investigator for about R50 each.

A City Press investigation has blown the lid off a lucrative trade in confidential personal information, like bank statements, which is available to third parties at a price.

A private investigator says corporates often buy illegally obtained information about competitors or prospective business partners.

The aim is to get the jump on competitors, or to establish the financial health of prospective business partners.

This flourishing trade in information comes with the dramatic increase in the number of investigators who obtain sensitive information like telephone records, bank statements and other sensitive information at a fee.

Earlier this month, the Hawks arrested two private investigators and two former bank employees in connection with the bank statement theft.

They were part of two separate syndicates.

An intermediary and a businessman from Cape Town were also arrested.

The six will appear in the Cape Town Magistrates’ Court in February.

City Press understands the investigation is continuing after raids on the private investigators’ premises.

The syndicate was exposed after three Cape Town construction businesses lodged criminal charges with the police and hired their own investigator to establish how their bank statements ended up in the hands of a competitor.

The three business owners, who asked to remain anonymous because of pending legal action, were alerted early last year that a rival business had contracted private detectives to obtain their bank statements. An informer also provided them with the stolen statements.

In one case, FNB denied a breach of security on an affected bank account until the victim provided the bank with one of the stolen statements he had received from the informer.

In another, Standard Bank denied any security breach within days of the victim learning that the illicit buyer of the statements had contacted one of his overseas suppliers and tried to undercut him on his price.

When the victims learnt of the thefts and contacted the banks, they took days or weeks to respond to their emails and telephone calls, and told them that such breaches were not possible.

It took the clients more than a year to get their banks to admit that irregular activity had taken place on their accounts. This was only after they had engaged a private investigator to help them track down the perpetrators.

FNB’s chief risk officer for commercial banking, Johan Louw, said that the bank had only scrutinised the client’s account history on specific dates and that those were not the dates on which the statements were illegally accessed.

“All FNB employees are contractually bound by a confidentiality agreement in which they undertake not to divulge client-related information in any unauthorised manner,” he said.

“Detailed records are kept of all systems access by all employees and unauthorised access can retrospectively be traced back to individual employees. FNB will act swiftly where there is evidence of improper actions of staff in regard to customer information,” said Louw.

FNB confirmed that an employee was dismissed after a disciplinary hearing and that the bank was a complainant in a criminal case.

Standard Bank spokesperson Ross Linstrom said the bank had been “in regular communication with the client concerned” and the bank had laid criminal charges after a “rigorous investigation” by its forensic team.

“As such, Standard Bank would not like to prejudice the investigation and declines to comment further on the matter.”

Probes by the Hawks in Cape Town, assisted by private investigator Jack Brice, showed that investigators had paid spotters’ fees to people who sourced bank employees willing to leak statements for a fee.

The private investigator would then obtain the bank statements and sell it on to other investigators, adding his own mark-up.

Stuart Grobler, general manager for banking and financial services at the Banking Association of SA, said banks and banking staff were “bound by strict common law duty of care not to disclose customers’ information”, except under very specific conditions.

He said it was impossible to deny bank staff access to information that they needed to do their work.

“Unfortunately, it is impossible to prevent corruption due to bribery or other pressures.”

He said while the association could not speak for individual banks’ guidelines in the case of staff corruption and disclosure of personal information, “it is likely that most or all banks would view such breaches of confidentiality as a dismissible offence”.

Siziwe Zuma, spokesperson for the Private Security Industry Regulatory Authority, said it prohibited private investigators from asking anyone to break the law or infringe someone’s privacy in the course of their investigations.

Price for your personal info

Legally, personal information can only be obtained through a warrant or expensive civil action known as an Anton Piller order.

Power utility Eskom was forced to apologise last month after being caught hiring a firm of private investigators to spy on activists opposing the Medupi power station.

A private investigator, who spoke on condition of anonymity, outlined the going rates for some of these illegal information purchases:

»?Someone’s itemised cellphone billing can cost up to R9?000;

»?The price of a month’s bank statements vary between R2?500 and R4?000, although City Press saw quotations from another private investigator charging as little as R1?200 for a month’s bank statements;

»?It costs about R12?500 to bug someone’s house; and

»?It’s fairly common for private investigators to launch phishing attacks on subjects’ computers in order to intercept their emails.

But Chad Thomas, a private investigator with IRS Forensic Investigations, says private investigators willing to obtain information illegally are in the minority.

“Many respectable independent investigation companies engage with law enforcement agencies and the courts to legitimately obtain information,” said Thomas.

He said unscrupulous private investigators often obtained confidential information by paying corrupt police officers to fabricate warrants using false case numbers.

“Many independent forensic investigation firms do not condone such actions and have, in the past, reported the illegal actions of these companies.”

Another private investigator, who asked to remain anonymous, said the boom in the illegal trade of confidential information was partly due to the lack of skill and capacity in the police.

Victims of house robberies were often referred to a private investigator who would illegally obtain the records of a stolen cellphone, which would then be handed back to the police and the stolen property tracked down, even though the police knew the information was illegally obtained.

“It could take the police six to eight weeks to obtain the same information following official channels. But by taking the illegal route, the complainant gets satisfaction and the case is solved much faster,” said the private investigator.

He said investigators also did credit-bureau checks on people without their permission.

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