BSP WARNED ABOUT LINKS TO ROBBERS
ILYA GRIDNEFF, AAP
The South Pacific's largest commercial bank had numerous warnings that senior staff in Papua New Guinea had close criminal connections, months before three branches were hit by robberies, documents show.
Internal security briefings obtained by AAP show Bank South Pacific (BSP) was told in early 2008 of links between PNG's notorious gangs known as "raskols" and staff, with some criminals even visiting senior staff at BSP's Port Moresby head office.
Documents show BSP's former head of security services, Duncan Smith, raised various security concerns with BSP executives after investigating the matter in February 2008.
The following month, Smith was sacked - one year into his three-year contract with BSP - due to company "restructuring". Then on May 19, BSP's Kerema branch, in Gulf Province on PNG's southeast coast, was robbed of one million kina ($A400,000).
PNG police subsequently arrested four local bank staff and a villager over the heist.
Shortly after the robbery, former BSP chief executive Garth McIlwain rehired Smith on a two-week contract, requesting he "undertake an intensive investigation" into staff with criminal links. Smith's report given to BSP executives in early June 2008 stated: "The recruitment of security staff is, again, unsatisfactory and requires immediate review."
AAP understands the report was shelved and various staff mentioned remain working at BSP.
A month later BSP's Madang branch, on PNG's northeast coast, was robbed in similar circumstances to the Kerema robbery, with staff kidnapped and held hostage. In December 2008 police shot dead two of five bank robbers and recovered 500,000 kina ($A200,000) in cash after a shootout with the same gang at BSP's Kimbe branch, West New Britain province, a central island region.
BSP chief executive Ian Clyne did not respond to AAP's questions via repeated emails and phone calls.
Smith, now living in Dubai, declined to comment on the robberies. However, he commended BSP for last year upgrading its financial crime and compliance system to stop money laundering and tackle fraud.
Despite the technology upgrade, an internal 2009 audit found 16 million kina ($A6.4 million) had been lost to internal theft and fraud that year. In a videotaped police confession recently seen by AAP, PNG's most wanted criminal William Kapris, facing trial for his alleged involvement in the BSP robberies, alleges senior government officials funded and supported him while also receiving help from BSP workers.
BSP is PNG's largest bank with branches also in Fiji, Solomon Islands and Niue encompassing about 650,000 banking customers. The bank's net profit increased to 257.1 million kina ($A102.7 million) last year compared to 228.3 million kina ($A91.2 million) in 2008.
The South Pacific's largest commercial bank had numerous warnings that senior staff in Papua New Guinea had close criminal connections, months before three branches were hit by robberies, documents show.
Internal security briefings obtained by AAP show Bank South Pacific (BSP) was told in early 2008 of links between PNG's notorious gangs known as "raskols" and staff, with some criminals even visiting senior staff at BSP's Port Moresby head office.
Documents show BSP's former head of security services, Duncan Smith, raised various security concerns with BSP executives after investigating the matter in February 2008.
The following month, Smith was sacked - one year into his three-year contract with BSP - due to company "restructuring". Then on May 19, BSP's Kerema branch, in Gulf Province on PNG's southeast coast, was robbed of one million kina ($A400,000).
PNG police subsequently arrested four local bank staff and a villager over the heist.
Shortly after the robbery, former BSP chief executive Garth McIlwain rehired Smith on a two-week contract, requesting he "undertake an intensive investigation" into staff with criminal links. Smith's report given to BSP executives in early June 2008 stated: "The recruitment of security staff is, again, unsatisfactory and requires immediate review."
AAP understands the report was shelved and various staff mentioned remain working at BSP.
A month later BSP's Madang branch, on PNG's northeast coast, was robbed in similar circumstances to the Kerema robbery, with staff kidnapped and held hostage. In December 2008 police shot dead two of five bank robbers and recovered 500,000 kina ($A200,000) in cash after a shootout with the same gang at BSP's Kimbe branch, West New Britain province, a central island region.
BSP chief executive Ian Clyne did not respond to AAP's questions via repeated emails and phone calls.
Smith, now living in Dubai, declined to comment on the robberies. However, he commended BSP for last year upgrading its financial crime and compliance system to stop money laundering and tackle fraud.
Despite the technology upgrade, an internal 2009 audit found 16 million kina ($A6.4 million) had been lost to internal theft and fraud that year. In a videotaped police confession recently seen by AAP, PNG's most wanted criminal William Kapris, facing trial for his alleged involvement in the BSP robberies, alleges senior government officials funded and supported him while also receiving help from BSP workers.
BSP is PNG's largest bank with branches also in Fiji, Solomon Islands and Niue encompassing about 650,000 banking customers. The bank's net profit increased to 257.1 million kina ($A102.7 million) last year compared to 228.3 million kina ($A91.2 million) in 2008.
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