Although Mexican banks have stabilized the threat from armed robberies, the threat from increasingly sophisticated and polished criminals is on the rise. Criminals are learning that well-executed fraud and credit card scams are less risky and yield a higher return than old-style bank robberies. However, these operations require sophistication, planning, and inside knowledge not available to run-of-the-mill Mexican bank robbers.
As a result, says Jaime, “The great danger is coming far more from white collar employees and through electronic transactions.”
One tactic used by organized crime is “to infiltrate their people into our banks whenever we hire staff,” explains Jaime. Another approach criminals take, he explains, is that “they try to turn an employee who may have some financial or personal problems into an ally. They use blackmail and intimidation.”
Vetting of prospective employees and periodic screening of current staff is a key element in maintaining security. Background checks have become common practice in Mexico, but they are harder to do than in the United States.
Public and private databases are incomplete. Some information, such as criminal records, is not released officially, although investigators can access such records on an informal basis by using their law-enforcement connections. Banks avoid resorting to informal verifications, because they are undocumented, unreliable, and require small bribes to government officials.
Instead, verifications are subjective and often include a visit to an applicant’s home and neighborhood. In these cases, investigators interview residents to verify the applicant’s background.
Existing employees also need to be screened, says Septien. “The risk exists that even an employee who checked out okay may have had some misfortune. Maybe he needs some money and drug traffickers or criminals will offer him money to facilitate their actions,” Septien explains.
And if money does not work as an incentive, intimidation usually does. “Local people know where everyone in the neighborhood works. It is hard to resist threats,” he says.
Another concern among Mexico’s financial services sector is the emergence of newer banks with limited experience in security that are unwilling to invest in more than the absolute minimum needed to comply with regulations. Established banks complain that these new entrants are undermining some of the progress the industry has made against crime.
These startups “do not want to invest the amounts needed to ensure security in their systems. That opens vulnerabilities in the banking system’s interconnected networks and makes us all vulnerable to hackers and to fraud,” says the head of security at one foreign bank with facilities in Mexico.
“The big banks have state-of-the-art technologies, and they can adapt quickly to changes in the threats they face. We follow global best-practice standards that are stricter than local legal requirements,” he says. “The small banks are not moving as fast as we would desire. They are an open door to criminals.”
Mexico’s banks face a constant danger from drug-money launderers. Usually, they prefer to recycle their profits through shell companies, offshore banks, and fake accounts at local banks. However, a U.S. Congressional Research Service report highlights how the gangs have evolved into tightly managed enterprises that penetrate banks by intimidating or bribing government officials and bank employees or by infiltrating gang members into financial institutions. Although money laundering is not theft, the techniques facilitate crimes by helping the perpetrators obscure the origins of their money.