SpareBank 1 SMN reported on 19 January 2023 a hired replacement employee to the police for gross embezzlement. The offence was brought to light by the bank’s own control systems. The police investigation confirms that a total close to NOK 75 million has been embezzled. About NOK 50 million of this sum is considered to have been lost. The bank has insurance cover against economic crime, and no customers are affected.
The accused has been employed as a hired replacement at SpareBank 1 SMN’s head office since 2020. Routine checks were performed in connection with his appointment.
“The bank has fallen victim to serious economic crime. Moreover, a gross breach of trust has been committed inasmuch as the accused has misused his access to systems for his own gain and in addition manipulated our control functions,” says executive director Rolf Jarle Brøske at SpareBank 1 SMN.
The bulk of the embezzlement occurred over a brief period before being detected and reported to the Police. The funds involved were transferred to accounts with other banks in Norway, and onwards out of the country. They were then invested very largely in securities and financial instruments carrying particularly high risk.
“In the past two weeks the bank has worked closely with the Police to assist in the investigations, and to secure as much of the funds as possible. We must unfortunately note that a large portion of the embezzled funds has been lost after what appears to be wild speculation abroad”, says Mr Brøske.
The Police investigation, which matches the bank’s own enquiries, shows that the embezzlement totals just under NOK 75 million. Because the accused returned part of that amount to SpareBank 1 SMN before his arrest, the net amount taken out of the bank comes to just over NOK 66 million. The Police have secured a little over NOK 15 million in Sweden. Based on the information now known, just over NOK 50 million of the embezzled amount has been lost.
SpareBank 1 SMN has insurance cover against economic crime, including embezzlement. The insurance policy carries a deductible of NOK 5 million.
“We have now established a good overview of the course of events, and have taken a number of immediate measures. Moreover, the bank has a comprehensive effort under way to pinpoint further measures. We also have a good dialogue with Norway’s Financial Supervisory Authority,” says Mr Brøske.
Contact information:
For the media:
Executive director Rolf Jarle Brøske on +47 911 12 475
For investors:
CFO Trond Søraas on +47 922 36 803