Download - African Bank

Social matters
Code of ethics
African Bank’s code of ethics commits it to the highest
standards of integrity, behaviour and principles. Staff
at all levels participated in drawing up the code and
are required to maintain the highest ethical standards
in ensuring that our business practices are conducted
in a manner that, in all reasonable circumstances, is
above reproach.
Fraud and fraud
prevention
Channel for whistle blowing – African
Bank Retail brought its ethics line inhouse
in November 2001. Since then,
there has been a significant increase in
the use of this facility. This was
attributable to the reassurance among
staff of the full protection granted to
them when supplying information and
increased awareness of the channels of
communication available in reporting
unethical behaviour through the
prominent display of posters in all offices
of the bank, articles in the internal
magazine, and frequent announcements
of rewards being paid for tip-offs on the
unit’s internal TV channel.
Apart from the normal channels of
reporting unethical behaviour through
management, the following fraudreporting
channels exist:
A toll-free number, 0800 20 20 18,
where callers can remain
anonymous
A fraud ethics e-mail address,
abfraudethics@africanbank.co.za
A dedicated fraud fax line
(011) 315 3424
Credit Indemnity has an intranet contact
link to the forensic department and its
toll-free number is 0860 333 004.
A fraud rewards programme pays
quarterly prizes to the three most
African Bank Investments Limited 78
deserving cases as adjudicated by a
management panel. An annual reward is
paid on a lucky-draw basis to encourage
staff to report all suspected fraud,
irrespective of the outcome or
magnitude of the issue being reported.
Fraud practices
Group policy is to identify and promptly
investigate any possibility of fraudulent
or related dishonest activities against
the group and, when appropriate,
pursue legal remedies. In an effort to
rid the group of such transgressions,
the board supports the zero tolerance
policy on fraud, including dishonesty,
non-adherence to procedures,
negligence, breach of fiduciary duties,
fraud, theft and other irregularities.
This is demonstrated in the internal
magazine where the names of all
offenders who have been dismissed
as a result of unethical behaviour are
publicised. The forensic investigation
services department continues to
entrench this culture.
All staff are responsible and accountable
for exercising due diligence and control
to prevent, detect and report acts or
suspicion of acts of a reportable nature,
as defined in the fraud policy. Fraud
awareness and training initiatives are
continuously provided to staff on various
issues. This has yielded positive results.
Exception reports and a range of quality
tools and techniques are used as an early
detection method in identifying
fraudulent applications prior to
disbursing loans. Confirmed fraudulent
applications, known bogus companies
and fraud alerts received from the South
African Fraud Prevention Services are
added to a daily internal checklist to
prevent further fraud.
The social impact of
unsecured lending
The major slice of the economically-
active population is considered high-risk
clients due to three reasons: inability to
service personal debt, lack of financial
education and poor historical payment
patterns. Traditional banks do not
consider these high-risk clients their
primary target market, and as
a consequence these clients traditionally
had limited access to credit. According
to the LSM classification framework
these high-risk clients fall into the lower
end of the scale.
The contribution of these clients to the
South African economy is real – from a
sheer numbers perspective as well as
their indirect contribution to helping
others (mostly family members) become
involved in the economic cycle of South
Africa. The lack of access to credit for a
huge part of the economically-active
population is detrimental to the
economy. Perceptions of customer
exploitation remain.
ABIL’s innovative business model
helps it to apply economic principles
to the benefit of its clients and its
investors.