Complex embezzlement scheme could have cost banks millions

An investigation has been launched by the police into a possible case of embezzlement in Slovakia’s two largest banks Slovenska sporitelna, a.s. and VUB, a.s.. The banks may have lost millions of euros from the action of their own employees.

Dealers of the banks seemingly embezzled money out of the banks by using numerous intermediaries in bond transactions, each of which retained a percentage commission of the purchase prices on the deals.  There is a suspicion that a Czech branch of a global bank may also have been involved.

The bankers were mutually trading with state bonds on the Bratislava stock exchange BCPB, and the well-thought out scheme made use of high-spread securities, which means there was a big difference between the buying and selling prices. The banks did not notice anything because everything was legitimate through the bank system, and because the dealers were well acquainted with the banks’ strategies, they were making deals in accordance with their bank’s limits.

The case has been followed closely by financial weekly TREND, which disclosed the information today, 18 August. Suspicions were raised earlier this year as many of the dealers started to enjoy a more luxurious lifestyle before eventually leaving the bank.

Through their embarrassment, though, the banks have been keeping their lips sealed about the affair for several months, and downsizing it to a ‘few deals’ and a ‘few hundred thousand euros’, but the true extent of the embezzlement is still not yet known. TREND believes that the final bill could be as high as EUR 13 million.

Slovenska sporitelna, VUB, and the National Bank of Slovakia have already filed a criminal complaint concerning the matter.

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