Last week, the OIG recognized International Fraud Awareness Week, a global effort to minimize the impact of fraud by promoting anti-fraud awareness and education. As the independent office that works to detect and deter waste, fraud, and abuse, the Office of Inspector General (OIG) wants to take this opportunity to remind employees about the impact fraud can have and how the OIG works to combat fraud in the banking system.
Read on to learn more. And, remember: If you suspect fraud, waste, abuse, mismanagement, or misconduct in FDIC programs or operations, or at FDIC-insured banks, you should report those allegations to the FDIC OIG Hotline.
What is fraud?
The term fraud encompasses actions that are meant to deceive for financial or personal gain. It’s any intentional or deliberate act to deprive another of property or money by guile, deception, or other unfair means.
Why should I care about fraud?
Fraud causes billions of dollars in damage to companies, governments, and individuals each year. Additionally, fraud can dramatically affect the quality of life of its victims — and the employees of its victims — resulting in job losses, the loss of savings and investments, weakened trust in public institutions and a significant strain on resources.
How does fraud impact the banking system?
Fraud directly impacts FDIC-insured financial institutions when insiders abuse their positions of trust to commit fraud, collude with borrowers and third parties to commit fraud, fail to appropriately monitor and report suspicious activities, or conceal material information from federal and state regulators. Insider fraud adversely affects a financial institution’s financial condition, and, in some cases, can lead to the failure of a financial institution. Bad actors within the financial system pose a risk to FDIC-insured financial institutions and undermine the stability and public confidence in the nation’s financial system.
Cyber-related fraud also impacts FDIC-insured financial institutions and FinTech companies, particularly in cases where employees compromise banking or personally identifiable information (PII) using social media and other digital platforms to then sell the information.
How does the FDIC OIG address fraud?
The FDIC OIG Office of Investigations investigates allegations of crimes involving FDIC-regulated and -insured banks and FDIC activities, and has specialized expertise in financial crimes, fraud investigations, and cybercrimes. Recent investigative outcomes showcase the importance of fraud detection and prevention:
- Former Banker Sentenced for Embezzlement
- Former Bank of O’Fallon Executive Sentenced to Prison for Swindling $2 Million in Check Kiting Fraud Scheme
- Former First Community Bank Vice President Sentenced to Five Years in Prison for Embezzlement Scheme
- TD Bank Insider Pleads Guilty to Accepting Bribes to Fraudulently Open More Than 100 Bank Accounts
- Southern District of New York | Startup CEO Charlie Javice Sentenced To 85 Months in Prison For $175 Million Fraud | United States Department of Justice
- Center City Real Estate Agent Pleads Guilty to Charges Arising from Fraudulent Loan Scheme
- Man Sentenced for Over $11M COVID-19 Relief Fraud and Money Laundering Scheme
How does the FDIC OIG provide education about fraud?
The FDIC OIG helps educate the FDIC workforce and regulatory stakeholders on fraud by teaching classes through the Federal Financial Institutions Examination Council (FFIEC) that help examiners identify red flags for fraud during examinations, teach them the document types they may want to examine if they identify potential fraud, and understand techniques for examining those documents (including tracing funds).
The FDIC OIG also regularly participates in FFIEC- and FDIC-sponsored conferences, including, most recently, the 2025 FDIC Data Summit, FFIEC 2025 Financial Crimes Seminar, 2024 FDIC Accounting and Auditing Conference, 2024 FDIC/DOJ Financial Crimes Conference and 2024 Financial Crimes Seminar.
Additionally, the FDIC OIG engages in outreach efforts across the country to educate the public and other stakeholders on fraud. We participate in task forces, partnerships, and initiatives aimed at identifying and stopping the flow of illicit funds, including:
- AARP’s Fraud Watch Network
- American Bankers Association
- American Association of Retired Persons
- Aspen Institute Anti-Fraud Initiative
- Anti-Money Laundering Education Groups
- Regional Banking Associations
- Association of Certified Anti-Money Laundering Specialists
- Association of Certified Fraud Examiners Bank Secrecy Act/Anti-Money Laundering/Financial Crimes Task Forces
- FBI Complex Financial Crimes Task Forces
- HSI Financial Crimes Task Forces
The FDIC OIG also participates in the FBI’s “Operation Level Up,” which is a proactive approach to identify and notify victims of cryptocurrency investment fraud and halt fraud. Operation Level Up has prevented well over $400 million in fraud losses to date.
Visit the FDIC OIG’s website, X account, and LinkedIn page for more information about common fraud scams and how to avoid becoming a victim.