Bank of Hawaii to close Hawaii branch for $1 million over account fraud
Hawaii will close its Bank of Hawaiian branch after a $1.9 million account fraud scandal erupted over the weekend, according to the Hawaii Attorney General’s office.
Neil Abercrombie announced the closure Monday afternoon, a day after a criminal investigation revealed the Bank of Hawai’i opened unauthorized accounts for people with credit card and debit card balances.
“I’m proud of the Bank’s employees, and their diligent efforts in keeping our community safe and secure,” Abercrome said.
“We are making this decision because of the seriousness of the charges, and the fraud they committed.
We have put in place new security measures, including a new customer verification process, and are conducting an audit of all of our accounts to make sure nothing like this ever happens again.”
According to the investigation, customers with credit cards at the Bank had access to $7.8 million in funds deposited into their bank accounts without authorization.
Bank of Honolulu said the fraud occurred when the accounts were closed on Feb. 4, 2014.
The bank said it was investigating how the accounts accessed the funds.
The Bank of Maui closed its Bank Maui branch after investigators found it was allowing unauthorized accounts to be opened for customers.
The investigation found that more than $2.3 million was deposited into accounts in Maui without the knowledge of the bank, and more than 200 accounts were opened without authorization by customers.
The Kauai County Attorney’s office said Monday that it has opened criminal investigations into the bank’s activities and is investigating the bank.