Dane Nicholson, chairman of the Jamaica Bankers Association’s fraud prevention committee;
Following public outrage over the light sentence handed down to Kadane Thomas, who pleaded guilty to defrauding customers out of a total of $74.5 million, Dane Nicholson, chairman of the Jamaica Bankers Association’s fraud committee, is calling for amendments to the theft law to impose tougher penalties on those convicted of financial fraud.
Nicholson, who is also the NCB’s head of fraud prevention, has called on authorities to consider establishing a financial court, given the rise in financial crime in Jamaica in recent years.
“Given the prevalence of this problem and the increase in financial fraud over the past few years, it may be prudent to establish a financial court to deal with these types of issues. Just as in Jamaica when there was a gun problem the gun court was established, when there was a traffic problem the traffic court was established and for family matters the family court was established,” he said.
“Now that we have a financial crime problem, it may be wise to consider establishing a financial court,” Nicholson continued.
The call came just a day after it was reported that Thomas, a former employee of NCB Capital Markets, had pleaded guilty to defrauding three of the bank’s clients out of a combined $74.5 million and was sentenced to 24 months in prison.
In February, Thomas pleaded guilty to three counts of theft as a servant and 31 counts of distributing a forged document.
She was charged with theft and violating the Cybercrimes Act in January 2023. According to reports, during her two-year employment as a wealth advisor at NCB Capital Markets, Thomas forged clients’ signatures on debit notes, debited client accounts and transferred funds to multiple accounts, including her own.
Earlier this month, she was ordered to pay back the full amount stolen.
News of her sentence sparked heated debate on social media platforms.
Many people are describing the ruling by Instagram and X (formerly Twitter) as a “light punishment.”
“This sentence will only encourage theft. 2 years is nothing,” one reader commented on a news article posted by the Jamaica Observer on its Instagram platform.
Speaking to Sunday Finance, Nicholson said the debate over the ruling in Thomas’ case had paved the way for greater cooperation between members of the Jamaica Bankers Association, the judiciary and regulators.
He said the verdict demonstrates the clear need for legal reform, tougher penalties and the establishment of specialist financial courts to restore public confidence and deter future financial fraud.
“In my view, and looking at public sentiment on this matter, the ruling sent the wrong message to bystanders and served to colour public perception of the financial sector,” Nicholson said.
“Despite promises of compensation – which the bank is yet to receive – the bank has reimbursed all affected customers. The reputation and image of the affected banks has been tarnished and the sentence is not a strong deterrent to this type of crime,” he added.
As well as recommending the establishment of a financial court, Nicholson is also pushing for the creation of special legal provisions for cases where individuals working in the financial industry breach their fiduciary duties.
He argued that financial fraud by such individuals would not only affect financial institutions, but also harm customers and potentially deter future investment in Jamaica. Furthermore, Mr Nicholson called for mandatory minimum penalties for financial fraud.
“If they are convicted of financial fraud, whether it’s theft as a servant or forging documents, the minimum sentence they will get is 10 years, even if you plead guilty and restitution is paid to the financial institution, because you are in a position of trust, and banking is built on honesty and trust.”
“Despite the strong controls in place at financial institutions, banks are forced to give a certain amount of trust and authority to their staff, so we need strong laws to act as a deterrent,” he said.
Thomas’ sentence has been described as “lighter” than that of Andrea Gordon, a former senior executive at National Commercial Bank, who was convicted of defrauding the financial institution of $34 million and sentenced to seven and a half years in prison in 2021.
Gordon was ordered to pay back about $120 million.
Nicholson speculates that if Thomas were to take a plea deal in parish court, he could receive a lighter sentence. He suggests that such cases should be heard by the Supreme Court, as Gordon’s was. He also suggests that the way plea deals are negotiated, especially for employees in the financial industry, should be reconsidered to ensure that the seriousness of the crimes committed is not downplayed.
“Police had hoped to bring charges under the Cybercrimes Act but the prosecution did not present any evidence to support those charges. Those charges carry heavier penalties so given the reputational damage that fraud cases cause, particularly with regard to those in the financial sector, that may also need to be looked at to see how plea bargains are worked out and justice is served,” Nicholson said.
The call for tougher penalties at the judicial system level comes amid efforts by local banks to minimise fraudulent activities. Internally, banks conduct various checks such as background checks and police reports to ensure that no one has any past criminal convictions. All financial institutions also have in place a “know your employee” framework and methodology to detect such issues along with internal controls such as segregation of duties and limit management to ensure that no one can carry out transactions alone.
But Nicholson said loopholes often emerge through the relationships employees build with customers.
“The problem is often employees manipulating and taking advantage of customers,” he said.
To minimise this, local banks have embarked on awareness campaigns to teach consumers how to recognise and avoid scams, especially online scams. For example, the NCB has issued an anti-fraud education notice on Friday.
Nicholson said most local financial institutions have seen a decrease in online fraud compared to last year.
