12 March 2010

Operational Risk often neglected

Most investors are focused exclusively on the quest for securing the best financial return on their investments. But recent developments have highlighted the need to ensure the safe return of the investment. Several prominent banks have been found wanting in protecting the confidentiality of client accounts held by their Swiss Branches. While no money was reported to have been lost as a consequence the fact that client records could have been transferred to a CD and the information offered to governments in surrounding states should set alarm bells ringing among investors. If it seems to be easy enough to steal customer data it may not be beyond some criminal mind to transfer money from client accounts. Clients are advised to conduct thorough due diligence on the operations of any bank or money manager they entrust their investments to. Slick advertising, tips from advisers or friends should not be the sole basis of picking a firm.