Sunday, September 29, 2013

Caribbean Airlines manager suspended: Million-dollar fraud investigation continues

State carrier Caribbean Airlines has suspended one of its managers as an investigation continues into what has been described as a million-dollar fraud involving the use of bogus credit cards which has already cost CAL more than $12 million in losses.

Sources familiar with the airline’s operations say due to CAL not adequately addressing validation measures for local and European credit cards, scammers have managed to evade detection by CAL officials and have managed to get refunds from sales activities with the airline.

Sources say from January 2012 to June 2013, CAL has lost more than US$1,721,792 in charge-back claims.

Charge-backs are the return of funds to customers.

It is the reversal of a prior outbound transfer of funds.

Following a forensic investigation by CAL’s internal auditing department and Ernst and Young, a senior accounting manager at the airline was suspended last week for two weeks.

The suspension took effect from last Monday and the manager has been mandated to provide the interim CAL board led by chairman Phillip Marshall with a comprehensive report about the transactions which led to CAL’s losses.

Contacted for a comment, CAL head, corporate communications, Clint Williams confirmed last week that a member of the finance department “has been recently suspended”.

But he insisted that it was not in connection with the ongoing investigations into credit card irregularities.

Williams told Sunday Express that it would be highly improper to comment on the status of any specific employee.

Questioned as to how much CAL has lost prior to January 2012 to the present because of the credit card issues, Williams said the credit card irregularities referred to past abuses by external parties that were currently under audit and investigation.

“As such it would be improper to comment further while the investigation is ongoing,” Williams said.

He added that following detection of the illegal acts, CAL “has since introduced fraud prevention tools that have already significantly reduced the incidence of such activities”.

The airline is also working alongside several agencies in a bid to suffocate the scammers.

The fraudulent activities sources say involve European, Jamaican and Nigerian nationals.

Sources say the scam involved the booking of airline tickets via credit card.

“Calls to (CAL call) centers come in after 6 p.m., when banks are closed and there is no way of verifying the information on the cards,” the source said.

Adding that the fraudsters normally booked business class tickets to the United States, England and several Caribbean countries, the source said, after the booking is made, the transaction is cancelled, following which the fraudsters call back the centers saying they wish to cancel the transactions and get a refund.

Contacted for a comment senior reservations and commercial sales manager Valerie Murphy-Rahman, who was on vacation last week, said  she was not responsible for overseeing the finance department.

She said she was not aware of the investigation related to the credit card irregularities. 

Original article:

No comments:

Post a Comment