FDIC: Loan Sales Jeopardized by Systems and Other Internal Control Problems
IMTEC-91-61
Published: Aug 21, 1991. Publicly Released: Aug 21, 1991.
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Highlights
GAO provided information on loans purchased from the Federal Deposit Insurance Corporation (FDIC), focusing on whether: (1) the automated system used to account for the loans and provide information to investors accurately reflected information stored in the manual loan files; and (2) such manual loan files were accurate.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Federal Deposit Insurance Corporation | Given the importance of accurate asset information, the Chairman, FDIC, should take immediate action at the Denver Consolidated Office to ensure that cash receipts are properly accounted for in the manual and automated loan records. |
Closed – Implemented
Internal controls for cash receipts accounting have been strengthened. A logging procedure is in place to ensure that cash receipts and loan balances are accurately reflected on both the manual and automated systems.
|
| Federal Deposit Insurance Corporation | Given the importance of accurate asset information, the Chairman, FDIC, should take immediate action at the Denver Consolidated Office to ensure that the manual and automated loan records are corrected to provide accurate and current information. |
Closed – Implemented
The Denver Consolidated Office reviewed manual and automated records to ensure the information is accurate and complete. Additionally, FDIC issued a directive in the second quarter of 1992 requiring consolidated offices to certify the accuracy of critical data elements in their manual and automated systems.
|
| Federal Deposit Insurance Corporation | Given the importance of accurate asset information, the Chairman, FDIC, should take immediate action at the Denver Consolidated Office to ensure that procedures are strengthened to continually maintain accurate and current loan records. |
Closed – Implemented
A new Managing Liquidator was appointed for the Denver Consolidated Office. The Managing Liquidator directed department heads to ensure data accuracy. Site-specific procedures have been developed to monitor the accuracy and currency of loan records at the Denver office.
|
| Federal Deposit Insurance Corporation | Given the importance of accurate asset information, the Chairman, FDIC, should take immediate action at the Denver Consolidated Office to ensure that loan records are periodically reviewed to verify the status of the loans. |
Closed – Implemented
A new Managing Liquidator was appointed for the Denver Consolidated Office. The Managing Liquidator directed department heads to periodically review loan records to ensure that loan status information is accurate and complete.
|
| Federal Deposit Insurance Corporation | The Chairman, FDIC, should take steps to ensure that the internal control weaknesses discussed in this report do not exist at other FDIC offices. |
Closed – Implemented
Effective July 1, 1992, the Director of the Division of Liquidation issued a directive requiring each account officer to review the assets in their portfolio, make appropriate corrections to data elements in LAMIS, and certify that the record is accurate. This action is to compensate for any internal control weaknesses.
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Topics
Electronic data processingFederal corporationsInformation disclosureInformation systemsLoan accounting systemsLoan repaymentsLoansManagement information systemsRecords managementRisk management