Announcement

Banking Industry's Standards Against Forgery Preserved by Industrial Court

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26 July 2024

P. Thavaselvi, together with Sophia Ismail from Zul Rafique & Partners’ Employment and Industrial Relations Practice Group had successfully acted for RHB Bank Berhad (“the Bank”) at the Industrial Court in respect of an unfair dismissal claim by an ex-employee of the Bank (“the Claimant”), wherein Learned Chairman YA Puan Eswary Maree decided in favour of the Bank vide Industrial Court Award No. 1054 of 2024.

Brief Facts
The Claimant commenced employment with the Bank on permanent basis on 1.4.2014 as an Executive. With effect from 1.1.2016, the Claimant was promoted to the position of Sales Manager - Bancassurance. The Claimant was suspended from service with effect from 30.8.2018 on grounds of major misconduct involving forgery of a customer’s signatures on the proposal form for four (4) life insurance policies without the customer’s knowledge and authorization. Thereafter, a Notice of Intended Disciplinary Action (“NOIDA”) dated 22.10.2018 was issued to the Claimant. By a letter dated 25.10.2018, the Claimant provided her explanation to the NOIDA, which the Bank found unsatisfactory. The Claimant was dismissed from service with effect from 3.12.2018.

The Industrial Court’s Findings
Inter alia:-

(i) Based on the totality of the proved or admitted facts and/or evidence, the Bank had proven on a balance of probabilities that at the time of the dismissal, there were reasonable grounds for believing that the Claimant forged COW-10’s signatures on the Proposal Forms for the four (4) disputed policies.

(ii) Based on the totality of the evidence, including unchallenged testimonies of and the Claimant’s admission, the Bank has proven on a balance of probabilities that the Claimant was involved in forging the signatures of COW-10 in the Proposal Forms and PSIP for all the four (4) disputes policies. All the evidence also established the fact that the Claimant's knowledge and participation in the preparation, submission and benefit from the policy, leading to reasonable grounds for the Bank's belief in her misconduct at the material time.

(iii) Based on the evidence and testimonies, it was proven on a balance of probabilities that COW-10 was advised by the Claimant to sign documents and declare policies as lost, despite surrendering them. The Claimant’s pattern of behaviour shows a consistent modus operandi of securing signatures and completing forms without proper consent, indicating potential forgery and dishonesty. This behaviour reflects negatively on the Claimant’s integrity and supports the Bank's decision to believe there were reasonable grounds for dismissing the Claimant.

(iv) The circumstantial evidence against the Claimant was compelling and points irresistibly to her guilt, extending beyond mere suspicion. The Industrial Court referred to the case of Mui Bank Bhd. Johor V. Tee Puat Kuay @ Tee Puat Kway [1993] 4 CLJ 69 where it was held that strong circumstantial evidence can establish guilt.

Decision
Based on the balance of probabilities, the Industrial Court found that the Claimant was guilty of the misconduct, which involves elements of dishonesty that significantly affects her integrity as an employee. As such, the Industrial Court found that the Claimant’s dismissal was with just cause and excuse. Accordingly, the Claimant's claim was dismissed.

Key Takeaways

1. Performance and years of service does not immunize an employee from dismissal due to misconduct or shield him/her from the consequences of his/her action (Jaya Balan @ Sundra Raj Suppiah v. Texas Instrument (M) Sdn Bhd [2013] 3 ILR 502).

2. Failure to hold a Domestic Inquiry is not a fatality but only an irregularity curable by de novo proceedings before the Industrial Court if the employee is given ample opportunity to be heard and given chances to explain and rebut the misconduct(s). However, strong circumstantial evidence can establish guilt.

3. The evidence of a Forensic Document Examiner as an Expert Witness is acceptable by the Industrial Court. If the Expert Witness’ credibility and/or findings are challenged, this ought to be supported with evidence. However, the best person to know and confirm whether his/her signature is authentic or forged irrespective of any forensic evidence, is the person whose signature it is alleged to be.

4. The banking industry requires the highest standards of integrity and honesty from its employees, given its role as a custodian of public funds. Forgery is a severe offense involving fraudulent intentions and if left unpunished, could undermine public confidence in the Bank(s) and by extension, the financial system.

For more insight into this area of law, please contact our Partner in our Employment & Industrial Relations Practice Group:
P Jayasingam
Wong Keat Ching
Thavaselvi Pararajasingam
Teoh Alvare

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