Why Is California the Bank-Crime Capital of the Country? Critics Blame Institutions' Apathy, Freeway Network, Drug Trafficking, Branching System

By Brouillette, Geoff | American Banker, January 31, 1984 | Go to article overview

Why Is California the Bank-Crime Capital of the Country? Critics Blame Institutions' Apathy, Freeway Network, Drug Trafficking, Branching System


Brouillette, Geoff, American Banker


Why Is California the Bank-Crime Capital of the Country?

Critics Blame Institutions' Apathy, Freeway Network, Drug Trafficking, Branching System

Los Angeles is such a popular target for bank robbers that it has not had a single working day without a robbery of a financial institution since Oct. 4, 1979. Last year, while bank robberies declined 11% across the country, they rose 18% in Los Angeles.

The city's problems are a microcosm of the state's. California is, by far and away, the state hardest hit by bank crimes. During the first half of 1983, there were 3,284 external crimes against financial institutions. Of that total, 1,245 occurred in California.

These included robberies, burglaries, larcenies, and violations of the Hobbs Act, which usually involves robbery through coercion, such as a threat against a banker's family.

In the same period, 4,352 cases of bank fraud and embezzlement were reported in the nation; 1,159 occurred in California.

Federal Bureau of Investigation figures for the second half of the year have not yet been released. As for 1984, according to FBI special agent and Los Angeles spokesman John Hoos, there were 156 robberies in the first three weeks of this month, four more than in all of January 1983.

Why is California so popular for bank robberies? Why not New York, which has nearly the same population but ranks a poor second in all areas of bank crime?

The reasons offered here and in Los Angles have one thing in common: most of those who offer them would prefer not to be quoted. One who was quoted--Robert Brossio, chief prosecutor for the U.S. attorney in Los Angeles--told Time magazine recently that he blamed the reluctance of banks to take adequate precautions.

Time editorialized that the costs of the robberies to financial institutions in California amounted to an "untroubling average of around $1,300 per branch . . .. The public, of course, picks up the cost of apprehending, prosecuting, and jailing the robbers.' According to the FBI figures, losses to the U.S. financial institutions in the six-month period totaled $182.5 million.

Another reason offered is the vast network of freeways in Southern California that makes escapes easy and, therefore, bank robberies more attractive. Rob a bank, get on the freeway a few blocks away, and get lost--it's as easy as that.

Law enforcement officers, however, do not consider the efficient freeway system the major cause. They note that San Francisco, which leads New York City in bank robberies--546 last year compared with New York's 443--is more compact and does not boast the freeway network of Southern California.

One explanation is that heavy crackdowns on drug trafficking in the East have moved that traffic to the West Coast. Also, there has been a growth in usage resulting in more robberies by addicts.

Mr. Hoos notes that an estimated 70% of the bank robberies in Los Angeles last year were drug-related, compared with a national average of about 40%. Law enforcement officers and bank security personnel have long pointed out that robbers who hit banks are foolish, because of the high apprehension rate-- about 75% in Los Angeles--but junkies apparently have not yet gotten the message.

Branch banking, of which California was the pioneer in this country, also takes its lumps. Critics claim that the more branches that are available, the more likely it is that a higher robbery rate will result.

They also say that heavy branching helps explain the state's high percentage of fraud and embezzlement. With more branches, argue the critics, the financial institutions need more staff, and with more staff there is likely to be more turnover, which encourages such crimes.

Mr. Hoos agrees that perpetrators of bank fraud and embezzlement are often found to be employees "who stay six to eight months, then leave and take with them whatever's available. …

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