Article 24Level 1 classification#
Institutions shall classify each loss event in one of the following Level 1 event types:Level 1 event type classification | Description | Reference numberInternal fraud | Losses due to acts of a type intended to defraud and misappropriate property, excluding diversity/discrimination events, which involves at least one internal party (i.e. a party with a direct relationship to the institution or for which the institution is jointly liable), including instances where the internal party is acting in collusion with external parties. | 1External fraud | Losses due to acts of a type intended to defraud and misappropriate property, committed by an external party without the involvement of an internal party. | 2Employment practices and workplace safety | Losses arising from acts inconsistent with employment, health or safety laws or agreements, from payment of personal injury claims, or from diversity/discrimination events towards employees. | 3Clients, products and business practices | Losses other than fraud arising from failure to meet a professional obligation to specific clients (including fiduciary and suitability requirements), from business practices or from the nature or design of a product. | 4Damage to physicalassets | Losses arising from loss or damage to physical assets, employees or affiliates of the institution, public assets or non-affiliated people for which the institution is liable, due to natural disasters or other events, including accidents, wilful damage, war, civil disturbance, riots and terrorism. | 5Business disruption and system failures | Losses arising from disruption of business or system failures. | 6Execution, delivery and process management | Losses from failed transaction processing or process management and data management, from relations with trade counterparties, vendors and regulatory and tax authorities. | 7
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