A
bond or
insurance policy covering a
bank in the event it
loses money as the result of employee theft or
fraud. Blanket fidelity bonds generally only cover situations in which an employee commits fraud for personal
gain; they do not cover situations in which the employee, without support or knowledge of management, falsifies
transactions to make the bank appear healthier than it is. Some U.S. states require banks to have blanket bonds. It is a type of
blanket fidelity bond.