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TMI BlogBank Reforms to Check FraudsX X X X Extracts X X X X X X X X Extracts X X X X ..... Bank Reforms to Check Frauds X X X X Extracts X X X X X X X X Extracts X X X X ..... ,the following: * Government has issued "Framework for timely detection, reporting, investigation etc. relating to large value bank frauds" to Public Sector Banks (PSBs), for systemic and comprehensive checking of legacy stock of their non-performing assets (NPAs), which provides, inter-alia, that- * all accounts exceeding ₹ 50 crore, if classified as NPAs, be examined by banks from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... angle of possible fraud, and a report placed before the bank's Committee for Review of NPAs on the findings of this investigation; * examination be initiated for wilful default immediately upon reporting fraud to RBI; and * report on the borrower be sought from the Central Economic Intelligence Bureau in case an account turns NPA. * Fugitive Economic Offenders Act, 2018 has been enacted to d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eter economic offenders from evading the process of Indian law by remaining outside the jurisdiction of Indian courts. The act provides for attachment of property of a fugitive economic offender, confiscation of such offender's property and disentitlement of the offender from defending any civil claim. * PSBs have been advised to obtain certified copy of the passport of the promoters/directors a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd other authorised signatories of companies availing loan facilities of more than ₹ 50 crore and, decide on publishing photographs of wilful defaulters, in terms of Reserve Bank of India (RBI)'s instructions and as per their Board-approved policy and to strictly ensure rotational transfer of officials/employees. The heads of PSBs have also been empowered to issue requests for issue of Look ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Out Circulars. * For enforcement of auditing standards and ensuring the quality of audits, Government has established the National Financial Reporting Authority as an independent regulator. * Instructions/advisories have been issued by Government to PSBs to decide on publishing photographs of wilful defaulters, in terms of RBI's instructions and as per their Board-approved policy, and to obtai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n certified copy of the passport of the promoters/directors and other authorised signatories of companies availing loan facilities of more than ₹ 50 crore. * In order to bring transparency and accountability in the larger financial system, bank accounts of 3.38 lakh inoperative companies were frozen over the last two financial years. The impact of the above steps is reflected in RBI's Fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ancial Stability Report (FSR) of June 2019. As per FSR, systemic and comprehensive checking of legacy stock of NPAs of PSBs for frauds has helped unearth frauds perpetrated over a number of years, which is getting reflected in increased number of reported incidents of frauds in recent years compared to previous years. The details of frauds of ₹ 1 lakh and above that occurred during the last ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... three financial years (FYs), reported by PSBs to RBI, as per inputs received from RBI, are as under: FY of occurrence Number of cases Amount involved (in crore Rs.) 2016-17 1,745 24,291 2017-18 1,545 6,916 2018-19 739 5,149 Bank-wise details are at Annex. Note: Figures cited above for PSBs include those for IDBI Bank Limited, which was recategorised as a private sector bank by RB ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I with effect from 21.1.2019. This was stated by Shri Anurag Singh Thakur, Minister of State for Finance & Corporate Affairs in a written reply to a question in Lok Sabha today. **** Annex Details of frauds (Based on date of occurrence - Amount Involved ₹ 1 lakh and above) for Public Sector Banks Amounts in crore Rs. Bank Name FY 2016-17 FY 2017-18 FY 2018-19 Comprehensive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... measures have been taken to prevent frauds including directions to banks to examine all NPA accounts above ₹ 50 crore from the angle of possible fraud, initiation of criminal proceedings, enactment of Fugitive Economic Offenders Act 2018, creation of Central Fraud Registry, empowering Bank Heads to request for issue of Look Out Circular, establishment of National Financial Reporting Authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, Straight through processing between Core Banking System and SWIFT, advice to banks to obtain certified copy of passport of promoters /directors of companies availing loan exceeding ₹ 50 crore etc. Allahabad Bank 63 11 12 Andhra Bank 36 37 11 Bank of Baroda 140 84 32 Bank of India 95 99 52 Bank of Maharashtra 34 32 38 Canara Bank 48 50 24 Central Bank of India 59 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 56 45 Corporation Bank 52 12 5 Dena Bank 24 11 3 IDBI Bank Limited 91 94 99 Indian Bank 70 47 20 Indian Overseas Bank 53 34 30 Oriental Bank of Commerce 42 24 8 Punjab and Sind Bank 22 3 0 Punjab National Bank 101 108 33 State Bank of India 469 618 236 State Bank of Bikaner and Jaipur 5 Merged with SBI Merged with SBI State Bank of Hyderabad 6 State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bank of Mysore
12
State Bank of Patiala
6
State Bank of Travancore
15
Syndicate Bank
127
78
27
UCO Bank
31
41
27
Union Bank of India
83
69
15
United Bank of India
29
15
20
Vijaya Bank
32
22
2
Source: RBI
Note: IDBI Bank Limited was recategorised as a private sector bank by RBI with effect from 21.1.2019.
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