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TMI BlogPrevention of Fraudulent Banking PracticesX X X X Extracts X X X X X X X X Extracts X X X X ..... Prevention of Fraudulent Banking Practices X X X X Extracts X X X X X X X X Extracts X X X X ..... 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- i. all accounts exceeding ₹ 50 crore, if classified as NPAs, be examined by banks from the angle of possible fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aud, and a report placed before the bank's Committee for Review of NPAs on the findings of this investigation; ii. examination be initiated for wilful default immediately upon reporting fraud to RBI; and iii. report on the borrower be sought from the Central Economic Intelligence Bureau in case an account turns NPA. 2. Fugitive Economic Offenders Act, 2018 has been enacted to deter economic o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ffenders 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. 3. PSBs have been advised to obtain certified copy of the passport of the promoters/directors and other author ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ised signatories of companies availing loan facilities of more than ₹ 50 crore and, decide on publishing photographs of wilful defaulters, in terms of the instructions of RBI 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 Out Circulars. 4. For enforcement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of auditing standards and ensuring the quality of audits, Government has established the National Financial Reporting Authority as an independent regulator. 5. 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 obtain certified copy of the passport o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the promoters/directors and other authorised signatories of companies availing loan facilities of more than ₹ 50 crore.
6. 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.
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