Bank frauds rise in India
Monday, 01 February 2010, 01:57 Hrs | 20 Comments
Crores of rupees have been disappearing from bank accounts or are being used deceitfully everyday. According to Economic Times, recently, a bank branch manager recklessly sanctioned housing loans for the purpose of flats. On the behest of the bank's chief vigilance officer, an on spot verification by the Central Bureau of Investigation (CBI) was conducted, during which it transpired that the three storeyed building was constructed as a hotel.
On further probing it was found that the branch manager had sanctioned many other housing loans against fabricated agreements of sale in fictitious names. By the time, the investigation was completed the bank had been duped of 25 crore.
"This is an alarming scenario. After all, it is people's hard earned money. Globally, banks keep a tight vigil as any slip can bring them down and even impact the economy," says Mayur Joshi, Chairman of Indiaforensic Research Foundation, a Pune-based consultancy which conducts fraud examination and forensic accounting in India.
Information collated by the CBI has shown that, the central investigation body tracks frauds valuing only a crore or above - amount doubled in 2008-09 from 659 crore in 2007-08 to 1,404 crore.
"The focus is on expeditious completion of investigation, close follow up of under-trial cases to conclude them without delay," says a CBI spokesperson. The rising number of frauds has also got the central bank concerned. "It's high time banks strengthen their fraud management practices. In their bid to quickly expand and grow, they are losing focus on risk control," said a senior official of the bank, who did not want to be named.
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