4 Biggest Banking And Market Scams Of India


2. Derivative Scam, 2007-08

In 2007-08 many of the major banks were accused of selling currency derivatives to exporters in an illegal manner. For the most part SMEs, who had very less knowledge about the probable risks of such instruments were involved. The overall losses were anticipated to be over 30, 000 crore.

The regulatory was taken in the year 2011 by the Reserve Bank of India imposing fines starting from 5 to 15 lakhs on nineteen banks for allegedly selling currency derivative products. Though the penalty was considered to be very less and was worthless, it resulted into the end of derivative trade for banks.

3. Citi and Standard Chattered Wealth Management Scam, 2011

Two of the major foreign banks in India, Citi Bank and Standard Chattered Bank were stricken by unprofessional conducts by officials handling wealth management.

Wealth management is a specialized service which is the amalgamation of financial/investment advice, accounting/tax services, and legal/estate planning for one fee. But essentially wealth management is more than just a financial advice service as it can include all parts of a person's financial existence.

The Wealth managers had deceived high net worth clients on alleged reason of exotic products. The Reserve Bank of India is still figuring out guidelines on wealth management.

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