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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 - News and Press Release Dated:- 10-7-2019 - News - Occurrence of frauds was enabled by laxity in the financial system, and the underlying causes have been systematically dealt with by the Government through comprehensive steps for reduction in occurrence of frauds, and their proactive checking and timely detection. The steps taken in this regard include, inter-alia, 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- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all accounts exceeding ₹ 50 crore, if classified as NPAs, be examined by banks from the 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 deter 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, con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fiscation 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 and 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 Out Circulars. For enforcement of auditing standards and ensuring the quality of audits, Government has established ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 obtain 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 Financial Stability Rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ort (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 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 RBI 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 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 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 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, establis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hment of National Financial Reporting Authority, 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 99 52 Bank of Maharashtra 34 32 38 Canara Bank 48 50 24 Central Bank of India 59 56 45 Corporation Bank 52 12 5 Dena Bank 24 11 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 Bank of Mysore 12 State Ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nk 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 32 22 2 Source: RBI Note: IDBI Bank Limited was recategorised as a private sector bank by RBI with effect from 21.1.2019. ***** - News - Press release - PIB Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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