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In a first, Central Vigilance Commission analyzes top 100 bank frauds

Tuesday October 16, 2018 7:10 PM, News Network

CVC Report on Bank Fraud

New Delhi: In a first, the Central Vigilance Commission has completed analysis of the top 100 banking frauds, including those in the jewellery and aviation sectors, and shared its findings with the RBI, the Enforcement Directorate and the CBI, Vigilance Commissioner TM Bhasin said Tuesday.

The analysis focused on the methods used, amount involved, type of lending (consortium or individual), anomalies observed and loopholes that led to the frauds, along with recommendations to plug the gaps in the system.

According to Ministry of Personnel, Public Grievances & Pensions, the Central Vigilance Commission (CVC) has reviewed and analyzed Top 100 Bank Frauds as on 2017 and shared the 47 pages report with agencies for action.

The report in PDF form has also been uploaded on CVC website.

Sharing the details Vigilance Commissioner TM Bhasin informed that the Commission has sub-divided the study into 13 sectors comprising of Gems and Jewellery, Manufacturing, Agro sector, Media, Aviation, Service Sector, Discounting of cheques and bills, Trading sector, IT Sector, Exports sector, Fixed deposits and Demand Loan etc.

He said that as a conscious decision and with a view to maintaining discreteness, the names of borrower accounts/entities and the names of the Banks have not been disclosed in the report. However, steps are being taken for all encompassing actions such as investigation by the Premier investigative agencies, fixing staff accountability and recovery measures, etc. for effective action.

He said that the modus operandi of these loans has been thoroughly analysed and various loopholes/lapses have been identified. Based on the findings, various industry specific suggestions for systemic improvement have been given in the final report, which have also been sent to Deptt. of Financial Services (DFS)and RBI, in order to plug the loopholes observed by the Commission. The measures suggested include strengthening of SOPs, monitoring system and also highlighting the role of controlling offices, so as examine the aspect of quality of business.

Bhasin said that this analytical study was initiated by the Commission as a Preventive Vigilance measure so as to minimize the occurrence of such type frauds in future. RBI has also confirmed to the Commission that inputs given by CVC are very useful and shall be used for systemic improvements to mitigate the risks.

Bhasin said that the intention of the Commission is to bring about awareness among the field functionaries by enhancing their knowledge towards the existing lapses, so that the frauds of similar nature do not recur. These studies have been done by the Commission as a preventive Vigilance tool by utilizing its vast experience of handling various cases of frauds and Staff accountability related matters.

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