BE/RBINOTE/63/2019
- An alarming report of RBI reveals that the the total frauds in the FY 2018-19 has increased by 74% with a figure of Rs. 71,543 crore.
- The number of fraud cases by lenders also jumped to 6,801 in 2018-19 compared to 5,916 in the FY 2017-18.
- Public Sector Banks accounted for a bulk of frauds reported in 2018-19 -55.4% of the number of cases reported and 90.2% of the amount involved said the Reserve Bank Report.
- This mainly reflected the lack of adequate internal processes, people and systems to tackle operational risks as per the RBI’s report on ‘Trends and Progress of Banking 2018-19.
- In February 2018, the government had issued a framework for timely detection, reporting and investigation of frauds in public sector banks (PSBs).
- It required these lenders to evaluate non-performing accounts exceeding ₹50 crore from the angle of possible frauds, to supplement the earlier efforts to unearth fraudulent transactions.
- This appears to have caused the sharp jump in reported frauds in 2018-19, the report said.
- Private sector lenders and foreign banks accounted for 30.7 per cent and 11.2 per cent, respectively, of the total number of reported fraud in 2018-19. Their share in the amount involved in the frauds reported were 7.7 per cent and 1.3 per cent, respectively.
- PSBs’ share in the value of large frauds was even higher at 91.6 per cent in 2018-19.
- In the bank advances category, there were 3,606 number of fraud cases involving ₹64,548 crore reported in 2018-19.
- The banks reported 13 cases of fraudulent foreign exchange transactions worth ₹695 crore. There were 1,866 fraud cases involving ₹71 crore related to card or internet transactions.
** This story has been published from a wire agency feed without modifications to the actual contents.
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