A Study of frauds in banking sector & security measures taken by bank A Project Submitted to
University of Mumbai for partial completion of the degree of Bachelor in Commerce (Banking and Insurance) Under the Faculty of Commerce
By Kajal Tripathi Under the Guidance of Ms. Foram Toprani
Guru Nanak College of Arts, Science and Commerce,
G.T.B. Nagar, Mumbai-400037.
2018-2019
1
Acknowledgement I would like to acknowledge the following as being idealistic channels and fresh dimension in the completion of this project. I take this opportunity thank the University of Mumbai for giving me chance to do this project. I would like to thanks my I\C Principal Dr. Pushpinder G.Bhatia for providing the necessary facilities required for completion of this project. I take this opportunity to thank our CoordinatorMs. Janshi Rengaswamy for her moral support and guidance. I would like to express my sincere gratitude towards my project guidance Ms. Foram Toprani whose guidance and care made the project successful. I would like to thank my College Library, for having provided various references books and magazines related to my project. Lastly I would like to thank each and every person who directly or indirectly helped me in the completion of the project especially my Parents and Peers who supported me throughout my project.
2
Declaration I the undersigned Mr. /Ms. Kajal Tripathi here by, declare that the work embodied in this project work titled “A Study of frauds in banking sector & security measures taken by bank forms my own contribution to the research work carried out under the guidance of Ms. Foram Toprani is a result of my own research work and has not been previously submitted to any other university for any other Degree/Diploma to this or any other university. Wherever references have been made to previous works of others, it has been clearly indicated as such and included in the bibliography.
Name and Signature of the learner
Certified by
Name and signature of the Guiding Teacher
3
Guru Nanak College of Arts, Science and Commerce, G.T.B Nagar, Mumbai400037 Certificate This is to certify that Ms. Kajal Tripathi has worked and duly completed her Project work for the degree of Bachelor of Commerce (Banking and Insurance) under the faculty of Commerce in the subject of Information technology in Banking and Insurance-1 and his Project is entitled, “A Study of frauds in banking sector & security measures taken by bank” under my supervision. I further certify that the entire work has been done by the learner under my guidance and that no part of it has been submitted previously for any Degree or Diploma of any University. It is his own work and facts reported by his personal findings and investigations.
Name and Signature of Guiding Teacher
Date of submission:
4
ABSTRACT The number of bank frauds in India is substantial and it is increasing with the passage of time and technology. The Indian banking sector has experienced considerable growth and changes since liberalisation of economy in 1991. The frauds may be primarily due to lack of adequate supervision of top management, faulty incentive mechanism in place for employees; collusion between the staff, corporate borrowers and third party agencies; weak regulatory system; lack of appropriate tools and technologies in place to detect early warning signals of a fraud; lack of awareness of bank employees and customers; and lack of coordination among different banks across India and abroad. The delays in legal procedures for reporting, and various loopholes in system have been considered some of the major reasons of frauds and NPAs. Keywords: Non-performing assets, Stressed assets, Banking frauds. Though the banking industry is generally well regulated and supervised, the sector suffers from its own set of challenges when it comes to ethical practices, financial distress and corporate governance. This study endeavours to cover issues such as banking frauds , with a detailed analysis using secondary data (literature review and case approach) as well as an interview-based approach, spanning across all players involved in reporting financial misconduct. The study finally proposes some recommendations to reduce future occurrence of frauds in Indian banking sector. Keywords: Bank frauds, developing economy, RBI, internal control, use of technology.
5
INDEX
SR.NO PARTICULARS
PAGE.NO
Abstract 1
2
3
5
Chapter no 1: Introduction
7-9
1.1Selection & relevance of problem
10
1.2Historical background of problem
11-12
1.3Concept of fraud
13-14
1.4Three elements of fraud
15
Chapter no 2: Research Methodology 2.1Objective of study
16
2.2Need of the study
17
2.3Signification of study
18
2.4Various aspects of bank fraud
19-22
2.5Reasons for bank fraud
23-24
2.6Classification of fraud
25-26
2.7Reporting of fraud
27-30
2.8Closure of fraud cases
31-32
2.9Types of fraud
33-38
2.10Recent trends
39-40
2.11 Relevant issues to tackle bank fraud in India
41-43
Chapter no 3 :Literature Review Jeffords etal(1992)
44
Willson(2006)
44
Bhasin(2007)
44
Ganesh & Raghurama(2008)
44
4
Chapter no 4:Data Analysis & Interpretation
45-55
5
Chapter no 5:Conclusion & suggestion
56-59
6
Chapter no 6: Bibilography
60
6
Chapter 01 Introduction :
BANKS are the engines that drive the operations in the banking sector ,money market and growth of economy. With the growing banking industry in India, frauds in banks are also increasing . The Indian banking sector has experienced considerable growth and changes since liberalisation of economy in 1991. Though the banking industry is generally well regulated and supervised, the sector suffers from its own set of challenges when it comes to ethical practices, financial distress and corporate governance. In recent years, instances of financial fraud have regularly been reported in India. Although banking frauds in India have often been treated as cost of doing business, post liberalisation the frequency, complexity and cost of banking frauds have increased manifold resulting in a very serious cause of concern for regulators, such as the Reserve Bank of India (RBI). RBI, the regulator of banks in India, defines fraud as “A deliberate act of omission or commission by any person, carried out in the course of a banking transaction or in the books of accounts maintained manually or under computer system in banks, resulting into wrongful gain to any person for a temporary period or otherwise, with or without any monetary loss to the bank”
A well-organized and efficient banking system is an essential pre-requisite for the economic growth of every country. In modern era, banking industry plays an important role in the functioning of organized money markets, and also acts as a conduit for mobilizing funds and 7
channelizing them for productive purposes. It is universally accepted that for the smooth functioning of a money market and economic growth of a country, an efficient and good banking system is a must. The Indian banking industry is unique and has no parallels in the banking history of any country in the world. After independence, the banking sector has passed through three stages: character-based lending to
ideology-based lending to
competitiveness-based lending.” The frauds may be primarily due to lack of adequate supervision of top management, faulty incentive mechanism in place for employees; collusion between the staff, corporate borrowers and third party agencies; weak regulatory system; lack of appropriate tools and technologies in place to detect early warning signals of a fraud; lack of awareness of bank employees and customers; and lack of coordination among different banks across India and abroad. The delays in legal procedures for reporting, and various loopholes in system have been considered some of the major reasons of frauds and NPAs. Keywords: Non-performing assets, Stressed assets, Banking frauds. Fraud is a social evil it affect the entire sector of the economy which banking system is inclusive although fraud and loss in an expected part of any business activity the scope and gravity is what creates concern in a developing economy like ours. Fraud in banking sector is generally looked at as acts that involve the loss of asset a through deceitful and dishonest means. It certainly constitutes one of the most serious threat to the practice and spread of banking. Bank fraud is a criminal act that occurs when a person uses illegal means to receive money or assets from a bank or other financial institution. Bank fraud is distinguished from bank robbery by the fact that the perpetrator keeps the crime secret, in the hope that no one notices until he has gotten away. The term bank fraud also refers to attempts by a person to obtain money from a bank’s depositors by falsely pretending to be a bank or financial institution. The financial services sector faces cyber and physical threats from a great variety of sources as it is the most financially attractive sector. With the increased usage of information and communication technology for various financial affairs and with the increasing popularity of alternate channels of banking, a better security infrastructure is the need of the hour for the Indian financial services sector.
8
What is Fraud? Bank can be defined as an unethical and/or criminal act by an individual or organization to illegally attempt to possess or receive money from a bank or financial institution.
Bank fraud is the use of potentially illegal means to obtain money, assets or other property owned or held by a financial institution, or to obtain money from depositors by fraudulently posing as a bank or other financial institution. In many instances, bank fraud is a criminal offence. While the specific elements of particular banking fraud laws vary depending on
jurisdictions, the term bank fraud applies to actions that employ a scheme or artifice, as opposed to bank robbery or theft. For this reason, bank fraud is sometimes considered a white line cover.
The Institute of Internal Auditors „International Professional Practices Framework‟ (2009) defines fraud as, “Any illegal act characterized by deceit, concealment, or violation of trust. Frauds are perpetuated by parties to obtain money, property or services; to avoid payment, or loss of services; or to secure personal or business advantage.” It should be noted
that
frauds generally impacts a bank by causing financial, operational or
psychological loss.
Pasricha and Mehrotra (2014) observed that “one of the most
challenging aspects in the Indian banking sector is to make banking transactions free from electronic crime.” All the major operational areas in banking offer a good opportunity for fraudsters, especially in deposit, loan and inter-branch transactions. However, Bhasin (2011) concluded, “Frauds generally take place in banks when safeguards and procedural controls are inadequate, or when they are not carefully followed, thus
providing ample
opportunities to the fraudsters. Frauds are increasing and fraudsters are becoming more sophisticated and ingenious.” Similarly, a researcher Banks (2004) remarked, “Most of the time, it is difficult to detect frauds well-in-time, and even more difficult to book the offenders because of intricate .
9
1.1 Selection & relevance of problem Generally speaking professional fraud is new not just because it exposes the societies anemone and raise important questions of public interest which follows this
Fraud is banks nearly leads to lose of money ordinarily belongs to some one other than the bank.
In every bad conditions where fraud occurs with crippling frequency and in wholesale sizes the bank may be forced to liquidate consequently and drastic reduction of patronage in the banking sectors.
The effect of fraud equally dastards management policy to encompass cheek and control system which are by them costly to maintain.
Bankers as a matter of urgency are expected to be very careful in the detection for costing and prevention of fraud to help cub and cushion the effect of the menace.
10
1.2 Historical background of problem Bank frauds and bank crises have been an integral part of Indian financial history. It is not for nothing that in 1913, John Maynard Keynes after surveying the state of banking in the country, wrote in Indian Currency and Finance, “In a country so dangerous for banking as India, (it) should be conducted on the safest possible principles". His warnings have proven prophetic. In fact, scams in Indian banking far predate Keynes’s warnings. The year 2017 was the 150th anniversary of the failure of the Presidency Bank of Bombay (PBB). The bank had been started by the East India Company in 1840. It was stable and run prudently till the mid1860s. This was the period when the British started relying extensively on Bombay cotton markets, as supplies from the US had declined due to the civil war. Thus, lots of cotton companies and banks began to spring up in Bombay catering to a booming demand for capital. It is in this environment that PBB began to issue loans recklessly against shares of private companies and even on just personal security. Then, as the civil war ended, the euphoria in the Indian cotton market turned to panic. The hitherto stable bank came to a swift close. A new Bank of Bombay was established immediately in 1868—financial institutions were, of course, central to the colonial project. If one reads into the details of the PBB scam as given in Amiya Kumar Bagchi’s history of State Bank of India, the scam is not all that different from the recent events at PNB. The main difference is that while PBB failed, hopefully neither PNB nor Bank of Baroda is headed in that direction. Even before PBB, there were several bank failures in Calcutta. Several banking organizations mushroomed in the early 18th century, as economic activity concentrated in Calcutta. However, again, the same problems surfaced—overextended balance sheets, accounting fraud, et cetera. At the time bankers in Calcutta blamed the fact that banks had unlimited liability. Subsequently, in 1861, British authorities allowed banks to have limited liability, only for the PBB collapse to show that accounting regulations and reforms can only do so much for prudent banking. 11
One response to recent scams has been to point fingers at public sector banks, and suggest that privatization would create the right incentives. But Indian history is, in fact, replete with banking failures in the private and public sectors. Fast-forward to 1905 and we see another period of euphoria in Indian banking, this time due to the Swadeshi movement. Arising out of the political foment unleashed by the partition of Bengal, the movement called for Swadeshi banks to fund Swadeshi enterprises. The entrepreneurial response was overwhelming. By 1913, there were 451 banking companies (accoring to Bakhtiar Dadabhoy's Barons of Banking). No prizes for guessing what happened next. Following runs, prominent banks such as Indian Specie Bank and People’s Bank of India collapsed. The case of Indian Specie Bank is interesting—it had forwarded large loans to a prominent pearl merchant. When the merchant’s business collapsed, so did the bank. In December 1913 one newspaper, The Colonist, said that if the bank’s management had released balance sheets, the fraud could have been detected well in advance of the collapse. A refrain that is all too common to this day. Most of the banking failures in the 1910s took place in Punjab. In 1913-14, out of 54 closed banks, 28 were from Punjab and 11 from Bombay. The location of failures then shifted significantly towards southern India and West Bengal. The period of 1913-66 sees nearly 1800 banks failing—25% in Kerala, 21% in West Bengal and 20% in Madras. For a while these collapses were blamed on the lack of a central bank. Indeed, nearly 350 banks all over India closed between 1913 and 1934. In 1934 India finally got its own central bank. Sure this central bank could now stem the rot in Indian banking? Hardly. Banks continued to fail at an alarming rate. Between 1935 and 1947, nearly 900 banks failed followed by 665 banks in the period from 1947 to nationalization in 1969. So much so, in 1950 an elderly citizen from West Bengal wrote to prime minister Jawaharlal Nehru complaining that small depositors who lost their deposits in these banks "scheduled and affiliated [sic] by the Reserve Bank" had come to the conclusion that the central bank was "only meant for the Big Pandas who ... only know how to squeeze" the poor and who were "sleeping with oil in their noses" (RBI History 1951-67). .
12
1.3 CONCEPT OF FRAUD “There are three things in the world that deserve no mercy - hypocrisy, fraud and tyranny.” Frederick William Robertson. The saying signifies how dangerous frauds are for the society, especially in financial terms. The Oxford dictionary defines fraud as a wrongful or criminal deception intended to result in financial or personal gain. Fraudulent activities may result in benefits for a very small fraction of the population, but at times the volume of these frauds amount to alarming numbers. Cressey (1973) developed a model for explaining the factors that cause someone to commit occupational fraud and named it fraud triangle. It consists of three components which, together, lead to fraudulent behavior: Perceived unshareable financial need; Perceived opportunity; Rationalization Fraud is any dishonest act and behavior by which one person gains or intends to gain an advantage over another person. The gain may accrue to the person himself or to someone else. Fraud causes loss to the victim, directly or indirectly. In earthly terms bank frauds include all sort of misappropriations, embezzlements, and manipulations of negotiable instruments (cheques, drafts, hundies, bills or statements of accounts, securities etc.). Fraud also includes misrepresentations, cheating, thefts, undue favors and irregularities.
The word fraud has been defined in law in the Indian Contract Act, section 17: ‘Fraud’ means and includes any of the following acts committed by a party to a contract, or with his connivance, or by his agent, with intent to deceive another party thereto or his agent, or to induce him to enter into the contract: 1. The suggestion as a fact, of that which is not true, by one who does not believe it to be true; 2. The active concealment of a fact by one having knowledge or belief of the fact; 3. A promise made without any intention of performing it; 4. Any other fact fitted to deceive; 5. Any such act or omission as the law specially declares to be fraudulent. 13
Fraud in the financial services industry poses a significant risk to institutions and integrity of capital markets. Its effects can be widespread and cause not only long term financial but also reputational damage. According to the survey financial sector is most vulnerable to fraud as compared to other sectors. Moreover, the cost of fraud does not stop at a monetary figure; its insidious nature has other serious implications including • Reputation risk • Adverse regulatory and media attention • Reduced profits • Decrease in company value/share price • Decreased efficiency of employees • Negative impact on morale, trust and workplace culture • Disruption in business continuity
14
1.4 Three Elements of Fraud Detection Frauds can be detected in all three elements. First, in the theft act, someone is a witness the perpetrator taking cash or other assets. Second, in concealment, altered records or miscounts of cash or inventory can be recognized. Third, in conversion, the lifestyle changes that perpetrators almost inevitably make when they convert their embezzled funds are visible
Theft: The theft act involves the actual taking of cash, inventory, information, or other assets. Theft can occur manually, by computer, or by telephone.
Concealment: It involves the steps taken by the perpetrator to hide the fraud from others. Concealment can involve altering financial records miscounting cash or inventory, or destroying evidence.
Conversion: It involves selling stolen assets or transforming them into cash and then spending the cash. If the asset taken is cash, conversion means merely spending the stolen funds. .
15
CHAPTER 2- RESEARCH METHODOLOGY 2.1 OBJECTIVE OF THE STUDY The aim and objectives of this study are as follows:
To establish the cause of fraud and event that facilitates this act.
To find out the various forms and nature of commercial fraud that provide the system To keep the general public aware of the hazardous effects of fraud in the banking industry.
To keep the management and its subordinate alert in a way to fight against fraud among back employee they are customer shareholders and the general public.
To find possible solution and control means of fraud in the banking system in a bid to save the economy raise the profitability of bank and to save the image of banking sector.
16
2.2 Need of the Study
In the banking sector due to increase usage of internet and other channels for financial transactions there is an increase in the number of security incidents threats/vulnerabilities. In the current scenario, each bank is tracking and finding the resolutions for the incidents independently without any collaborated effort between banks. Each bank is facing the similar kind of security incidents.
Having a common Center for analysis of risks and threats helps the bankers in sharing the incidents as well as the resolutions across the banking sector. It will act as knowledge repository of security incidents for the entire banking industry.
The requirement growing for information sharing and analysis in the financial services sector in India.
The advantage about forming such a body in India increases the technology growth and faces challenges in financial sector services.
17
2.3 SIGNIFICATION OF STUDY The banking institution as an engine for economic development is specially designed to carry out contains duties which eventually benefits the following interest groups are ● Industrial sector ● Agricultural sector ● Individual customers ● Government or public sector
INDUSTRIAL SECTOR: Industrial seek loan and advance form commercial bank to meet their business financial revilements. The bank accommodate them by providing permanent financial in the form of loans the working capital needs are met through bank overdraft facilities. The funds are however made available to loan seeker who met the lending condition laities of the banks.
AGRICULTURAL SECTOR: Development banks are needed to finance specific project particularly the types which private institution cannot easily be induced to finance specially when they are largely experimental in nether taking the high risk that surrounds the agriculturist into consideration such as gestation period nature disaster pest & disease. International Journal of Pure and Applied Mathematics Special Issue.
INDIVIDUAL CUSTOMERS: Banks as custodian of high liquidity keeps safe the customers deposits which are payable on demand grants overdraft especially to current account holder discounts the customers commercial papas and pays their customers a sum entire in money as ordered by their debtor.
GOVERNMENT OR PUBLIC SECTOR: Bank is an avenue through which government controls the economic activities of the country through the use of C.B.N as the apex bank that implements the monetary policy measures on banks and other non-bank financial institution in the country. 18
2.4 Various aspects of bank frauds Broadly, the frauds reported by banks can be divided into three main sub-groups:
1.KYC RELATED After the international focus on KYC, RBI brought a paradigm shift in the approach to KYC by banks in India. It moved away from introduction to document based identification hence introduction is no more required. It also shifted the focus from financial loss (from frauds) to the banks to the loss of reputation to the banks (by non-compliance). The other principles are that the KYC information collected is to be consistent with risk perception and other information to be collected only with consent of the customer and the KYC related information is confidential - not to be divulged for cross-selling or any other purpose. RBI has prescribed that the KYC policy of banks should have the following key elements: i.
Customer Acceptance Policy
ii.
Customer Identification Procedures
iii.
Monitoring of Transactions, and
iv.
Risk Management If one were to carefully observe, each of the elements is intended to make the customer-bank relationship a fraud-free one. Fraudulent documentation involves altering, changing or modifying a document to deceive the bank. It can also involve approving incorrect information provided in documents knowingly (cases of connivance of bank staff with fraudsters). Deposit accounts in banks with lax KYC drills/ inoperative accounts are vulnerable to fraudulent documentation.
2.ADVANCES RELATED Frauds related to the advances portfolio accounts for the largest share of the total amount involved in frauds in the Indian banking sector. Increase in the cases of large value fraud (involving amount of Rs. 50 crore and above) in accounts financed under consortium or multiple banking arrangements involving even more than 10 banks at times, is an unwelcome trend in the banking sector. Another point that needs to be highlighted here is that public sector banks 19
account for a substantial chunk of the total amount involved in such cases. Majority of the credit related frauds are on account of deficient appraisal system, poor post disbursement supervision and inadequate follow up. a. Siphoning of funds takes place when funds borrowed from banks are utilised for purposes unrelated to the operations of the borrower. b. Diversion of funds includes any one of the following occurrences:
Use of short-term working capital funds for long-term commitments not in conformity with the terms of sanction
Using borrowed funds for creation of assets other than those for which the loan was sanctioned
Transferring funds to group companies
Investment in other companies by acquiring shares without the approval of lenders
Shortage in the usage of funds as compared to the amounts disbursed/ drawn, with the difference not being accounted for
c. Over-valuation or absence of requisite collaterals
3.Technology related In 2014, around 65% of the total fraud cases reported by banks were technology-related frauds (covering frauds committed through / at an internet banking channel, ATMs and other payment channels like credit/debit/prepaid cards). Business and technology innovations that the banking sector is adopting in their quest for growth are in turn presenting heightened levels of cyber risks. These innovations have probably introduced new vulnerabilities and complexities into the system. For example, the continued adoption of web, mobile, cloud, and social media technologies has increased opportunities for attackers. Similarly, the waves of outsourcing, offshoring, and third-party contracting driven by a cost reduction objective may have further diluted institutional control over IT systems and access points. These trends have resulted in the development of an increasingly boundary-less ecosystem within which banking companies operate, and thus a much broader “attack surface” for the fraudsters to exploit.
Hacking: Hackers/fraudsters obtain unauthorized access to the card management system of the respective bank. Counterfeit cards are then issued for the purpose of money laundering. 20
Phishing: A technique used to obtain your card and personal details through a fake email .
Pharming: A similar technique where a fraudster installs malicious code on a personal computer or server. This code then redirects clicks you make on a Website to another fraudulent Website without your consent or knowledge
Vishing: Fraudsters also use the phone to solicit your personal information.
Smishing: It uses cell phone text messages to lure consumers in. Often the text will contain an URL or phone number. The phone number often has an automated voice response system. And again just like phishing, the smishing message usually asks for your immediate attention.
Debit card skimming: A machine or camera is installed at an ATM which picks up card related information and PIN numbers when customers use their cards.
Counterfeit instruments: Fake cheques / Demand Drafts that look too good to be true are being used in a growing number of fraudulent schemes, including foreign lottery scams, cheque overpayment scams, internet auction scams and secret shopper scams. With the growing business of mobile banking, it is essential that we devote exclusive space and time to this aspect / mode of banking.
21
Fake apps: The first step in stealing money online is to steal information. This can be done by creating a fake app outside a play store. Hackers create fake apps which will looks exactly as the original one and the usage & interface is similar to the original app.
22
2.5 Reasons for bank frauds
i.
Lack of oversight by concerned officer’s w.r.t. deviation management: With existing systems and procedures clearly defined, it is the onus on the senior management to allow specific deviations. Lack of seriousness and knowledge regarding the same may create havoc and lead to a fraud.
ii. Non adherence to KYC guidelines as prescribed by RBI: In the haste of increasing the CASA base of respective branches (or any unit), KYC requirements are compromised. RBI has recently fined banks for non-adherence to KYC norms. The concurrent auditor, who visits the branch once in a month, points out those KYC guidelines which are not followed by the branch and asks it to obtain proof and confirm. This takes another month or so. During this lean period, fraudsters open deposit accounts, deposit forged stolen cheques and withdraw the amount. iii. Increasing business pressure on staff: Margins, profitability and shareholders expectations being under strain, the management passes on to the middle management who in turn have the same transmitted to the line staff. Staff may use unscrupulous methods to achieve their respective targets. v.
Lack of tools to identify potential red flags: Some organisations even if they have the correct, agile and educated managers, there may be absence of suitable systems to give the necessary signals during the course of a loan turning bad or a KYC being violated etal.
vi.
The symptoms of poor internal control systems increase the chances of frauds. Internal control symptoms include a poor control environment, lack of segregation of duties, lack of physical safeguards, lack of independent checks, lack of proper authorizations, lack of proper documents and records, the overriding of existing controls, and an inadequate accounting system.
vii.
vi. Changes in technology: The new technologies adopted by banks are making them increasingly vulnerable to various risks such as phishing, identity theft, card skimming, vishing, SMSishing, viruses and Trojans, spyware and adware, social engineering, website cloning and cyber stalking. Banking transactions today have moved to debit/ credit cards and to electronic channels like ATMs, RTGS/ NEFT, ECS/NECS, Internet 23
banking and Mobile banking. This has given a happy hunting ground to fraudsters. Infact all these alternate channels are being promoted by each of the commercial banks to reduce the pressure on branch banking. viii.
vii. Collusion between employees and external parties: Insider fraud, whether arising from coercion, collusion, or otherwise, are increasingly considered to be one of the most serious fraud threats faced by banks in India. Infact it does not require sophisticated learning to decipher that the frauds happening today are not an act of an individual.
ix.
viii. Inexperienced staff: People with no or little experience or exposure to loans/advances are posted to branches which have large advances portfolio and are compelled to process loan proposals.
24
2.6 CLASSIFICATION OF FRAUDS In order to have uniformity in reporting, frauds have been classified as under, based mainly on the provisions of the Indian Penal Code: a. Misappropriation and criminal breach of trust. b. Fraudulent encashment through forged instruments, manipulation of books of account or through fictitious accounts and conversion of property. c. Unauthorised credit facilities extended for reward or for illegal gratification. d. Negligence and cash shortages. e. Cheating and forgery. f. Irregularities in foreign exchange transactions. g. Any other type of fraud not coming under the specific heads as above.
Cases of 'negligence and cash shortages' and 'irregularities in foreign exchange transactions' referred to in item (d) & (f) above are to be reported as fraud if the intention to cheat/defraud is suspected/ proved. However, the following cases where fraudulent intention is not suspected/proved at the time of detection will be treated as fraud and reported accordingly: (a) cases of cash shortages of more than ₹10,000 and (b)
cases
of
cash
shortages
of
more
than
₹
5,000
if
detected
by
management/auditor/inspecting officer and not reported on the day of occurrence by the persons handling cash. To ensure uniformity and to avoid duplication, frauds involving forged instruments may be reported only by the paying banker and not by the collecting banker.
However, in the case of collection of an instrument which is genuine but the amount is collected fraudulently by a person who is not the true owner, the collecting bank, which is defrauded, will have to file fraud report with the RBI.
25
In case of collection of instrument where the amount has been credited and withdrawn before realisation and subsequently the instrument is found to be fake/forged and returned by the paying bank, it is the collecting bank who has to file FMR-1 with the RBI as they are at loss by parting the amount before realisation of the instrument.
Encashment of altered / fake cheques involving two or more branches of same bank
In case of collection of altered/fake cheque involving two or more branches of the same bank, the branch where the altered/fake cheque has been encashed, should report the fraud to Head Office of the bank. Thereafter, Head Office of the bank will file the fraud report with RBI.
In the event of an altered/fake cheque having been paid/encashed involving two or more branches of a bank under Core Banking Solution (CBS), there could be a possibility of dispute/difference of opinion as to whether the branch where the drawer of the cheque maintains the account or the branch where the encashment has taken place should report the matter to the Head Office of the bank. In such cases also the branch which has released the payment against an altered / fake cheque should report the fraud to the Head Office. Thereafter, Head Office of the bank will file the fraud report with RBI.
26
2.7 REPORTING OF FRAUDS TO RESERVE BANK OF INDIA Frauds involving amounts of less than ₹ 1.00 lakh The cases of individual frauds involving amounts of less than ₹ 1.00 lakh are not to be reported individually to the RBI. Statistical data in respect of such frauds should, however, be submitted to RBI in a quarterly statement as detailed in Para 4.1.
Frauds involving amounts of ₹ 1.00 lakh and above but less than ₹ 25.00 lakh
The cases of individual frauds involving amounts of ₹ 1.00 lakh and above but less than ₹.25.00 lakh should be reported to the Regional Office of Department of Cooperative Bank Supervision of Reserve Bank of India, under whose jurisdiction the Head Office of the bank falls, in the format given in FMR-1, within three weeks from the date of detection. Frauds committed by unscrupulous borrowers It is observed that a large number of frauds are committed by unscrupulous borrowers including companies, partnership firms/proprietary concerns and/or their directors/partners by various methods including the following: (i) Fraudulent discount of instruments or kite flying in clearing effects. (ii) Fraudulent removal of pledged stocks/disposing of hypothecated stocks without the bank’s knowledge/inflating the value of stocks in the stock statement and drawing excess
Provisioning Pertaining to Fraud Accounts It has been decided to prescribe a uniform provisioning norm in respect of all cases of fraud, as under : (a) The entire amount due to the bank (irrespective of the quantum of security held against such assets), or for which the bank is liable (including in case of deposit accounts), is to be provided 27
for over a period not exceeding four quarters commencing with the quarter in which the fraud has been detected; (b) However, where there has been delay, beyond the prescribed period, in reporting the fraud to the Reserve Bank, the entire provisioning is required to be made at once. In addition, Reserve Bank of India may also initiate appropriate supervisory action where there has been a delay by the bank in reporting a fraud, or provisioning there against. REPORTS TO THE BOARD Reporting of Frauds Banks should ensure that all frauds of ₹ 1.00 lakh and above are reported to their Boards promptly on their detection. Such reports should, among other things, take note of the failure on the part of the concerned branch officials and controlling authorities, and consider initiation of appropriate action against the officials responsible for the fraud. Quarterly Review of Frauds Information relating to frauds for the quarters ending June, September and December may be placed before the Audit Committee of the Board of Directors during the month following the quarter, to which it pertains, irrespective of whether or not these are required to be placed before the Board / Management Committee in terms of the Calendar of Reviews prescribed by the Reserve Bank of India. A separate review for the quarter ending March is not required in view of the Annual Review for the year ending March prescribed below. The review for the year ended March may be placed before the Board before the end of next quarter. i.e. for the quarter ended June 30. Special Commitee of Board for Monitoring High Value Frauds As delay in various aspects of frauds like detection, reporting to regulatory and enforcement agencies and action against the perpetrators of the frauds had been causing concern, the need was felt for paying focused attention on monitoring of frauds at the highest level and it was suggested to constitute a subcommittee of the Board which would be exclusively dedicated to the monitoring of fraud cases. It has therefore been decided that Boards of banks should constitute a 28
Special Committee for monitoring and following up cases of frauds involving amounts of Rs.1 crore and above exclusively, while ACB may continue to monitor all the cases of frauds in general. (i) The broad guidelines regarding constitution and functions of the Special
Committee of the Board are follows : a) Constitution of the Special Committee The Special Committee may be constituted with five members of the Board of Directors including Chairman, two members from ACB, and two other members from the Board.
b) Functions of Special Committee The major functions of the Special Committee would be to monitor and review all the frauds of Rs.1 crore and above so as to;
c) Meetings The periodicity of the meetings of the Special Committee may be decided according to the number of cases involved. However, the Committee should meet and review as and when a fraud involving an amount of Rs.1 crore and above comes to light.
Annual Review of Frauds Banks should conduct an annual review of the frauds and place a note before the Board of Directors for information. The main aspects which may be taken into account while making such a review may include the following: a) Whether the systems in the bank are adequate to detect frauds, once they have taken place, within the shortest possible time. b) Whether frauds are examined from staff angle and, wherever necessary, the staff side action is taken without undue delay.
29
c) Whether deterrent punishment is meted out, wherever warranted, to the persons found responsible without undue delay. d) whether frauds have taken place because of laxity in following the systems and procedures or loopholes in the system and, if so, whether effective action has been taken to ensure that the systems and procedures are scrupulously followed by the staff concerned or the loopholes are plugged. e) Whether frauds are reported to the local Police for investigation.
30
2.8 CLOSURE OF FRAUD CASES Banks will report to the concerned Regional Office of Department of Cooperative Bank Supervision of Reserve Bank of India under whose jurisdiction the Head Office of the bank falls, the details of the fraud cases closed along with reasons for the closure where no further action was called for. Fraud cases closed during the quarter are required to be reported in quarterly return FMR-2. Banks should report only such cases of frauds as closed where the actions as stipulated below are complete. a. The fraud cases pending with Police/Courts are finally disposed. b. The examination of staff accountability has been completed. c. The amount of fraud has been recovered or written off. d. Insurance claim, wherever applicable, has been settled. e. The bank has reviewed the systems and procedures, identified the causative factors and plugged the lacunae and the fact of which has been certified by the Board. Banks should also pursue vigorously with the Police/Court for final disposal of the pending cases especially where the banks have completed staff side action.
31
GUIDELINES FOR REPORTING OF FRAUDS TO POLICE Banks should follow the following guidelines for reporting of frauds such as unauthorised credit facilities extended by the bank for illegal gratification, negligence and cash shortages, cheating, forgery, etc. to the State Police authorities: (a) In dealing with cases of fraud/embezzlement, banks should not merely be motivated by the necessity of recovering expeditiously the amount involved, but should also be motivated by public interest and the need for ensuring that the guilty persons do not go unpunished. (b) Therefore, as a general rule, the following cases should invariably be referred to the State Police: i. Cases of fraud involving an amount of ₹ 1.00 lakh and above, committed by outsiders on their own and/or with the connivance of bank staff/officers. ii. Cases of fraud committed by bank employees, when it involves banks' funds exceeding ₹ 10,000
32
2.9 Types of fraud 1. Identity fraud 2. Phishing 3. Hacking 4. Credit card fraud 5. Fraudulent loans 6. Stolen payments cards 7. Fake prizes 8. Inheritance scams 9. International lottery fraud 10. Wills and legacies
33
1.identity theft
Identity fraud is often a two-stage process where your personal details are stolen and then used for financial gain or other criminal activity. You might be left with debt, a poor credit rating or other legal implications as a result. Personal information such as your name, address, date of birth or bank account details can be obtained by criminals in a number of ways including phishing, hacking
Identity theft is the deliberate use of someone else's identity, usually as a method to gain a financial advantage or obtain credit and other benefits in the other person's name. Identity theft occurs when someone uses another's personally identifying information, like their name, identifying number, or credit card number, without their permission, to commit fraud or other crimes.
How identity theft happens There are a lot of ways identity theft can happen to you. Hackers may get your information from a data security breach. Or, you may unknowingly provide it on social media, during conversions others can hear or by leaving financial documents in unsafe places. That information may include:
Social Security number
Full name, address and birth date
Credit card or bank account numbers 34
Car insurance or medical insurance account numbers
2.Phising Phishing is a type of social engineering attack often used to steal user data, including login credentials and credit card numbers. It occurs when an attacker, masquerading as a trusted entity, dupes a victim into opening an email, instant message, or text message. The recipient is then tricked into clicking a malicious link, which can lead to the installation of malware, the freezing of the system as part of a ransomware attack or the revealing of sensitive information.
An attack can have devastating results. For individuals, this includes unauthorized purchases, the stealing of funds, or identify theft.
The following illustrates a common phishing scam attempt: 1. A spoofed email ostensibly from myuniversity.edu is mass-distributed to as many faculty members as possible. 2. The email claims that the user’s password is about to expire. Instructions are given to go to myuniversity.edu/renewal to renew their password within 24 hours.
35
3.Hacking Hacking occurs when a scammer gains access to your personal information by using technology to break into your computer, mobile device or network. Hacking is identifying weakness in computer systems or networks to exploit its weaknesses to gain access. Example of Hacking: Using password cracking algorithm to gain access to a system Computers have become mandatory to run a successful businesses. It is not enough to have isolated computers systems; they need to be networked to facilitate communication with external businesses..
4.Credit card Credit card fraud is when someone uses your credit card or credit account to make a purchase you didn't authorize. This activity can happen in different ways: If you lose your credit card or have it stolen, it can be used to make purchases or other
transactions, either in person or online. Fraudsters can also steal your credit card account number, PIN and security code to make
unauthorized transactions, without needing your physical credit card. (Unlawful transactions like these are known as card-not-present fraud.)
36
Types of credit card fraud 1. Stealing a credit card 2. Using a lost or found credit card 3. Account takeover 4. Fraudulent applicatons 5. Card-not-present
5.Fraudulent loans:
One way to remove money from a bank is to take out a loan, which bankers are more than willing to encourage if they have good reason to believe that the money will be repaid in full with interest. A fraudulent loan, however, is one in which the borrower is a business entity controlled by a dishonest bank officer or an accomplice; the "borrower" then declares bankruptcy 37
or vanishes and the money is gone. The borrower may even be a non-existent entity and the loan merely an artifice to conceal a theft of a large sum of money from the bank. This can also be seen as a component within mortgage fraud
6. Stolen payments card
Often, the first indication that a victim's wallet has been stolen is a phone call from a credit card issuer asking if the person has gone on a spending spree; the simplest form of this theft involves stealing the card itself and charging a number of high-ticket items to it in the first few minutes or hours before it is reported as stolen.
38
2.10 Recent Banking Frauds In India PNB scam On February 14 this year, the state-run lender PNB shocked the entire banking industry of India by revealing that it had been defrauded by Rs 11,400 crore allegedly by billionaire jeweler Nirav Modi, his family members and business partner Mehul Choksi, owner of the Gitanjali Gems at PNB's Brady House Branch in Mumbai. Following the scam, employees of PNB including people at the general manager level were suspended from their post for their suspected involvement in the biggest scam in the Indian banking sector. Also, the government has revoked passports of Nirav Modi and Mehul Choksi.
SBI fraud case State Bank of India (SBI) is at the forefront of a bank scam involving jewellery network Kanishk Gold Pvt Ltd (KGPL). The KGPL has been accused of defrauding a consortium of 14 banks amounting Rs 824.15 crore bank fraud led by the SBI. The Enforcement Directorate
39
(ED) and CBI registered a case against Kanishk Gold.
.
ICICI Bank's Chanda Kochhar bank fraud case ICICI Bank led the 31-bank consortium that extended credit to the tune of Rs 5280 crore to Mehul Choksi's Gitanjali Group. The Serious Fraud Investigation Office (SFIO) of the Ministry of Corporate Affairs on Tuesday summoned the ICICI Bank CEO Chanda Kochhar and Axis Bank MD Shikha Sharma in relation to the probe in Mehul Choksi's Gitanjali Gems fraud. BSE has also sought clarification from both Axis Bank and ICICI Bank on the news report. ICICI Bank led the 31-bank consortium that extended credit to the tune of Rs 5,280 crore to Mehul Choksi's Gitanjali Group. ICICI Bank alone had given Rs 405 crore loan to Gitanjali Gems. The Central Bureau of Investigation (CBI) has filed a case of criminal conspiracy and fraud against the former chief executive of ICICI Bank Chanda Kochhar and her husband Deepak Kochhar
40
2.11 Relevant Issues to tackle Bank Frauds in India All the major operational areas in banking represent a good opportunity for fraudsters with growing incidence being reported under deposit, loan and inter-branch accounting transactions, including remittances.
Expect fraud: Nowhere in the world the fraud can be avoided hence can the banks be no exceptions. It is a human tendency of taking the risk to commit the frauds if he finds suitable opportunities. concentrated on the areas, which are fraud prone. Fraud is the game of two. The rule makers and rule breakers. Whoever is strong in the anticipation of the situations wins the game of frauds. Fraud is a phenomenon, which cannot be eliminated, but it needs to be managed
Develop a fraud policy: The policy should be written and distributed to all employees, Borrowers and depositors. This gives a moral tension to the potential Fraudster. Maintain a zero tolerance for violations. The Indian bank needs to roar against the action that is taken against the Fraudsters. The media publicity against the fraudsters at all the levels is necessary. The announcement by US president George W. Bush that the “Corporate crooks will not be spared” gave the deep impact to the Corporate America. In India also we need to consider it as a severe problem and need to fight against it.
Assess Risk: Look at the ways fraud can happen in the organization. It is very important to study the trend and the style of frauds in the bank. Some of the big nationalized banks maintain the databases of the fraud cases reported in their banks. But the databases are dumb. They yield nothing unless they are analyzed effectively. Establish regular fraud-detection procedures. It could be in the form of internal audit or it could also be in the form of inspections. These procedures alone discourage employees from committing fraud. In addition to this the Institute of Chartered Accountants of India has issued a “Accounting and Assurance standard on internal controls which is a real guideline to test internal 41
controls. Controls break down because people affect them, and because circumstances change.
Segregate duties in critical areas: It is the absolutely basic principle of auditing a single person should not have the control of the books of accounts and the physical asset. Because this is the scenario which tempts the employee to commit the fraud. Hence it becomes essential to see that no one employee should be able to initiate and complete a critical transaction without involving someone else.
Maintain the tone of Ethics at the top: The subordinates have the tendency to follow their superiors. When the signals are passed on to the middle management about the unethical behavior of the top management the fear of punishment gets reduced and the tendency following the superior dominates. Fear vanishes when the tendency of “If I have to die I’ll take along the superior and die” tendency rises.
Review and enforce password security: The incidences of hacking and the Phishing have troubled the Indian Private sector banks to a great extent. In addition to this most of the Indian banks are running behind the ATM and credit cards to compete with each other but have conveniently forgone the fact that ATM cards and the credit cards are the best tools available in the hands of the fraudsters. Inappropriate system access makes it possible to steal large amounts of money very quickly and, in many cases, without detection. Hence the review and the enforcement of the security policy is going to be a crucial.
Promote the Whistle blowing Culture: Many of the surveys on Frauds have shown that the frauds are unearthed by the “TIPS” from insider or may be from outsiders. Internal audits and internal controls come much later. The message about contacting the vigilance officers is flashed in most of the branch premises. However the ethics lines are very rarely seen.
42
Conduct pre-employment screening: Since the raw material of the Banks is cash the banker needs to be more alert than any other employer before they recruit. Only testing the aptitude of a person is not of any use. Know whom you are hiring. More than 20 percent of resumes contain false statements. Most employers will only confirm dates of employment. Sometimes post employment condition might create the greed in the minds of employee, hence at least the bankers should test check the characters of their subordinates by creating real life scenarios such as offering the bribes by calling on some dummy borrower.
Screen and monitor Borrowers: Bad borrowers cause the biggest losses to the banks. What are they? Whothey represent themselves to be? Look at their ownership, clients, references, and litigation history. In many cases the potential fraudsters have history of defaulting in some other bank or Financial Institution. Though this is not the foolproof solution to the disease of the frauds to some extent it helps to combat the frauds.
43
CHAPTER 3 LITERATURE REVIEW Jeffords et al., (1992) “examined 910 cases during the 9 year period from 1981-1989 to assess the specific risk factors cited. Approximately 63% of cases were classified under the internal control risks.” Similarly, Calderon and Green (1994) “made an analysis of 114 actual cases of corporate fraud from 1986 to 1990. The study found that professional and managerial employees were involved in 45% of the cases.” Ziegenfuss (1996) performed a study to determine the amount and type of fraud occurring in state and local government. Willson (2006) examined “the causes that led to the breakdown of „Barring‟ bank as case study. The collapse resulted due to the failures in management, financial and operational controls of Baring Banks.” However, Bhasin (2007) “examined the reasons for check frauds, the magnitude of frauds in Indian banks, and the manner in which the expertise of internal auditors can be integrated in order to detect and prevent frauds in banks.” One important challenge for banks is the examination of new technology applications for control and Security issues.
As per the survey conducted by Ganesh and Raghurama (2008), about 80 executive from Corporation Bank and Karnataka Bank of India. “Respondents were requested to rate their subordinates in terms of development of their skills before and after they underwent certain commonly delivered training programs.” Responses revealed that for the 17 skills identified, there was improvement in the skills statistically. Moreover, another study to investigate the reasons for bank frauds and implementation of preventive security controls in Indian banking industry was performed by Khanna and Arora (2009). The study “seeks to evaluate the various causes that are responsible for bank frauds. The result indicate that lack of training, overburdened staff, competition, low compliance level are the main reasons for bank frauds.” overburdened staff, competition, low compliance level are the main reasons for bank frauds.” Chiezy and Onu (2013) “evaluated the impact of fraud on the performance of 24 banks in Nigeria during 2001-2011, using Pearson correlation and multiple regression analysis. They recommended that “banks in Nigeria need to strengthen their internal control systems and the regulatory bodies should improve their supervisory role.”
44
CHAPTER 4 DATA ANALYSIS
As we can see 12.5% of people are having account in axis bank , 37.5% are having account in HDFC bank,12.5% in ICICI bank & 37.5% are having their accounts in other banks.
45
As we can see 62.5% peoples are saying that their banks are gone through from fraud whereas 37.5% are are saying their banks have not gone through any kind of fraud.
46
Audit is very important in every bank .As we can see 25% peoples are saying that are bank are audited 1 time, 50% of peoples are saying that their banks are audited 2 times 12.5%peoples are saying theirs banks are audited 3 times & 12.5% are saying others.
47
As we can see 12.5% of peoples are saying that their banks had gone through credit card fraud , 50% peoples are saying their banks had gone through cash fraud, 25% of peoples are saying their banks had gone through fraudulent fraud & 12.5% are saying others.
48
As we can see 50% peoples are saying yes whereas on other side 50 % peoples are saying no.
49
As we can see 62.5% peoples are saying yes & 37.5% are saying no.
50
As we can see 50% peoples are saying yes, 25% peoples are saying no & 25% people have no idea.
51
As we can say 12.5 % peoples are saying it is major problem, 50% peoples are saying it is minor problem, and 37.5% peoples are saying that there is no problem.
52
As we can say 37.5% peoples are saying yes & 62.5% are saying no.
53
As we can see 37.5% peoples are saying quarterly , 12.5% peoples are saying half yearly, 37.5% are saying annually ,& 12.5% are saying others.
54
As we can see 20% of peoples are saying it is increasing rapidly , 60% peoples are saying it is increasing & 20% peoples are saying it is constant.
55
CHAPTER 5-CONCLUSION The frauds may be primarily due to lack of adequate supervision of top management, faulty incentive mechanism in place for employees; collusion between the staff, corporate borrowers and third party agencies; weak regulatory system; lack of appropriate tools and technologies in place to detect early warning signals of a fraud; lack of awareness of bank employees and customers; and lack of coordination among different banks across India and abroad. The delays in legal procedures for reporting, and various loopholes in system have been considered some of the major reasons of frauds and NPAs. Also, despite efforts, banks have not been very successful in conviction of individuals responsible for financial crimes. One of the root causes of this problem is identified as lack of specialized financial sleuths with knowledge of nuances of forensic accounting as well as a good legal understanding of frauds.
56
Suggestion a.. There should be a dedicated cell within each bank to monitor the company/firm to which they are lending and the macro-economic environment of the concerned industry or market where products are marketed. This is independent of the credit officers. The job should be to constantly evaluate and not just check the same during the time of on-boarding. b. Re-KYC, if done diligently can also help check any fraudulent activities particularly on the liability side. Infact, staff may be incentivized to do the same. c. Triggers should be designed for all transactions. These should be for both liability as well as borrowal customers. The triggers should alert concerned officials upon deviation. Typically, banks have such alert mechanism for loan customers but liability is not a no-risk area. d. The government should consider examining the role of third parties such as chartered accountants, advocates, auditors, and rating agencies that figure in accounts related to bank frauds, and put in place strict punitive measures for future deterrence. There is also a case to be made to question the certification/credentials of third parties like auditors to decide their competence in evaluating accounts containing potentially fraudulent entries. e. A new case of fraud should be informed to all officials of the bank. Nowadays with each bank having their own intranet system for communication, a simple mailer with the names of the officers / parties morphed may be circulated. f. Feeding of information by various govt. agencies to banks should be made. Agencies / authorities like Home Ministry, CBI, CBDT, CBEC, CVC, RBI atleast should regularly feed banks with information if at all they get on an apriori basis. g. Banks have traditionally focused their investments on becoming secure. However, this approach is no longer adequate in the face of a rapidly changing threat landscape. Banks should consider building cyber risk management programs to achieve three essential capabilities namely: the ability to be secure, vigilant, and resilient.
57
Suggested Model After studying the present problems and capabilities a fraud management solution can be suggested using sophisticated information technology.
FRAMEWORK OF FRAUD & RISK MANAGEMENT STRUCTURE & GUIDELINE
TRAINING
FRAUD MANAGEMENT SOLUTION
DATA ANALYTICS PROFILING & ALERTS
58
AUDIT & INVESTIGATION
RECOMMENDATION To ensure smooth operation of the banking industry bank should ensure efficient system of internal controls and that adequate internal control measures are put in place to safeguard the assets the banks against theft. Misuse of improper disbursements , ensure that all accounts are reliable and accurate. A good internal organisation should be put in place by banks. This will ensure that proper delegation exists, duties and job, are clearly divided and that job do not overlap. Similarly, staff members should not have unlimited access to sensitive machined and instruments like cheques, and official stamp. Data security should be ensuring at all Times. The banks however, should make it a point to take good care of their staff through fringe benefits and Incentives job at the bank should be constantly rotated, so that no staffs stays in one position for too long. Banks Management must also know their staff thoroughly well including their background and anteced must be kept on all customers. Activities In the cash area in banks must be monitored on a massive scale through the illustration of a cloe circuit television the bank manager should ensure that qualitative technique of control is practiced. Techniques such as constant inspections, security control, enhance remuneration, reassignment of staff, penalties, and fraud detecting equipments. Banks education seminar, electronic monitoring equipments and use of adequate supervision of document accounts.
Following recommendations are suggested for an early detection of frauds. 1. Independent specialized cadre. 2. Know your markets . 3. Internal rating agencies 4. Use of latest technology 5. Strong laws to prevent fraudulent financial reporting
59
BIBILOGRAPHY https://www.iimb.ac.in/sites/default/files/2018-07/WP_No._505. https://www.ijbmi.org/papers/Vol(5)7/version-2/A05720109.pdf https://www.researchgate.net/publication/286134307_AN_EMPIRICAL_STUDY_OF_FRAUD S_IN_THE_BANKS https://www.google.com/ https://www.ibtimes.co.in/7-bank-frauds-that-have-rocked-indian-banking-sector-2018-765432 https://en.wikipedia.org/wiki/Bank_fraud http://www.legalserviceindia.com/article/l261-Bank-Frauds.html https://www.ijbmi.org/papers/Vol(5)7/version-2/A05720109.
60