Banking Frauds – Prevention is the only Remedy

Banking Frauds – Prevention is the only Remedy
Bank frauds swallow all the economic development and cause financial indiscipline in the country. Big defaulters like Vijay Mallya, Nirav Modi, Mehul Choksi usurp thousands of crores which not only add to sharp increase in the quantum of Non-Performing Assets (NPAs) but siphon off sizable funds that could have otherwise been used for economic well being of thousands of poors willing to become entrepreneurs with banks’ help and plan to start up their small businesses.


Prevention of Bank Frauds if the only Cure

  • Most of the big corporates who have committed fraud to the tune of thousands of crores are shying away from coming back and to repay the money as they are aware that the punishment by law will still be there even if they repay. Indian Law or the Indian Government has no way to award softer punishment even if these defaulters repay the amount in full. Accordingly, it is more important to prevent a bank fraud than to run after it when it is done.
  • With the existing rules and laid down procedures most of banking frauds can be prevented, in case they are meticulously followed and bank staff is not pressurised to sanction the loan.
  • RBI is tasked with detecting infirmities, but has no authority to enforce its own orders, administer remedial measures or even deliver swift punitive action. The central investigative agencies are tasked with following up on investigations and pursuing legal recourse. The political pulls and pressures on these agencies, as well as the Indian legal system’s long-drawn processes, provides swindlers with enough escape routes and is never a deterrent. It should be looked into.
  • As a cautious bank customer, you should register your working mobile number with your bank so as to receive SMS/Email alerts regarding transactions.
  • Check the emails and messages received from the bank, regularly. In case you find any suspicious or unapproved transaction that you can’t place, consult and report to the bank, immediately.


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