Take the pledge to vote

For a better tommorow#AajSawaroApnaKal
  • I agree to receive emails from News18

  • I promise to vote in this year's elections no matter what the odds are.
  • Please check above checkbox.

    SUBMIT

Thank you for
taking the pledge

Vote responsibly as each vote counts
and makes a diffrence

Disclaimer:

Issued in public interest by HDFC Life. HDFC Life Insurance Company Limited (Formerly HDFC Standard Life Insurance Company Limited) (“HDFC Life”). CIN: L65110MH2000PLC128245, IRDAI Reg. No. 101 . The name/letters "HDFC" in the name/logo of the company belongs to Housing Development Finance Corporation Limited ("HDFC Limited") and is used by HDFC Life under an agreement entered into with HDFC Limited. ARN EU/04/19/13618
LIVE TV DownloadNews18 App
News18 English
News18 » Business
3-min read

CVC Shares Report Detailing Modus Operandi, Type of Lending in Top 100 Bank Frauds With Govt

The report, which has also been shared with the Ministry of Corporate Affairs, carries analysis of large value frauds reported since March 31, 2017.

PTI

Updated:October 16, 2018, 6:24 PM IST
facebookTwitterskypewhatsapp
CVC Shares Report Detailing Modus Operandi, Type of Lending in Top 100 Bank Frauds With Govt
File photo of diamantaire Nirav Modi.
Loading...

New Delhi: Probity watchdog Central Vigilance Commission (CVC) has completed a first-of-its-kind analysis of the top 100 banking frauds, including those in the jewellery and aviation sectors, and shared its findings with the RBI, ED and CBI among others, Vigilance Commissioner T M Bhasin said Tuesday.

The analysis focussed on the modus operandi, amount involved, type of lending (viz. consortium or individual), anomalies observed, loopholes that facilitated perpetration of the fraud concerned and the systemic improvements required to plug the gaps in the system and procedures.

The frauds were classified and analysed for 13 sectors including gem and jewellery, manufacturing and industry, agro, media, aviation, service and project, discounting of cheques, trading, information technology, export business, fixed deposits, demand loan and letter of comfort.

The modus operandi of these top 100 loans has been thoroughly analysed and various loopholes or lapses have been identified, Bhasin said.

"Based on the findings, various industry specific suggestions for systemic improvement have been given in the final report, which have also been sent to the Department of Financial Services and RBI (Reserve Bank of India), in order to plug the loopholes observed by the Commission," he told PTI.

Bhasin said the finding have also been shared the Enforcement Directorate (ED) and the Central Bureau of Investigation (CBI).

The measures suggested include strengthening of standard operating procedures (SOPs) and the monitoring system, and also highlighting the role of controlling offices, so as to examine the aspect of quality of business, Bhasin said.

The move assumes significance in the wake of high profile bank fraud cases involving absconding billionaire Nirav Modi and liquor baron Vijay Mallya among others.

The report, which has also been shared with the Ministry of Corporate Affairs, carries analysis of large value frauds reported since March 31, 2017.

Bhasin said this analytical study was initiated by the commission as a preventive vigilance measure to minimise the occurrence of such type frauds in the future.

"The RBI has also confirmed to the commission that inputs given by the CVC are very useful and shall be used for systemic improvements to mitigate the risks," he said, sharing the reason behind initiating the analysis of the frauds.

Bhasin, a former chairman and managing director of the Indian Bank, said the intention of the commission is to bring about awareness among the field functionaries by enhancing their knowledge towards the existing lapses, so that 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," he said.

Bhasin said as a conscious decision and with a view to maintaining discreteness, the names of borrower accounts or 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.

Giving details of the frauds in the gem and jewellery sector, the report cited different modus operandi by private companies, including inflating the valuation of diamonds with the malafide intention to avail higher credit facilities from the lenders.

It cited absence of effective mechanism in banks and certain other loopholes that led to frauds in this sector and suggested systemic changes.

"The gem and jewellery sector credit facilities to these companies increased manifold within a short span of time in an effort by the banks to increase their credit dispensation. There should have been some segment related limits on such type of credit exposures," the report suggested.

There are different modus operandi, loopholes and systemic improvements suggested by the CVC in the report.

Get the best of News18 delivered to your inbox - subscribe to News18 Daybreak. Follow News18.com on Twitter, Instagram, Facebook, TikTok and on YouTube, and stay in the know with what's happening in the world around you – in real time.

Subscribe to Moneycontrol Pro and gain access to curated markets data, trading recommendations, equity analysis, investment ideas, insights from market gurus and much more. Get Moneycontrol PRO for 1 year at price of 3 months. Use code FREEDOM.

Read full article
Loading...
Next Story
Next Story

Also Watch

facebookTwitterskypewhatsapp
Most Active
Company Price Change %Gain
Yes Bank 56.30 -13.91
LIC Housing Fin 414.00 -10.66
Indiabulls Hsg 450.55 -6.82
DLF 144.45 -15.82
Maruti Suzuki 6,208.55 -0.33
Company Price Change %Gain
LIC Housing Fin 412.85 -10.97
Yes Bank 56.30 -13.91
DLF 144.30 -15.91
Indiabulls Hsg 449.90 -6.82
Tata Steel 333.35 -2.83
Top Gainers
Company Price Change %Gain
Britannia 2,440.75 2.36
Dr Reddys Labs 2,545.40 1.69
Tech Mahindra 682.75 1.48
TCS 2,216.00 1.36
HUL 1,872.10 1.19
Company Price Change %Gain
TCS 2,214.90 1.33
HUL 1,872.25 1.21
HCL Tech 1,078.45 0.63
Top Losers
Company Price Change %Gain
Yes Bank 56.30 -13.91
Vedanta 129.05 -7.79
Indiabulls Hsg 450.55 -6.82
Bajaj Finserv 6,767.35 -5.30
Bajaj Finance 3,114.10 -4.52
Company Price Change %Gain
Yes Bank 56.30 -13.91
Vedanta 129.05 -7.76
Bajaj Finance 3,117.80 -4.39
Coal India 180.70 -4.26
Tata Motors 107.65 -4.14

Live TV

Loading...
Countdown To Elections Results
To Assembly Elections 2018 Results