Lok Sabha Question No. 311 (STARRED), answered on 2019-07-15
Subject: Fake Currency
Ministry: FINANCE
Asked by: Khagen Murmu, Vinod Kumar Sonkar

## FINANCEMIMSTER

(sMT. MRMALA STTITARAMAN)

- (a) to (e)  :  A statement is laid on the table of the House.

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## GOVERNMENT OF INDIA MINISTRY OF FINANCE

## LOK SABHA

## STARRED  QUESTION  NO. 311 ANSWERED ON -1 5.07.20 1 9

## FAKE CURRENCY

## *3  1 I. SHRI KHAGEN  MURMU :

SHRI VINOD KLI]\4AR SONKAR:

Will the Minister of FINANCE  be pleased to state :-

- a) whether there is a rise in circulation of fake currency  in the country and Malda region of West Bengal  is one of the major sources of its circulation;
- b) if so, the details  thereof during the last four years along with the loss suffered by the country's economy  due to such counterfcit  curency;
- c) whether the banks have any policy to replace the fake notes or mutilated or scribbled new currencies  in order to avoid any financial losses to general  public and if so, the details thereof;
- d) whether the Govemment has made any efforts to identifu the sources of entry of counterfeit curency  in the country and if so, the details thereof; and
- e)  the corrective steps being taken by the Govemment  /the Reserve  Bank of India to preventcirculation  offake currency  notes  in the country?

## A}{SWER

## STATEMENT REFERRED TO IN REPLY TO LOK SABIIA STAITRED  QUESTION  NO.3II RAISED BY SIIRI KHAGEN MUIIMU AND SIIRI VINOD KUMAR SONKAR, HON'BLE MEMBER OF PARLIAMENT  TO BE ANSWERED ON 15.7.2019 ITEGARDING  FAKN CURRENCY

(a) Sir, the data as reported  by RBI and seizure of FICN by StatefuT Police  (SCRBs)  & other Agencies as reported  by National  Crime Records Bureau reveal that there is a declining trend  in the circulation of Fake Indian Counterfeit Notes (FICN) in the country.

It was  reported by West Bengal Police that flow of FICNs  continues from Indo-Bangladesh  border, particularly  fiom Malda area. However,  all such FICNs were of low quality i.e. computer generated/manipulated.

(b) After the withdrawal  of legal  tender  status  of Specified Bank Notes ofdenomination  ofRs.l000 and Rs.500  on SmNovember, 2016, there have been no reported  cases of scizure of High  Quality  Fake Indian Currency  Notes of Rs.2000  and Rs.500  denomination till early 2019.  As such,  there does not appear to be any appreciable loss now.

(c) As per Reserve  Bank of India's master circular  dated July 1,2019, no credit to customer's  account is to be given for counterfeil  Noles, ifany,  detected in t}-te tender received over the counter  or at the backoffice/currency  chest.

Reserve  Bank of India has advised all the bank to accept mutilated/defective/solid  notes  at all their branches  vide master  circular on "Facility for exchange ofNotes  & Coins" dated July 1,2019. However, small  finance  bank and payment  banks may exchange mutilated  and defective notes at their option.  The mutilated notes are exchar.rged  at all bank  branches in terms of Reserve  Bank of lndia (Note Refund) Ruies,2009,  as amended  in 2018.

(d) & (e) Govemment  has taken various steps to check the smuggling and circulation of Fake Indian Currency  Notes in the country, which inter-alia,  include:

(i) Fake Indian  Currency Notes (FICN) Coordination  Group (FCORD) has been formed by the Ministry of Home Affairs (MHA) to share inlelligences/information  among the security agencies  of the States/Centre to counter  the problem  of circulation of fake currency  in the country.  As per the report  of the agencies,  there have been instances  where it has been found that the fake currency  has been smuggled from the neighboring  counlries.

(ii)  A Terror Funding and Fake Currency Cell (TFFC) has been constiluted in National Investigation Agency  Q.{IA)  to investigate  tcrror funding  and fake currency cases.

(iii)  A memorandum  of Urrderstanding  (MoU) has been signed between  India and Bangladesh to prevenl and counter  smuggling and circulation offake currency notes.

(iv) Security at the international border has been strengthened  by using new surveillances technology, deploying additional  manporver  for round the clock surveillance, cstablishing observation  posts along the intemational  border erectior.r  ofborder fencing and intensive patrolling.