Lok Sabha Question No. 1724 (UNSTARRED), answered on 2023-07-31
Subject: Fraud in Banks
Ministry: FINANCE
Asked by: Sanjay Haribhau Jadhav, Vinayak Bhaurao Raut

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF FINANCIAL SERVICES

## LOK SABHA

## UNSTARRED QUESTION NO†17 24 ANSWERED ON 31 st  JULY, 2023 / SRAVANA 9, 1945 (SAKA)

## FRAUD IN BANKS

## †17 24. SHRI SANJAY JADHAV SHRI VINAYAK RAUT

Will the Minister of FINANCE be pleased to state:-

- (a) the number of bank fraud cases reported during each of the last ten years and the current year, bank-wise;
- (b) whether these cases have been reported in private banks also and if so, the details thereof;
- (c) the directions issued to the banks by the Government to check such frauds and whether the Government has asked them to strengthen their fraud risk management mechanism;
- (d) whether, in spite of this, the incidents of frauds are increasing and if so, the details thereof;
- (e) the  steps  taken  by  the  Public  Sector  Banks  to  plug  the  security  loopholes  and  to  ensure proper investigation of digital banking frauds; and
- (f) the number of persons who left the country after cheating the banks in the last ten years and the manner in which the amount has been recovered from them?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE

## (DR. BHAGWAT KARAD)

- (a) to (f): Bank-wise and year-wise details of number of frauds in SCBs, in respect of amount involved of Rs. 1 lakh and above in each fraud, based on the date of occurrence, for the last ten financial years are at Annex.

RBI has issued Master Directions on frauds -classification and reporting by commercial banks and select financial institutions, to provide a framework to banks enabling them to detect and report  frauds  early  and  taking  timely  consequent  actions  like  reporting  to  the  Investigative agencies  so  that  fraudsters  are  brought  to  book  early,  examining  staff  accountability  and  do effective/strengthen  fraud  risk  management.  Also,  wide-ranging  structural  and  procedural reforms have been instituted to check frauds in banks.

The improved detection  and  reporting  accompanied  with  the  comprehensive  steps  taken  to check frauds have resulted in sharp decline in the occurrence of such frauds, from Rs. 77,544 crore in the financial year (FY) 2013-14 to Rs. 1,650 crore in FY2022-23.

Further, comprehensive steps including, inter alia, steps to address security flaws/loopholes and to  strengthen  the  fraud  risk  management  mechanism  in  banks,  have  been  taken  by  the Government, RBI and public sector banks (PSBs) including, inter -alia , the following -

- (i) An online searchable database of frauds reported by banks, in the form of Central Fraud Registry, has been set up to enable timely identification, control and mitigation of fraud risk and also to carry out due diligence during the credit sanction process.
- (ii) Issuance  by  the  Government  in  2015  of  'Framework  for  timely  detection,  reporting, investigation etc. relating to large value bank frauds' to PSBs for dealing with suspected frauds involving sum of money in excess of Rs. 50 crore.
- (iii) A National Cyber Crime Reporting Portal has been launched by the Ministry of  Home Affairs to enable public to report incidents pertaining to all types of cybercrimes, and a toll-free  number  has  also  been  operationalised  to  get  assistance  in  lodging  online complaints.
- (iv) The Fugitive Economic Offenders Act, 2018 has been enacted to provide for attachment of property of a fugitive economic offender, confiscation of such offender's property and disentitlement of the offender from defending any civil claim.
- (v) Heads  of  PSBs  have  been  empowered  to  issue  requests  for  issuance  of  Look-Out Circulars.
- (vi) Advisory has been issued by Government to PSBs to decide on publishing photographs of wilful defaulters, in terms of RBI's instructions and as per their Board -approved policies.

Directorate of Enforcement (ED), the agency mandated for investigation and prosecution of cases under the Prevention of Money Laundering Act, 2002 (PMLA), has apprised that it has recorded  757  cases  involving  bank  fraud  in  public  and  private  sector  banks  under  the provisions of PMLA in the last ten years and 36 cases in the current year. It has been noticed that in 10 cases, 14 persons have fled the country and of these, 06 persons have been declared as Fugitive Economic Offenders and 07 persons have been declared as Proclaimed Offenders. In  cases  where  persons  have  fled  the  country,  as  on  25.7.2023,  assets  amounting  to  Rs. 15,805.91 crore have been confiscated & assets amounting to Rs. 15,113.02 crore have been restituted to the PSBs.

Further,  in  respect  of  loan  frauds,  recovery  action  is  initiated  through  various  recovery mechanisms available with banks, such as filing of a suit in civil courts or in Debts Recovery Tribunals, action under  the  Securitisation  and  Reconstruction  of  Financial  Assets  and Enforcement  of  Security  Interest  Act,  2002,  filing  of  cases  in  the  National  Company  Law Tribunal under the Insolvency and Bankruptcy Code, 2016, through negotiated settlement/compromise etc.

*****

## Lok Sabha Unstarred question no. † 1724, regarding Fraud in Banks

## Bank-wise and year-wise number of frauds in SCBs, in respect of amount involved of Rs. 1 lakh and above in each fraud, based on the date of occurrence, for last ten years

| Bank                                            | FY13-14   | FY14-15   | FY15-16   | FY16-17   | FY17-18   | FY18-19   | FY19-20   | FY20-21                 | FY21-22                 | FY22-23                 |
|-------------------------------------------------|-----------|-----------|-----------|-----------|-----------|-----------|-----------|-------------------------|-------------------------|-------------------------|
| Abu Dhabi Commercial Bank Pjsc                  | 1         | 1         | 1         | --        | --        | --        | --        | --                      | --                      | --                      |
| Aditya Birla Idea Payments Bank Limited         | --        | --        | --        | --        | --        | 24        | --        | --                      | --                      |                         |
| Airtel Payments Bank Limited                    | --        | --        | --        | --        | --        | --        | --        | 58                      | --                      | 34                      |
| Allahabad Bank                                  | 77        | 78        | 91        | 147       | 143       | 56        | 10        | Merged with Indian Bank | Merged with Indian Bank | Merged with Indian Bank |
| American Express Banking Corp.                  | 199       | 197       | 180       | 171       | 338       | 226       | 169       | 91                      | 66                      | 164                     |
| Andhra Bank                                     | 54        | 53        | 74        | 62        | 55        | 35        | 4         | Merged with Union Bank  | Merged with Union Bank  | Merged with Union Bank  |
| Au Small Finance Bank Limited                   | --        | --        | 1         | 2         | 4         | 9         | 13        | 14                      | 13                      | 35                      |
| Australia and New Zealand Banking Group Limited | --        | --        | --        | --        | --        | --        | 1         | --                      | --                      | --                      |
| Axis Bank Limited                               | 184       | 199       | 270       | 279       | 379       | 378       | 363       | 543                     | 752                     | 964                     |
| Bandhan Bank Limited                            | 5         | 4         | 29        | 59        | 61        | 60        | 36        | 33                      | 65                      | 61                      |
| Bank of America National Assn                   | 1         | --        | 2         | 1         | 16        | 10        | 4         | 2                       | 2                       | 2                       |
| Bank of Bahrain And Kuwait B.S.C.               | --        | --        | --        | 2         | --        | --        | --        | --                      | 1                       | --                      |
| Bank of Baroda                                  | 282       | 325       | 220       | 222       | 215       | 138       | 134       | 97                      | 91                      | 107                     |
| Bank of India                                   | 175       | 216       | 156       | 129       | 148       | 154       | 108       | 64                      | 103                     | 69                      |
| Bank of Maharashtra                             | 83        | 82        | 51        | 64        | 67        | 88        | 36        | 26                      | 29                      | 17                      |
| Bank of Nova Scotia                             | --        | --        | --        | 1         | 1         | --        | --        | --                      | --                      | --                      |
| Barclays Bank Plc                               | 1         | --        | --        | --        | --        | --        | 1         | --                      | --                      | --                      |
| Bharatiya Mahila Bank Limited                   | --        | 1         | 3         | --        | --        | --        | --        | --                      | --                      | --                      |
| BNP Paribas                                     | --        | --        | --        | --        | --        | --        | 3         | 1                       | --                      | --                      |
| Canara Bank                                     | 181       | 182       | 135       | 89        | 118       | 101       | 70        | 45                      | 47                      | 13                      |
| Capital Small Finance Bank Limited              | 2         | --        | --        | --        | --        | --        | --        | 1                       | 2                       | 3                       |
| Catholic Syrian Bank Limited                    | 16        | 21        | 33        | 9         | 30        | 24        | 33        | 70                      | 57                      | 116                     |

| Bank                                        | FY13-14   | FY14-15   | FY15-16   | FY16-17   | FY17-18   | FY18-19   | FY19-20                    | FY20-21                    | FY21-22                    | FY22-23                    |
|---------------------------------------------|-----------|-----------|-----------|-----------|-----------|-----------|----------------------------|----------------------------|----------------------------|----------------------------|
| Central Bank of India                       | 206       | 182       | 122       | 105       | 110       | 107       | 117                        | 91                         | 139                        | 18                         |
| CitibankN                                   | 88        | 105       | 129       | 190       | 210       | 275       | 247                        | 117                        | 151                        | 158                        |
| City Union Bank Limited                     | 4         | 2         | 3         | 5         | 13        | 9         | 11                         | 16                         | 8                          | 28                         |
| Coastal Local Area Bank Limited             | --        | 1         | --        | --        | --        | 1         | --                         | 1                          | --                         | --                         |
| Co-operative Rabobank U.A.                  | --        | --        | --        | --        | 2         | --        | --                         | --                         | --                         | --                         |
| Corporation Bank                            | 113       | 78        | 61        | 55        | 20        | 12        | 4                          | Merged with Union Bank     | Merged with Union Bank     | Merged with Union Bank     |
| Credit Suisse Ag                            | --        | --        | --        | --        | --        | --        | --                         | 1                          | --                         | --                         |
| CTBC Bank Co. Limited                       | 3         | --        | --        | --        | --        | --        | --                         | --                         | --                         | --                         |
| DBS Bank India Limited                      | 2         | 2         | 1         | 5         | 1         | 10        | 8                          | 9                          | 8                          | 8                          |
| DCB Bank Limited                            | 7         | 8         | 7         | 2         | 11        | 11        | 14                         | 9                          | 5                          | 5                          |
| Dena Bank                                   | 45        | 30        | 36        | 24        | 11        | 3         | Merged with Bank of Baroda | Merged with Bank of Baroda | Merged with Bank of Baroda | Merged with Bank of Baroda |
| Deutsche Bank Ag                            | 1         | 3         | 1         | 1         | 8         | 3         | 9                          | 3                          | 8                          | 13                         |
| Doha Bank Qsc                               | 1         | --        | --        | 1         | --        | --        | --                         | --                         | 1                          | --                         |
| Equitas Small Finance Bank Limited          | 1         | --        | 2         | 7         | 19        | 30        | 23                         | 32                         | 19                         | 40                         |
| ESAF Small Finance Bank Limited             | --        | --        | --        | --        | 5         | 7         | 8                          | 9                          | 9                          | 17                         |
| Federal Bank Limited                        | 48        | 37        | 36        | 25        | 49        | 50        | 42                         | 75                         | 61                         | 113                        |
| Fincare Small Finance Bank Limited          | --        | --        | --        | --        | 2         | 19        | 4                          | 10                         | 19                         | 42                         |
| FINO Payments Bank Limited                  | --        | --        | --        | --        | 3         | 19        | 30                         | 23                         | 26                         | 26                         |
| FirstRand Bank Limited                      | --        | 1         | --        | 1         | 1         | --        | --                         | --                         | --                         | --                         |
| HDFC Bank Limited                           | 230       | 293       | 396       | 377       | 419       | 466       | 471                        | 366                        | 436                        | 1100                       |
| Hongkong And Shanghai Banking Corpn limited | 68        | 42        | 33        | 45        | 302       | 222       | 242                        | 141                        | 86                         | 116                        |
| HSBC Bank Oman S.A.O.G.                     | 1         | --        | --        | --        | --        | --        | --                         | --                         | --                         | --                         |
| ICICI Bank Limited                          | 499       | 504       | 572       | 563       | 565       | 500       | 685                        | 576                        | 1263                       | 986                        |
| IDBI Bank Limited                           | 102       | 162       | 252       | 157       | 171       | 188       | 162                        | 133                        | 120                        | 82                         |
| IDFC First Bank Limited                     | --        | --        | 3         | 14        | 35        | 71        | 96                         | 71                         | 35                         | 40                         |
| India Post Payments Bank Limited            | --        | --        | --        | --        | --        | 1         | 8                          | 3                          | 4                          | 1                          |
| Indian Bank                                 | 76        | 88        | 69        | 104       | 83        | 87        | 81                         | 63                         | 65                         | 31                         |
| Indian Overseas Bank                        | 147       | 152       | 118       | 93        | 92        | 97        | 69                         | 43                         | 32                         | 47                         |

| Bank                                  | FY13-14   | FY14-15   | FY15-16   | FY16-17   | FY17-18   | FY18-19   | FY19-20                            | FY20-21                            | FY21-22                            | FY22-23                            |
|---------------------------------------|-----------|-----------|-----------|-----------|-----------|-----------|------------------------------------|------------------------------------|------------------------------------|------------------------------------|
| IndusInd Bank Limited                 | 26        | 24        | 22        | 18        | 46        | 82        | 123                                | 397                                | 1368                               | 1396                               |
| Ing Vysya Bank Limited                | 19        | 15        | --        | --        | --        | --        | --                                 | --                                 | --                                 | --                                 |
| Jammu & Kashmir Bank Limited          | 10        | 13        | 12        | 14        | 13        | 14        | 6                                  | 4                                  | 7                                  | 6                                  |
| Jana Small Finance Bank Limited       | --        | 3         | 2         | 13        | 16        | 32        | 57                                 | 29                                 | 33                                 | 11                                 |
| JP Morgan Chase Bank National         | --        | --        | --        | --        | --        | --        | --                                 | 1                                  | --                                 | --                                 |
| Karnataka Bank Limited                | 37        | 16        | 21        | 7         | 21        | 20        | 53                                 | 10                                 | 15                                 | 6                                  |
| Karur Vysya Bank Limited              | 26        | 26        | 16        | 23        | 35        | 26        | 24                                 | 6                                  | 25                                 | 22                                 |
| KEB Hana Bank                         | --        | --        | --        | 2         | 1         | --        | --                                 | --                                 | --                                 | --                                 |
| Kotak Mahindra Bank Limited           | 77        | 57        | 106       | 136       | 290       | 386       | 654                                | 828                                | 911                                | 642                                |
| Krishna Bhima Samruddhi Lab Limited   | 1         | 1         | --        | 3         | --        | --        | --                                 | 1                                  | --                                 | --                                 |
| Lakshmi Vilas Bank Limited            | 9         | 9         | 30        | 53        | 43        | 49        | 31                                 | 5                                  | Merged with DBS                    | bank                               |
| Mashreq Bank PSC                      | 1         | --        | --        | --        | --        | --        | --                                 | --                                 | --                                 | --                                 |
| MUFG Bank Limited                     | --        | --        | --        | --        | --        | --        | --                                 | --                                 | 1                                  | --                                 |
| Nainital Bank Limited                 | 5         | 26        | 1         | 10        | 5         |           | 5                                  | 4                                  | 3                                  | 1                                  |
| North East Small Finance Bank Limited | --        | --        | --        | --        | --        | 2         | 3                                  | 6                                  | 3                                  | 2                                  |
| NSDL Payments Bank Limited            | --        | --        | --        | --        | --        | --        | --                                 | 1                                  | 1                                  | --                                 |
| Oriental Bank of Commerce             | 100       | 139       | 123       | 51        | 29        | 14        | 8 Merged with Punjab National Bank | 8 Merged with Punjab National Bank | 8 Merged with Punjab National Bank | 8 Merged with Punjab National Bank |
| Paytm Payments Bank Limited           | --        | --        | --        | --        | --        | 2         | 1                                  | --                                 | --                                 | 1                                  |
| Pt Bank Maybank Indonesia Tbk         | --        | --        | --        | 1         | --        | --        | --                                 | --                                 | --                                 | --                                 |
| Punjab And Sind Bank                  | 31        | 38        | 40        | 71        | 29        | 23        | 45                                 | 56                                 | 21                                 | 18                                 |
| Punjab National Bank                  | 211       | 202       | 224       | 195       | 213       | 150       | 130                                | 100                                | 107                                | 54                                 |
| RBL Bank Limited                      | 14        | 16        | 25        | 23        | 28        | 39        | 64                                 | 55                                 | 132                                | 480                                |
| SBM Bank (India) Limited              | 3         | --        | --        | --        | 2         | 1         | 1                                  | 1                                  | 2                                  | 6                                  |
| Shinhan Bank                          | --        | 1         | 1         | --        | --        | --        | --                                 | 2                                  | --                                 | 1                                  |
| Shivalik Small Finance Bank Limited   | --        | --        | --        | --        | --        | 1         | 1                                  | --                                 | --                                 | --                                 |
| Société Générale                      | 1         | --        | --        | --        | --        | --        | --                                 | --                                 | --                                 | --                                 |
| Sonali Bank                           | --        | --        | --        | --        | --        | --        | 1                                  | --                                 | --                                 | --                                 |
| South Indian Bank Limited             | 10        | 4         | 13        | 14        | 31        | 60        | 34                                 | 34                                 | 47                                 | 40                                 |

| Bank                                     | FY13-14   | FY14-15   | FY15-16   | FY16-17   | FY17-18   | FY18-19     | FY19-20                    | FY20-21                          | FY21-22                          | FY22-23                          |
|------------------------------------------|-----------|-----------|-----------|-----------|-----------|-------------|----------------------------|----------------------------------|----------------------------------|----------------------------------|
| Standard Chartered Bank                  | 64        | 94        | 142       | 320       | 99        | 93          | 231                        | 142                              | 106                              | 168                              |
| State Bank of Bikaner And Jaipur         | 41        | 18        | 8         | 5         |           |             |                            |                                  |                                  |                                  |
| State Bank of Hyderabad                  | 24        | 25        | 18        | 6         |           | Merged with | State                      | Bank of India                    |                                  |                                  |
| State Bank of India                      | 820       | 874       | 1,000     | 973       | 1,121     | 1,143       | 877                        | 499                              | 488                              | 210                              |
| State Bank of Mysore                     | 20        | 26        | 75        | 12        |           |             |                            |                                  |                                  |                                  |
| State Bank of Patiala                    | 47        | 17        | 15        | 6         |           |             |                            |                                  |                                  |                                  |
| State Bank of Travancore                 | 28        | 16        | 22        | 15        |           | Merged with | State                      | Bank of India                    |                                  |                                  |
| Subhadra Local Area Bank Limited         | --        | --        | --        | 1         |           |             |                            |                                  |                                  |                                  |
| Sumitomo Mitsui Banking Corporation      | --        | --        | --        | --        | --        | --          | --                         | 1                                | --                               | --                               |
| Suryoday Small Finance Bank Limited      | --        | --        | --        | 5         | 7         | 1           | 12                         | 13                               | 5                                | 9                                |
| Syndicate Bank                           | 169       | 234       | 312       | 179       | 169       | 78          | 37                         | Merged with Canara Bank          | Merged with Canara Bank          | Merged with Canara Bank          |
| Tamilnad Mercantile Bank Limited         | 23        | 22        | 20        | 25        | 39        | 45          | 45                         | 50                               | 48                               | 38                               |
| The Bank of Tokyo-Mitsubishi Ufj Limited | --        | --        | --        | 1         | 1         | 1           | --                         | --                               | --                               | --                               |
| The Dhanalakshmi Bank Limited            | 22        | 11        | 9         | 12        | 8         | 19          | 5                          | 1                                | 3                                | 3                                |
| The Royal Bank of Scotland Plc           | 7         | 2         | 8         | --        | --        | --          | --                         | --                               | --                               | --                               |
| UCO Bank                                 | 89        | 85        | 54        | 46        | 64        | 87          | 147                        | 199                              | 81                               | 27                               |
| Ujjivan Small Finance Bank Limited       | --        | --        | 5         | 15        | 12        | 14          | 40                         | 30                               | 25                               | 21                               |
| Union Bank of India                      | 163       | 178       | 176       | 195       | 177       | 121         | 135                        | 114                              | 100                              | 55                               |
| United Bank of India                     | 83        | 23        | 39        | 31        | 22        | 65          | 25                         | Merged with Punjab National Bank | Merged with Punjab National Bank | Merged with Punjab National Bank |
| United Overseas Bank Limited             | --        | --        | --        | --        | 1         | --          | --                         | --                               | --                               | --                               |
| Unity Small Finance Bank Limited         | --        | --        | --        | --        | --        | --          | --                         | --                               | --                               | 1                                |
| Utkarsh Small Finance Bank Limited       | --        | --        | 1         | 5         | 8         | 10          | 8                          | 14                               | 7                                | 7                                |
| Vijaya Bank                              | 30        | 27        | 57        | 32        | 22        | 2           | Merged with Bank of Baroda | Merged with Bank of Baroda       | Merged with Bank of Baroda       | Merged with Bank of Baroda       |
| Woori Bank                               | --        | --        | --        | --        | --        | --          | 1                          | --                               | --                               | --                               |
| Yes Bank Limited                         | 15        | 8         | 22        | 34        | 56        | 62          | 42                         | 37                               | 42                               | 98                               |

Source: RBI