. the bank frauds are primarily deposit related, advances related and services related. of these, the deposit related frauds which used to be big in number though not in size, have been on the wane, thanks to the improvements in cheque and payment processing, usage of technology and tightening the provisions of the negotiable instruments act. the advances related frauds continue to be the major concern for banks, especially because of their size and far reaching implications to their financial soundness and integrity. a special variety of frauds, which are increasing in number and in terms of speed, are the cyber frauds. yet another special type relates to trade or documentary credit related, special because of cross border implications. 7. when we discuss about bank frauds, we will not discuss about bank frauds committed by third parties which can suitably be classified as thefts. these types include cyber frauds committed by tricksters, or techsters. for our discussions, we will include bank frauds committed by some connected parties like the depositors, the borrowers, the users of bis central bankers ’ speeches bank services or by their own staff, their outsourced agencies, their vendors, their agents like assayers, valuers, auditors, etc. root cause of financial frauds 8. financial frauds, more specifically the advances related frauds, occur because of breach of contract and trust. it could be because of the pledged or mortgaged assets are compromised or divested off ; or the documents are forged ; or the funds availed are diverted or siphoned off ; or the documentary credits like the letters of credit or guarantees are misused, etc. 9. the root cause of financial frauds can be reduced to one single phenomenon. it is failure to know its somebody – i. e. failure to know its customer, or failure to know its employee, or failure to know its partner / vendor. bankers ’ response to frauds 10. what the fraudsters do not understand is the systemic response of banks when they have been tricked into facing the consequences of frauds. the bankers ’ reactions include withdrawal from lending, being risk averse, losing confidence in documentary credit, excessive collateralisation or documentation, demands on personal guarantees, collapse of need based lending systems like mpbf, tandon and chore committee norms, etc. these are in addition to the bankers ’ efforts to recoup the losses through higher interest rates and charges. the three ky principles

’ s pace of growth increased somewhat in the second half of last year, and that this persisted in the first few months of 2014. real gdp expanded at an annualised pace of about 3 per cent in the second half of 2013, up from just under 2½ per cent in the first half. business survey readings are broadly consistent with this picture. the march quarter of 2014 saw a further pick up, to something that was above trend, measured either in the quarter or over the year. a key question is the extent to which these recent national accounts data in particular illustrate the likely ongoing pace of growth. the results owed a lot to a very substantial rise in resource exports. this in turn reflected new capacity coming on stream and also unusually benign weather. while further rises in resource export volumes are expected, they are unlikely to be at the same pace. hence, the most recent set of gdp figures, while certainly encouraging, probably overstate somewhat the true ongoing pace of growth in the economy. the bank ’ s forecasts from early may, which we have not materially changed, embody ongoing growth but, in the near term, probably a little below trend. we will provide an update of forecasts next month. we could add sir edward ronald walker, professor of economics at the university of tasmania, adviser to the state government, head of the delegation to the 1945 paris conference, diplomat and chair of the un committee on full employment in the late 1940s. we could also mention professor gerald firth, who travelled from the uk to take up the ritchie research fellowship funded by giblin at the university of melbourne, was a senior economist in the department of post - war reconstruction and was professor of economics at utas for around 30 years. see charles bean, < http : / / www. bankofengland. co. uk / publications / pages / speeches / 2014 / 729. aspx >. it ’ s remarkable that sir roland wilson was, according to coleman et al., the first university graduate appointed to an administrative position in the commonwealth public service, in 1932. bis central bankers ’ speeches what are some of the key features of this outlook? the world economy continues to show moderate growth, probably a little below average but not by all that much. the advanced countries are seeing somewhat better outcomes than last year overall, while some emerging market economies slowed somewhat during the first half of 2014, including china. looking at domestic economic policies, the stance of monetary policy is very acc