The Reserve Bank of India (RBI) has asked banks to fix staff accountability for delays in reporting fraud cases to the banking regulator. The bank has warned of penal action for failure to convey the information within a time-frame. | |
| Most often the fraud reports are submitted to the RBI with considerable delay and lacking in required information also. Sometimes, the RBI comes to know about frauds involving large amounts only through press reports, the central bank has said in a circular to banks. |
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| The banks have been asked to ensure that the reporting system is suitably streamlined so that frauds are reported without any delay and specifically nominate an official of the rank of general manager who will be responsible for submitting all the returns to the RBI. |
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| The apex bank circulates details of frauds of an ingenious nature not reported earlier so that banks could introduce necessary safeguards by way of appropriate procedures and internal checks. |
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| The banks are also given the details of unscrupulous borrowers and related parties who have perpetrated frauds so that the banks could exercise caution while dealing with them. |
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| "To facilitate this ongoing process, it is essential that the banks report to RBI the full information about frauds and the follow-up action taken thereon," the circular said. |
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| The RBI has classified frauds as misappropriation and criminal breach of trust, fraudulent encashment through forged instruments, manipulation of books of account or through fictitious accounts and conversion of property, unauthorised credit facilities extended for reward or for illegal gratification, negligence and cash shortages, cheating and forgery and irregularities in foreign exchange transactions. |
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