Banking Frauds Of Over Rs 1,000 Crores Witness Significant Decline In Fraud Cases In FY22

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The Indian banking sector saw a significant decline in fraud cases of sums over ₹100 crores in 2021-22. The banks reported cases worth ₹41,000 crores in 2021-22 compared to ₹1.05 lakh crores in the previous year.

According to official data, the number of fraud cases in the public and private sector banks fell from 265 in 2020-21 to 118 in the financial year 2022.

What Does RBI Data Say?

According to the data released by the Reserve Bank of India in the case of public sector banks, the total number of fraud cases over ₹100 crore dropped from 167 in FY21 to 80, and in the case of private sector banks, it fell from 98 in FY21 to 38.

When it comes to cumulative amount, it has come down to ₹28,000 crores from ₹65,000 crores in FY21 in case of public sector banks and from ₹39,900 crores to ₹13,000 crores in case of the private sector.

Steps Taken To Check Frauds

RBI has taken various steps in a bid to check frauds. It has been improving the efficacy of the Early Warning System(EWS) framework, strengthening fraud governance and response system, augmenting data analysis for transaction monitoring and introducing dedicated Market Intelligence (MI) Unit for frauds.

During 2021-22, the RBI carried out a study on implementing the EWS framework in select Scheduled Commercial Banks in collaboration with the Reserve Bank Information Technology Private Limited (ReBIT). Machine Learning(ML) algorithms were used to assess the effectiveness of EWS in select banks.

Biggest Banking Frauds Of 2022

According to a report by The Hindu, the State Bank of India(SBI) reported a fraud which amounted to ₹22,842 crores and was perpetrated by ABG Shipyard and its promoters.

In June, Dewan Housing Finance Ltd (DHFL), its former CMD Kapil Wadhawan, director Dheeraj Wadhawan and others were booked by the Central Bureau of Investigation (CBI) in a new case involving ₹34,615 crores. It is the biggest brank fraud probed by the agency.

Union Bank of India-led consortium alleged that DHFL had availed credit facility to the tune of ₹42,871 crores between 2010 and 2018 from the consortium under various arrangements. But, it started defaulting on repayments from May 2019 onwards. The banks declared these accounts as non-performing assets. The 17 banks in the consortium had to suffer a loss of ₹34,615 crores.

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