Brighter Kashmir: Srinagar: Tuesday,
March 14, 2017.
ammu and
Kashmir Bank has lost Rs. 1157.84 crore to 41 frauds during the last four years
from 2013-14 to December 2016. However, the bank has started to regain its lost
ground since the day new chairman Parvaiz Ahmed has taken the charge.
According to
an official document of Reserve Bank of India (RBI), the hard-earned money of
the commoners deposited in the banks has been lost by the bank not only to the
VVIP customers but the employees of bank have also played active role in
committing frauds worth crores of rupees. The bank on its part has stonewalled
all efforts for being brought under the purview of the RTI act.
The RBI
document reveals that 11 employees of Jammu and Kashmir Bank were also involved
in bank having lost Rs. 1157.84 crore to 41 frauds during the last four years
from 2013-14 to December 2016. The bank lost highest amount of Rs. 902.86 crore
to the seven loan frauds in the year 2014-15 when the Chairman was Mushtaq
Ahmed, a bank official who was known for his proximity with National Conference
(NC) which was then in power.
These seven
frauds were committed by VVIP customers. Though the bank claims that no
official from the bank was found involved in these frauds but the fact remains
that these loans were sanctioned were some of the so-called brightest Bank
managers of the Bank. These included Managers of Residency Road Branch in Jammu
and some other branches of Kashmir valley. During the tenure of Mushtaq Ahmed,
JK Bank lost more than Rs. 1000 crore to the fraudsters.
In the year
2013-14, the Bank lost Rs. 66.2 lakh in 7 cases of fraud involving several
VVIPs and 3 bank employees. This was followed by Bank loosing another Rs. 86.6
Lakh to 14 banking frauds involving 6 employees of the bank, whose identity has
been kept secret by the top management of the bank, says the RBI document.
During the current financial year, the bank has lost around Rs. 239.69 crore to
the frauds with just 2 employees being allegedly involved in this huge fraud.
According to
documents accessed from the Ministry of Finance, these losses are only due to
frauds of Rs 1 lakh or more. Some of these cases are being probed by
investigating agencies. Reserve Bank of India (RBI) has issued Master Direction
on “Frauds-Classification and reporting” vide RBI.
DBS.CFMC.BC.No.1/23.04.001/2016-17
dated July 01, 2016 containing all the details/aspects relating to frauds. To
compress the time taken in detection of fraud, a framework for handling loan
frauds has been put in place.
According to
the RBI, objective of this framework is to direct the focus of banks on the
aspects relating to prevention, early detection, prompt reporting to the RBI
and the investigative agencies (for instituting criminal proceedings against
the fraudulent borrowers) and timely initiation of the staff accountability
proceedings.
Sources said that the framework also seeks to
stipulate time lines with the action incumbent on a bank. Further, the
framework has also prohibited banks from extending bank finance to borrowers
who have defaulted and also committed a fraud for five years from the date of
full payment of the defrauded amount.
They added
that on receipt of fraud reports from banks, various aspects related to the
frauds are examined and concerned banks are advised to report the case to CBI,
Serious Fraud Investigation Office, examine staff accountability, complete
proceedings against the erring staff expeditiously, take steps to recover the
amount involved in the fraud, claim insurance wherever applicable and
streamline the system as also procedures so that frauds do not recur.
Though it is
said that a whenever a complaint against a bank official(s) is received and any
irregularities are found or observed on the part of Banks’ official (s), the
Banks initiate action as per their extant rules and commensurate punishment is
awarded to the delinquent employees based on the seriousness of the wrongdoings
as per Bank’s disciplinary rules but the fact remains that Jammu and Kashmir
Bank is yet to make any such thing public.
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