07:21 GMT09 August 2020
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    New Delhi (Sputnik): Fraud in the Indian banking system is being reported despite the government having a framework for the timely detection, reporting, an investigation of such incidents. The Fugitive Economic Offenders Act, 2018 was enacted to deter offenders from getting around Indian law by remaining outside the jurisdiction of Indian courts.

    India's Finance Minister has informed Parliament that banking sector fraud worth $13.68 billion has been reported in just six months ending this September. This has already surpassed the $10.21 billion in banking fraud reported in 2018-19.

    “Frauds as reported by Public Sector Banks (PSBs), during the period from 1 April to 30 September is 5,743 involving a total amount of $13.68 billion,” Finance Minister Nirmala Sitharaman shared with the Parliament’s upper house Rajya Sabha.

    This compares quite poorly with the amount of fraud reported in Indian PSBs in 2018-19. During this period, Indian banking sector fraud amounted to $10.21 billion.

    From April to September of this year, India’s biggest lender, the State Bank of India reported 2,939 cases of fraud involving $3.63 billion. This was followed by the Punjab National Bank, which reported 225 cases between April and September but remained second in the dollar amount of fraud committed at $1.54 billion. This essentially means that the size of individual fraud cases is larger in PNB than SBI.

    Indian public sector banks have also been advised to obtain a certified copy of the passport of those applying on behalf of companies for loans in excess of $7 million.

    New Delhi has been dealing with fraud in public sector banks for some time. Some high-profile cases include fugitive Indian diamond baron Nirav Modi, who is fighting extradition to India over $2 billion in fraud charges and money laundering.

    That case is pending before Westminster Magistrates Court, while Indian liquor baron Vijay Mallya is also contesting an appeal against his extradition in a London court. Mallya is facing fraud and money laundering charges to the tune of $1.28 billion.

    The Fugitive Economic Offenders Act, 2018 provides for the confiscation of property as well as assets a fugitive economic offender.


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