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.
