Most bank frauds are 3rd-party scams: IBA

Most bank frauds are 3rd-party scams: IBA

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MUMBAI: Indian Banks’ Association chairman M V Rao has said that the threefold increase in bank frauds reported in RBI’s annual reports is largely due to customers being cheated by third parties, not breaches in banking systems. Rao called for increased awareness of early reporting within the ‘golden hour’ to address these frauds.
According to RBI’s annual report, frauds increased to 36,075 in FY24 from 13,564 in the year-ago period.It said that in volume terms, the frauds have occurred predominantly in the category of digital payments (card/internet).
“When you look into the root cause of these frauds, it’s not that they are committed by breaching bank systems, but rather someone has perpetrated the fraud on the bank’s customers. So, at the end of the day, my customer has lost. Ultimately, it is up to the bankers and the industry to see how we can protect the customer’s interests,” said Rao.
He was speaking at the inauguration of an online ‘bank clinic’ – launched by the All India Bank Employees’ Association of India – to advise customers to pursue a grievance with the bank. Rao said that the clinic should work towards creating awareness and that time was of the essence in digital frauds. Govt has set up the National Cyber Crime Reporting Portal and the national cyber crime helpline ‘1930’ to report cyber frauds.
Besides providing advice to customers on the way forward, the bank union would also take up customer issues with the bank’s management. Speaking at the event, AIBEA’s general secretary C H Venkatachalam said that the resolution of employee issues and wage revision under the 12th bipartite wage negotiation gave the union more time to focus on customer issues.

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