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Citi bank fraud case trust on relationship manager


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Citi bank fraud case trust on relationship manager

  1. 1. The CitiBank Fraud Case Prepared by: Ravi Baravaliya (M00037) Chetan Panara (M00086) Nikunj Patel (M00023) Bhavin Patoliya (M00025) Mahipal Chauhan (M00052)
  2. 2. Indian Banking Industry Reserve Bank of India Act 1934 Indian Banks Can be Categorized two Parts:  Scheduled Commercial Banks Public Sector Banks Private Sector Banks Foreign Banks  Unscheduled Commercial BankSource:
  3. 3. Citibank World Wide CEO-chairman Leading financial service company Business in 140 country 200 million customer Broad range of financial service Citibank in Asia
  4. 4. Citibank India Established in 1902 Total business in India Employee Principle of banks in India Job of Relationship manager
  5. 5. Relationship Manager’s job at Citibank Primary job Other job
  6. 6. Modus OperandiShivraj Puri – Relationship Manager, Gurgaon branch Collection of funds HNI & Corporate 51 HNI, Hero Group, Helion Advisors Pvt. Ltd. Custodian Account - Premnath
  7. 7. Sheila Premnath Deeksha Puri Shivraj Puri Brokerage Account Religare Securities Ltd., Bonanza Portfolio Ltd., India Info line Ltd Normans Martin Brokers Pvt. Ltd. (Raghuraj Puri) Investment in to Capital Market
  8. 8. Gullible InvestorsHow Easily tricked by Mr. Shivraj Puri ?Investors are greedy for 25 % Rate of Return vs Puri’s Greed. How fool of Customers?  Signing cheques  Electronic fund transfers to an individual account.  Fake Excel sheet statements.  Portfolio management services. Others Reasons :  Nuances are not Clear.  Extent of Loss are also not known.  Citibank liability is not clear.  Excuse by Bank.(Awards)  City insider only hopeful about part of money recover.
  9. 9. Cont…  Mr. Puri is concentrated on only Looting Investors.  There is a Personal touch in whole Relationship.(Start a bank)  Mind of Mr. Puri for Investors Vs Hero Group (Looting by employee).  Name of Investor:  Munjal Family (Hero Group) / Through Sanjiv Gupta / Lost 28.89 crore.  Sanjiv Agrawal (Venture capitalist) (33 crore lost)  Relationship Master: (Joint family venture) “Fraud Based on Relationship with help of Relationship.”  System is working for Mr Puri.  Note:  HNIs’ have no time to manage their money and leave the job to Wealth and Relationship managers.
  10. 10. Process of System HNI – Minimum investments Rs.10 lacs Bank’s close ended offers and RM’s took unfair advantage Trust build up Creates own SPV (Assumptions) Technology savvy bank – keep records of all transactions
  11. 11. A System Failure? Fake SEBI circular Misrepresentation of high return Amount transferred in family’s Saving account Transferred in family’s Demat account Higher authorities are unaware about these large transactions on daily basis SEBI and RBI are still unaware
  12. 12. Lesson from Citibank Fraud Verification of Relationship manager Customers should not get carried away by big names Customers should be clear on their own financial goal The customers should not lend their signature to any document without understanding the implications of the document. The internal controls and systems of the wealth management entities should be clearly defined