FRAUDS BREIFLY

1. Banking Fraud
Types, Causes, Impact, and
Preventive Measures
Presented by: [Your Name]

2. Introduction to Banking Fraud
• Banking fraud refers to illegal activities
conducted to gain money or assets by
deceiving banks or customers.
• It involves manipulation of financial
documents, technology misuse, or unethical
practices.
• A major threat to banking stability and
customer trust.

3. Objectives of Studying Banking
Fraud
• Identify various types of frauds in the banking
system.
• Analyze causes and patterns of fraud.
• Assess financial and reputational impact on
banks.
• Suggest effective preventive measures.
• Support development of better policies and
systems.

4. Types of Banking Frauds
• Cheque Fraud
• Loan Fraud
• Credit/Debit Card Fraud
• Cyber Fraud / Phishing
• ATM Skimming
• Employee/Internal Fraud

5. Causes of Banking Fraud
• Weak internal controls and poor governance.
• Lack of employee accountability and training.
• Inadequate cybersecurity measures.
• Customer negligence and lack of awareness.
• Technological loopholes.

6. Case Study Example: PNB Scam
• PNB-Nirav Modi Scam (2018): Over ₹11,000
crore fraud.
• Involved fake Letters of Undertaking (LoUs).
• Exposed audit weaknesses and regulatory
lapses.
• Major damage to PNB’s reputation.

7. Impact of Banking Fraud
• Financial losses to banks and customers.
• Loss of public trust and confidence.
• Regulatory penalties and legal consequences.
• Higher operational costs for security.
• Damage to reputation.

8. Role of Technology
• Used in frauds: hacking, phishing, identity
theft.
• Used for prevention: AI-based detection,
biometrics, OTPs.
• Real-time transaction monitoring.

9. Legal & Regulatory Framework
• RBI guidelines on fraud classification and
reporting.
• Indian Penal Code (IPC) sections on fraud and
forgery.
• Information Technology (IT) Act, 2000.
• Banking Regulation Act.

10. Preventive Measures
• Strong internal audits and control systems.
• Employee training and background checks.
• Cybersecurity upgrades.
• Customer awareness campaigns.
• Regular software and system updates.

11. Suggestions & Recommendations
• Implement AI for fraud detection.
• Set up Fraud Risk Management teams.
• Promote whistleblower policies.
• Strict legal action against offenders.
• Collaborate with law enforcement.

12. Conclusion
• Banking fraud is a serious threat to financial
systems.
• Prevention needs cooperation from banks,
regulators, and customers.
• Technology and governance are key to fraud
prevention.

13. Bibliography
• Gupta, R. K. (2015). Banking and Insurance.
• Bhasin, M. L. (2016). Banking Frauds in India.
• RBI Annual Reports – https://rbi.org.in
• Economic Times –
https://economictimes.indiatimes.com