PNB fraud: Banks for raising cover against fraud by staff

NEW DELHI: Rattled by a spate of frauds in the banking sector, lenders are now planning to increase insurance cover against delinquencies by their employees to protect their bottomlines.

“Frauds of such magnitude and scale -- PNB fraud Rs 11,400 crore and OBC fraud Rs 390 crore -- has forced us to consider substantially much higher risk cover than the basic banker’s indemnity policy which various banks have right now,” a top public sector bank official said.

Besides, tightening internal risk mechanism and vigilance, banks have to look for higher cover to guard against such fraud where employees are involved, the official said, adding, this will help insulate the balance sheet.

Punjab National Bank had only bought a basic banker’s indemnity policy, which covers employee fraud, to the extent of Rs 2 crore which would not cover even 0.2 per cent of Rs 11,300 crore fraud done allegedly by Nirav Modi, Mehul Choksi and his associates in connivance with officials of a Mumbai branch.

Soon after this, a case of alleged swindling of Rs 390 crore from Oriental Bank of Commerce (OBC) was registered against a Delhi-based diamond jewellery exporter. In between there was a fraud case of Rs 3,695 crore by Rotomac Pen company owner Vikram Kothari in which the CBI filed cases and effected several arrests.

For example, SBI alone in 2016-17 reported frauds of Rs 2,424.74 crore (837 cases). Out of this, an amount of Rs 2,360.37 crore (278 cases) represents advances declared as frauds.

With faith on their own internal audit system and risk management, banks were not keen for higher cover but a series of frauds in the system have compelled them and in the recent Indian Banks’ Association meeting also the issue came up for the deliberation, the official of another public sector lender said.

However, the official said, cover can be for fraud not for the wilful default where number of lenders are involved and these two have to be dealt separately.

The official said for example the cases of Winsome Diamond Group and Nirav Modi are completely different, and the legal treatment and provision for both are diverse. BHUBANESWAR: President Ram Nath Kovind will inaugurate a museum dedicated to former Odisha chief minister Biju Patnaik next month.

The Museum and Learning Centre has been set up at Anand Bhawan, the ancestral house of Biju Patnaik in Cuttack. This was stated by Chief Minister Naveen Patnaik, son of Biju Patnaik, after his return from New Delhi here on Sunday. “I called on the honourable President at Rashtrapati Bhavan yesterday. Invited him to visit Odisha and dedicate the Anand Bhawan Museum and Learning Centre to the people,” Patnaik said after his arrival here. “The President has kindly agreed to the invitation and will inaugurate the museum either on March 17 or 18,” the chief minister said.

The ancestral house of Biju Patnaik, which has been converted to a museum in memory of the late leader, houses rare articles belonging to him and will give visitors a comprehensive insight into the life of the legendary personality, he said.

The Anand Bhawan property has been donated to the district administration of Cuttack in 2015 to convert it into a museum dedicated to Biju. His rare photographs, furniture, clothes and household items, which were lying in Anand Bhawan, would be on display in the museum, sources said. NEW DELHI: Amid a rising graph of crime against women in the country, they constitute just 7.28 per cent of the police force in India and at 2.47 per cent, their presence is the lowest in Naxal-hit Telangana, according to government data.

In militancy-affected Jammu & Kashmir, there are just 3.05 per cent women in a police force which has a sanctioned strength of more than 80,000 police personnel, Union home ministry statistics said.

The government data comes amid an increasing graph of crime against women in the country where overall crimes against them rose from 3,29,243 incidents in 2015 to 3,38,954 incidents in 2016.

The situation is pathetic despite the Union home ministry sending advisories in 2009, 2012 and 2016 to all the state governments and Union territories to increase the strength of women police personnel to 33 per cent, a senior ministry official said.

All state and UTS have also been requested to create additional posts of women constables and sub-inspectors and fill up vacancies by recruiting them, the official said.

As on January 1 last year, Telangana had just 2.47 per cent women in the rolls of its police force which has a sanctioned strength of 60,700 personnel, the data said.

In Uttar Pradesh, the country’s most-populous state, the police force has only 3.81 per cent women. It has a sanctioned strength of around 3,65,000 personnel.

The percentage of women in police forces in Andhra Pradesh, Madhya Pradesh and Meghalaya was also low, the statistics showed.

While Tamil Nadu has the highest number of women police personnel, the situation in Himachal Pradesh, Maharashtra and Goa was relatively better.

Among the Union territories, Chandigarh has the highest number of women personnel while the Delhi Police, with a sanctioned strength of around 85,000 personnel, had just 8.64 per cent women in its roll as on January 1 last year.

The home ministry has taken a number of steps for increasing the strength of women in paramilitary forces, another official said.

Women are expected to soon account for one-third of constable-rank personnel in the Central Police Reserve Force and around 15 per cent in the border guarding forces -- Border Security Force (BSF), Sashastra Seema Bal (SSB) and Indo Tibetan Border Police (ITBP), he said.

These forces together comprise around nine lakh personnel of whom only around 20,000 are women now.

The CRPF, considered to be world’s largest paramilitary force, is mostly deployed for law and order duties and the anti-naxal operations.

The year 2015 saw the registration of 34,651 cases of rape in the country and the figure increased to 38,947 in 2016.

Overall crimes against women also rose from 2015 to 2016, according to the data of the National Crime Records Bureau.

The majority of cases categorised as crimes against women were reported under cruelty by husband or his relatives, followed by assault on woman with intent to outrage her modesty, kidnapping and abduction and rape.

The highest number of rapes have been reported from Madhya Pradesh followed by Uttar Pradesh and Maharashtra in 2016.