Lenders, on average, took 55 months to report large frauds

Bank frauds saw a whopping 73.8% jump in value in 2018-19 as compared to the previous year. In terms of number of cases, it was up 15%, the RBI’s annual report said.

“The number of cases of frauds reported by banks increased by 15% in 2018-19 on a year-on-year basis, with the amount involved rising by 73.8%, though mostly related to occurrences in earlier years,” the report said.

Banks had taken 55 months, on an average, to report large frauds.

The overall average lag between the date of occurrence and its detection by banks was 22 months, the RBI report said.

The average lag for large frauds, that is ₹100 crore and above, which amounted to ₹52,200 crore in 2018-19, was 55 months.

PSBs lead the pack

Among bank groups, public sector banks (PSBs), which constitute the largest market share in bank lending, have accounted for the bulk of frauds reported in 2018-19. These were followed by private sector banks and foreign banks.

“Cheating and forgery was the major component, followed by misappropriation and criminal breach of trust,” it said.

While the total number of counterfeit notes detected had fallen in 2018-19 to 3,17,384 pieces from 5,22,783 pieces in the previous years, what’s interesting is that 717 such notes of ₹1,000 denomination had been detected.

The ₹1,000 notes were withdrawn from circulation on November 8, 2016. The number of ₹2,000 counterfeit notes detected also increased in 2018-19 to 21,847 pieces from 17,929 pieces, the data showed.

There was also a sharp increase in the new ₹500 notes category, with 21,865 counterfeit notes detected as compared to 9,892 in the previous year.