Page 17 - Banking Finance July 2025

The arrests highlight growing concerns Kerala HC Orders Bank of
over governance and accountability in Attention Subscribers
Kerala’s cooperative banking sector, Baroda to Refund Fraud Please renew your Subscription of The
already under scrutiny due to rising Victims with 6% Interest Insurance Times Journal to receive
NPAs and systemic irregularities. The The Kerala High Court has directed copy of the journal uninterruptedly.
VACB has assured strict action and fur- Bank of Baroda to refund the amounts You can now pay by GPAY, Phonepe,
ther investigations into similar com- lost by two customers in a bank fraud Paytm, Amazon, ICICI Pay, BHIM UPI
plaints across other cooperative banks.
case, along with 6% interest, reaffirm-
ing the bank's liability for lapses in pro-
Andaman Cooperative tecting customer accounts.

Bank MD, Employee Ar- The court ruled that banks cannot es-
rested in Rs. 5.5 Crore cape responsibility when fraud occurs
due to negligence in maintaining
Loan Scam cybersecurity and safeguarding cus-

In a major crackdown, the Managing tomer information.
Director and an employee of the
The customers had fallen victim to
Andaman and Nicobar State Coopera-
unauthorised electronic transactions
tive Bank have been arrested in con-
and immediately reported the inci-
nection with a Rs. 5.5 crore loan scam.
dents to the bank. However, the bank
The accused allegedly sanctioned mul-
failed to act promptly, neither blocking
tiple loans by bypassing standard pro-
the accounts nor reversing the fraudu-
cedures and fabricating documents,
lent transfers.
causing significant financial loss to the
Justice Devan Ramachandran, deliver-
bank.
ing the verdict, emphasized the impor-
The case came to light during an inter-
tance of bank accountability in the digi-
nal audit that flagged irregularities in
tal era, especially when customers act
loan approvals, prompting a detailed
in good faith and report frauds swiftly.
probe. Investigators found that loans
were granted without adequate collat- The judgment is expected to set a pre- Sashi Publications Easy Payment
eral or proper verification of borrower cedent for similar cases and reinforces Modes :-
credentials. The suspects are believed the need for robust fraud response i) UPI ID: SASHIBOOKS@KOTAK
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to siphon off funds through shell ac- to protect depositor interests. iii) PAYTM: 9830171022@paytm
counts and forged identities. iv) NEFT: Current A/C

Authorities have seized documents Join 402120110000327 of 'SASHI
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and digital records linked to the Online Certificate
fraudulent transactions, and further LIMITED, Bank of India, VVK
Road Branch., Kolkata, India,
arrests are likely as the investigation
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The incident has raised serious con- www.sashipublications.com
cerns about governance and internal
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16 | 2025 | JULY | BANKING FINANCE