Page 33 - BANKING FINANCE APRIL 2017

ARTICLE

n) Closure of accounts within a short span of time say,
within 6 months.

Role of Vigilance Department:

Vigilance Department shall be responsible for detailed in-
vestigation of fraud cases wherever required. Vigilance
Department shall also ensure that investigation of frauds and
internal punitive actions are completed within a reasonable
period of time. Banks shall have a Special Investigation
Team, which would be a part of Vigilance Department. Bank
shall ensure that Special Investigation Team is adequately
manned with officials having experience in branch banking,
3. The surveillance system could inter alia cover analy- specialization in IT for data extraction / data filtering / data
sis of the following: sanitization and audit. All the team members shall be pro-
a) All Transactions of Rs.1.00 Crore and above, in Cur- vided with extensive training in areas of transaction bank-
rent/ Saving/ Term Deposit/ Cash Credit/ Overdraft ing, audit including forensic audit, IT applications used in
Accounts. banking etc.
b) All Cash Transactions of over Rs.10.00 Lacs (taken
The Special Investigation Team shall also perform the
care by KYC/AML)
Post Facto Fraud Investigation/ gathering information/
c) All Remittances Transactions of Rs.50.00 Lacs and
super flows /evidences /and creation of credible records
above (inward as well as outward) through RTGS/
that are useful for internal management action or legal
NEFT. prosecution against wrong doers. Vigilance Department
d) All Transactions of Rs.5.00 Lacs and above in shall ensure that Best Practices Code is prepared by all func-
impersonal accounts viz. Suspense Account / Sun- tional departments to be followed for their respective ar-
dry Deposit / POB /Bills Payable/Local Branches / eas.
Central Office.
e) All Transactions over Rs.1.00 Lac in Expenditure ac- Role of Risk Management Department:
count (other than Interest) Risk Management Department shall ensure that all Corpo-

f) All Transactions in Dormant Accounts. rate Office departments prepare a comprehensive list of
their products/services and assess the risk areas and the
g) All Transactions resulting in Overdraft (not under
controls existing there against. Such a list of risk areas for
limits) / Excess over Limit/Drawing Power.
each product/service rendered may be prepared by refer-
h) List of Advances Accounts where outstanding bal- ring to the various instances of frauds previously occurred
ance has come to zero but the account is not in that area and based on reasonable judgment of poten-
closed. tial risk areas where frauds could occur.
i) All subsequent debit transactions in such accounts.

j) Details of instances where preferential rate of in- Staff Accountability
terest is granted (both Deposits and Advances) 1) It is necessary to conclude the disciplinary proceedings/

k) Details of modifications (non-financial transactions) departmental action expeditiously, more particularly in
respect of frauds with insider involvement and punish-
done regarding limits and rate of interest.
ment commensurate with the crime should be meted
l) Intersol Transactions immediately on opening of the out to such fraudsters / their accomplices. The overall
account.
emphasis will be on the consistency in the award of the
m) Sudden spurt in Advances in the branch. punishment to staff, whose negligence / crime had re-

BANKING FINANCE | APRIL | 2017 | 33

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