Banks told to set up anti-fraud wing as wilful defaults mount

     
Feb 24, 2019
NEW DELHI: The Government has asked all banks to set up a separate fraud prevention wing to detect potential wilful defaults at an early stage.

Although the banks were using insolvency clauses to prevent defaults, they have recorded a substantial rise in wilful defaults in 2018, according to data from Cibil, quoted by Mint.

The RBI had wanted them to refer more than three dozen defaulting companies to the National Company Law Tribunal (NCLT). 1,484 cases have been reported to the bankruptcy court in two years.

IDBI Bank topped wilful defaults among public sector banks, such defaults becoming double from Rs 3,660 crore to Rs 7,381 crore in one year. This is more than 13% of the bank’s gross non-performing assets (NPAs).

Other public sector banks such as Bank of India (BOI) and Bank of Maharashtra (BOM) followed the list.

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