Government to operationalise online database of bank frauds

Investigative agencies, including CBI, ED, Central Economic Intelligence Bureau, likely to be asked to share their database of economic offenders with banks.

Published: 14th March 2018 02:08 AM  |   Last Updated: 14th March 2018 05:39 AM   |  A+A-

Commuters walk past a bank sign along a road in New Delhi, November 25, 2015. | Reuters

Express News Service

NEW DELHI: To prevent banking frauds, the government is set to operationalise the Central Fraud Registry, an online database of bank frauds, while also considering allowing the Central Bureau of Investigation (CBI) and Central Economic Intelligence Bureau (CEIB) to share their database of economic offenders with banks.

“Among the many protective measures to safeguard the banking system, a major one will be implementing the Central Fraud Registry. It will be a central database which will be accessible to all banks and will have the names and details of the fraudster, their companies and businesses and other useful details,” an official in the Ministry of Finance said.

The Central Fraud Registry is not a new concept. The government had announced that it was being set up in 2016 with a database covering 13 years. It was supposed to be a web-based searchable database of frauds reported by banks. However, it had remained a non-starter until now, with the RBI not in favour of making names of fraudsters and bank loan defaulters public.The recent series of high-profile bank fraud cases, however, seems to have pushed the government to make the central database operational and fully functional.

“This is going to be a major step, once fully implemented. Suppose someone applies for a loan, the bank will quickly search the name, passport details and look for fraud history or NPAs. They can also see the track record of the company in a couple of minutes and can take a decision on whether to sanction a loan or not,” the official said. The source added that there was also a proposal to make the database public, but the government had not taken any decision in this regard.

The government is likely to ask investigative agencies to share their database of economic offenders.

“The government is also considering a proposal which will ask the Central Bureau of Investigation, Central Economic Intelligence Bureau, Income Tax Department and Enforcement Directorate to share databases of economic offenders. It will not only help the banks be more careful in sanctioning loans and prevent scams, but will also help the investigative agencies with their probes,” the official added.

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