RBI slaps Rs 65 lakh fine on Mahesh Bank for failing to boost cyber security

Express News Service | Published: 02nd July 2023 12:24 PM
Image used for representative purposes only. (File Photo | Express)

HYDERABAD: The Reserve Bank of India (RBI) imposed a fine of Rs 65 lakh on the AP Mahesh Co-operative Urban Bank Ltd. for failing to provide cyber infrastructure and efficient firewalls as a result of which a loss to the tune of Rs 12.48 crore was caused due to a fraud committed by Nigerian in January 2022. According to the police, a cybercrime case was reported by the bank on January 24, 2022. Investigation found that a hacker breached the bank’s systems and siphoned off Rs 12.48 crore during the weekend.

The act was carried out by the fraudster by sending the employees of the bank a series of phishing emails. Upon opening the emails, systems were compromised, providing the fraudster full access to the bank’s network. During the investigation, it was revealed that the people with small savings were lured by the Nigerian with commission to get access to their bank details. The fraudster first transferred the money in small amounts to these accounts before siphoning off it to an unidentified account.

This investigation also revealed bank’s negligence in putting in place cyber security measures such as an anti-phishing application, intrusion prevention and detection systems, and real time threat defense and management systems, as mandated by the RBI.

During the investigation, Cybercrime sleuths found security components absent within the bank’s cyber security infrastructure. Hyderabad City Police Commissioner CV Anand corresponded with the RBI Governor, highlighting the critical lapses and requesting for the suspension of the bank’s license to operate.

Tags : Reserve Bank of India AP Mahesh Co-operative Urban Bank Ltd.

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