Enhanced Guidelines for Reporting Banking Fraud to ABBFF in India

Introduction

This document outlines the extension of the scope of the Advisory Board for Banking and Financial Frauds (ABBFF), specifically addressing the handling of fraud cases within Public Sector Banks (PSBs) and Public Sector Financial Institutions (PSFIs). The Central Vigilance Commission (CVC) has implemented this extension to enhance vigilance and address fraud incidents more effectively.

Extension of ABBFF Scope

On January 6, 2022, through Office Order No. 02/01/22, the CVC, in collaboration with the Reserve Bank of India (RBI) and the Department of Financial Services, announced that the ABBFF will now address all fraud cases involving amounts of ₹3 Crore and above. This new guideline ensures a comprehensive review of all officials and Whole Time Directors, including ex-officials/ex-WTDs, in instances of fraud.

Key Guidelines for Referral to ABBFF:

The following cases must be reported to the ABBFF:

New Fraud Reports: Any fraud case classified and reported to the RBI on or after January 6, 2022, with the total amount ranging from ₹3 Crore to ₹50 Crore by PSBs.
Pending Cases: If a fraud case involving ₹3 Crore to ₹50 Crore was reported prior to January 6, 2022, but has reached the Disciplinary Authority through the Integrity and Assurance Committee (IAC) and Chief Vigilance Officers (CVO) post this date, it should also be referred to ABBFF.
Unfiled Cases: Cases where a Fraud Monitoring Report (FMR) was filed or fraud was declared by PSFIs prior to January 6, 2022, but a criminal complaint has not yet been lodged with the investigative agencies, must also be reported to ABBFF.

Terms and Conditions:

All other stipulations under the CVC Office Order No. 14/08/21 dated August 19, 2021, remain unchanged and will continue to be applicable.

Standard Operating Procedures (SOP):

The SOP for referencing cases to the ABBFF, established in previous communications, will also apply to fraud cases within the ₹3 Crore to ₹50 Crore range.

Implementation and Compliance

All institutions are required to ensure strict adherence to these guidelines. It is crucial that all officers and officials at every institutional level are informed of these updates to facilitate compliance.

Future Considerations

Depending on the volume of cases, separate boards may be established for handling cases with fraud amounts between ₹3 Crore and ₹50 Crore. Additionally, a Secretary to the Board will be appointed on a part-time basis from the pool of retired PSB officers, ensuring they possess the requisite experience in vigilance and fraud management.

Conclusion

The adjustments made by the CVC reflect a proactive approach towards combatting financial fraud in the banking and financial sectors. With enhanced scrutiny and clear reporting directives, the ABBFF aims to uphold integrity and accountability within Public Sector Banks and Financial Institutions. Institutions must disseminate this information promptly to promote thorough compliance and accountability.