Police say these cases underscore the urgent need for stronger audits, tighter access controls, and greater transparency to restore trust in the banking system and protect customers from insider-driven fraud
A series of recent investigations has drawn attention to deep-rooted weaknesses in banking oversight, revealing how trusted insiders have misused their positions to defraud customers—particularly non-resident Indians (NRIs) whose accounts often remain inactive for long periods. Police officials say these cases point to systemic lapses rather than isolated misconduct, with internal controls repeatedly bypassed by those entrusted to enforce them.
The trail began with a customer complaint in Chennai that uncovered manipulation within a local bank branch. Investigators found that senior staff had allegedly exploited dormant accounts by forging signatures and pledging gold ornaments without the knowledge of account holders. Loans were raised in the names of inactive customers, while the transactions were masked as routine operations. What initially appeared to be a single instance soon revealed a familiar pattern: insiders identifying low-monitoring accounts and using internal access to delay detection.
Complaints from NRIs have played a critical role in exposing the scale of the issue. Many such accounts, including NRO and NRE holdings, are not monitored frequently by their owners, making them vulnerable to abuse
Another high-profile case involved a branch manager who disappeared after allegedly convincing depositors to invest large sums with promises of unusually high returns. Complaints later alleged that funds were siphoned from fixed deposits and investment accounts through forged documentation. Police believe the accused fled abroad, prompting the issuance of an international alert. Investigators say the episode highlighted the risks that arise when decision-making authority is overly concentrated in one individual, allowing safeguards to be overridden.
Misuse of locker facilities has also emerged as a recurring concern. In one instance, a bank official allegedly accessed a customer’s locker without authorisation, removed gold jewellery, and sold it through informal channels. Similar cases have revealed unauthorised withdrawals spread over several years, enabled by forged cheques, manipulated vouchers, and the assumption that internal verification would not be questioned.
According to the Central Crime Branch, at least 18 cases involving fraud, forgery, and misappropriation have been registered this year alone. Sixty-seven individuals—mostly bank employees or managers—have been named as accused, with nearly 50 arrests made so far. Several suspects remain absconding, while others are under investigation.
