Top 10 Banking Frauds in India

by Om Saroj
Banking Frauds in India

The banking sector is one of the most important sectors which is practiced in both the private and public sector. Although in recent years, there were several Bank frauds which rocked the Indian banking sector. In this article, we will discuss the top 10 banking frauds in India.

Top Banking Frauds in INDIA

  • Punjab National Bank Scam:
  • Rotomac case:
  • State Bank of India Fraud Case:
  • RP Infosystem Scam:
  • Punjab National Bank 91 Million Scam:
  • Karnataka Bank Fraud Case:
  • United Bank of India Case:
  • Andhra Bank Scam:
  • Bank of Maharashtra Fraud Case:
  • Canara Bank of Scam:
Banking Frauds in India
Banking Frauds in India

We have collected and list down the most damaging Bank frauds happened in India. These are the top 10 Bank frauds, which had the most impact on the Indian economy.

Punjab National Bank Scam

Banking Frauds in India

On 14th February 2018, one of the biggest scams happened which shocked the entire PNB industry. They were frauded by Billionaire Jeweler Nirav Modi by ₹ 11,400 Crore.

His business partner Mehul Choksi family members are the owners of Gitanjali Gems is having the account at PNB Brady House branch in Mumbai. After the investigation of this following scam, employees of the bank which includes the general manager suspended from their post due to the involvement in this scam.

The Government of India as revoked the passport of Nirav Modi and Mehul Choksi after this scam.

Rotomac case

Banking Frauds in India

Another scam was happened in Punjab National Bank by Rotomac which was around ₹ 3,700 Crores. The company was probed by enforcement directorate and CBI for cheating 7 banks.

The case was filed against the directors of business group Vikram Kothari and Rahul Kothari. The case was filed for misusing the credit which was sanctioned by Bank of Baroda.

Rotomac scam is still considered as one of the most impacting banking frauds which happened in India.

State Bank of India Fraud Case

Banking Frauds in India

State Bank of India got involved in banking scam with the jewelry network Kanishk Gold Pvt. Ltd. They were accused of prodding around 14 banks, and the fraud amount was around ₹ 824.15 Crore.

CBI and enforcement directorate registered case against Kanishk Gold after the fraud scam.

RP Infosystem Scam

Banking Frauds in India

Two directors of RP Infosystem were arrested by CBI for the scam of ₹515.15 Crore. The loan was taken from Punjab National Bank, Canara Bank and State Bank of India.

The loan was entirely taken on the basis of fabricated documents, which was, later on, came out after the investigation done by CBI.

Punjab National Bank 91 Million Scam

Banking Frauds in India

The first major scam was happened on Punjab National Bank for ₹ 12,000 Crores by Nirav Modi. Later on, Punjab National Bank also confirmed that another 91 million fraud also happened in March.

The fraud was done by Chandri Paper and Allied Products Pvt Ltd. The fraud happened from the same PNB Brady House branch in Mumbai, where the scam of Nirav Modi took place.

Karnataka Bank Fraud Case

Banking Frauds in India

On March 28, 2018, ₹86.47 Crore fraud what’s happened on the private banking sector Karnataka Bank. The fund was provided to the Gitanjali Gems Limited, initially connected to the promoter Mehul Choksi.

It was previously under the rider for the connection with mega banking scam from other different banks. Another major scam which happened in recent years, which is having a major impact and still one of the biggest frauds in the banking sector.

United Bank of India Case

Banking Frauds in India

A disproportionate asset case was filed by CBI in the first week of March 2018. The case was fought against Archana Bhargava, she was the former chairperson and managing director of United Bank of India.

The case was filed on the basis of acquired movable and immovable assets disproportionate to her income between the year of 2004 and 2014.

The exact amount of the fraud was not revealed by CBI, but still, it is one of the biggest scams happened in the Indian banking sector.

Andhra Bank Scam

Banking Frauds in India

On 13th January 2018, a former director of Andhra Bank director of Gujarat based Pharma Companies sterling biotech where arrested. The nearest to place after the ₹5000 Crore fraud case, 10 after they started withdrawing cash from bank accounts from various anonymous company accounts.

Previously the company was granted the loan ₹5000 Crore from the Andhra Bank. After the banking scam happened in Andhra Bank, loan converted into a non-performing asset of that particular company.

Must Read: 5 Myths you need to know about Mid Cap and Small Cap Funds

Bank of Maharashtra Fraud Case

Banking Frauds in India

The former head of Pune zone Maharashtra Bank was arrested by CBI, for ₹836 Crore fraud. This happened for violating the laws of sanctioning the amounts of two different companies.

The former head sanctioned credit to a logistic company on the basis of forged documents. The credit balance was sanctioned as a loan to 2,802 drivers for purchasing trucks.

It was a complete scam and later on, the investigation has happened after the negligence done by the formal head of Maharashtra Bank. This entire fraud case happened on 20th July 2017, and still one of the biggest scams happened in the banking sector.

Canara Bank of Scam

A company named Abhijeet Group’s promoters of mining company were arrested due to the defaulters in the loan payment.

This fraud case happened on 13th June 2017, they had a loan amount of around 11,000 to 15,000 Crore, which was taken from 20 different banks and other financial institutions.

This particular company has created another vehicle company named Jas Infrastructure.

They were providing a contract for procurement and construction of power plant, erection at Bihar to their group of Companies. Abhijeet Group was accused of misusing the loan which was taken from Canara Bank and Vijaya Bank.

The initial amount which was estimated in this scam was ₹790 Crore.  This is definitely one of the biggest examples of banking fraud, which happened in India.


Frauds can happen in any sector, although most of them are harmful enough to provide impact in the Indian economy.

We have collected the complete information about various bank frauds which happened in India from different sources and posted them in this article for you.

Share this informative article with others, so that they get to know about the bank frauds which caused damage to the Indian economy.

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