While speaking at the PHD Chamber of Commerce and Industry's (PHDCCI's) fraud awareness event, the officials of the Reserve Bank of India (RBI) have said that data leakage is rampant and there is a need to guard against fraud.
Brijlal Singh, Deputy General Manager, RBI said that fraud is now one of the most common topics in newspapers, and everyone is vulnerable to it. The only way to protect oneself is through awareness and precautions, as fraud takes many forms and data leakage is rampant. Driven by ignorance, greed, and fear, financial fraud highlights the need for awareness programs.
Singh discussed that cybercrime is projected to cost the world USD 17.65 trillion annually by 2025, with factors like anonymity and trans-border syndicates contributing to it. He further mentioned various types of fraud such as ATM fraud, which is prevalent due to the high percentage of cash transactions, and card skimming which is now mitigated to some level after introducing the chip system.
“The cheque fraud is also addressed by the RBI’s 'positive pay system,’ and further discussed on fraudsters employing corporate-like strategies, fake KYC updates, and advanced technology like deepfakes. Mr Singh added that it was a myth that fingerprints cannot be copied. With someone’s Aadhaar number, fingerprints can be easily duplicated and frauds committed, misusing a facility initially meant for convenience,” Singh stated.
Singh also informed about the DoT Sanchar Saathi portal, which has had 4.15 crore visitors since its launch, and emphasised its service, the Chakshu app, where one can report fraudulent activity immediately. He highlighted the I4C - Indian Cyber Crime Coordination Center, noting that its response is immediate and quick compared to the 30-day lag in the ombudsman process.
Digital literacy and awareness are the only solutions. Mule accounts are an issue related to KYC. Initially, no one is aware of them, but they only become aware after transactions have been made. We have advised banks to monitor such accounts, concluded Singh.
Veena Rana, Deputy Ombudsman, RBI briefed about the scheme which was inaugurated by Prime Minister Narendra Modi in 2021. She gave an overview of the Ombudsman scheme and its history and mentioned that any customer aggrieved by an act or omission of a regulated entity resulting in a deficiency in service can file a complaint under the scheme personally or through an authorised representative (other than an advocate).
She further informed that ways to file a complaint include writing on plain paper and sending it to CRPC, Chandigarh, or through mail or the online portal. She added that there is no limit to the amount that can be complained about, but there is a compensation limit of Rs 20 lakh for consequential loss and Rs 1 lakh for mental anguish. Additionally, she discussed the national cybercrime reporting portal, which can be reached by dialling 1930.
S K Sethi, Co-Chairman, PHDCCI BFSI Committee said that greed is the trap of any fraud. It is important to learn safe banking habits, become aware of various modus operandi used by fraudsters, and understand how to protect oneself against financial fraud while also avoiding the display of sensitive information, especially regarding banking details. Today’s program aimed to cover the digital banking landscape, types of financial fraud and the prevention of these frauds.
The purpose is to delve into safe digital banking practices and the RBI Integrated Ombudsman Scheme 2021 (RBIOS-2021). It is important to learn when and how to seek redress. Further, Sethi believed that the program would help build greater trust and confidence in the banking system.
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