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Saturday, July 11, 2020

Strange ! ~ SBI duplicate Branch unearthed at Panruti !!

For years, Fifth Third Bank, a large regional bank based in Ohio, opened unauthorized accounts in customers’ names as part of an aggressive sales strategy that foisted credit cards, online banking services and other products on people without their knowledge, according to a lawsuit filed on Monday by one of the bank’s federal regulators.  The bank “set goals that thousands of its employees could not achieve” and penalized those who fell short, the Consumer Financial Protection Bureau said in a complaint in federal court in Chicago. The misconduct stretched back to at least 2008, and the bank failed to sufficiently respond to internal warning signs, the consumer bureau said.

With the number of bank frauds increasing, one should eb  doubly careful about transactions, especially online ones. According to the Reserve Bank of India’s (RBI) annual report for 2018-19, the number of cases of frauds reported by banks increased by 15% in 2018-19 on a year-on-year basis, with the amount involved rising by 73.8% from Rs.41,167 crore in 2017-18 to Rs.71,543 crore in 2018-19.

It is not only Bank’s customers getting cheated but also Banks getting cheated !  Over  two years after Manjit Singh Makhni, the Director of Punjab Basmati Rice Ltd, fled the country, the Central Bureau of Investigation (CBI) has now registered a complaint against him for defrauding Canara Bank-led consortium of six banks of around Rs 350 crore.  Canara Bank has filed a complaint with the CBI, alleging that Punjab Basmati Rice has cheated six banks to the tune of Rs 350 crore. The complaint was filed on 1 June by the General Manager of Canara Bank, Chandigarh against Punjab Basmati Rice and its directors Manjit Singh Makhni, his son Kulwinder Singh Makhni, his daughter-in-law Jasmeet Kaur and unknown public servants. As per reports, all the accused have left the country.

Remember watching in Marina Grounds, a Buchi babu match – when stalwarts Gundappa Viswanath, Parthasarathi Sharma, Rajinder Goel, Syed Kirmani, Vaman Kumar, Abdul Jabbar, Eknath Solkar all played for State Bank of India.

SBI is one of the largest employers in the country with more than 2 lakhs employees of which a high % is female employees and a % of  employees with disabilities. They have highest no. of Branches across the Nation too.  State Bank of India (SBI)  at the start of the  year issued public notice to its  customers urging them to complete KYC. The lender  asked all SBI account holders to complete their KYC in order to avoid inconvenience in the future. The bank also said in the public notice that if an SBI customer fails to complete one's KYC by February 28, 2020, then it will have no choice but to block such SBI accounts till the KYC is completed. .. .. perhaps they failed to check their own KYC.

The biggest of the Indian bank with branches overseas too, is a Government corporation statutory body headquartered in Mumbai, Maharashtra. SBI is ranked as 236th in the Fortune Global 500 list of the world's biggest corporations of 2019.  The bank’s origin traces back to the Bank of Calcutta, founded in 1806, via the Imperial Bank of India, making it the oldest commercial bank in the Indian subcontinent. The Bank of Madras merged into the other two "presidency banks" in British India, the Bank of Calcutta and the Bank of Bombay, to form the Imperial Bank of India, which in turn became the State Bank of India in 1955. The Government of India took control of the Imperial Bank of India in 1955, with Reserve Bank of India (India's central bank) taking a 60% stake, renaming it the State Bank of India.  In 1959, the government passed the State Bank of India (Subsidiary Banks) Act. This made eight banks that had belonged to princely states into subsidiaries of SBI. This was at the time of the First Five Year Plan, which prioritized the development of rural India. The government integrated these banks into the State Bank of India system to expand its rural outreach. In 1963 SBI merged State Bank of Jaipur (est. 1943) and State Bank of Bikaner (est.1944).

SBI has acquired local banks in rescues. The first was the Bank of Bihar (est. 1911), which SBI acquired in 1969, together with its 28 branches. The next year SBI acquired National Bank of Lahore (est. 1942), which had 24 branches. Five years later, in 1975, SBI acquired Krishnaram Baldeo Bank, established in 1916 in Gwalior State, under the patronage of Maharaja Madho Rao Scindia.   In 1985, SBI acquired the Bank of Cochin in Kerala, which had 120 branches. SBI was the acquirer as its affiliate, the State Bank of Travancore, already had an extensive network in Kerala.

All that is past ! ~ now comes an eerie instance of a duplicate bank branch in operation – have heard of fake cheques, fake accounts, fake credit cards, fake currency notes – but it takes a lot to open and operate a bank branch that was fake !!

The duplicate branch came under the radar when an SBI customer enquired about the newly-opened branch in North Bazaar with the manager of an existing branch in the town.  Indian Express and mainline media reports that a person by name Babu, along with A Kumar, M Manickam, had opened the branch in April amid the lockdown, with an assumption that they would not be caught.

Tamil Nadu Police have arrested three persons for running a duplicate State Bank of India (SBI) branch in Panruti in Cuddalore district. According to the police, Kamal Babu (19), the son of a former SBI employee, had brought computers, lockers, challans and forged documents, among other items, to set up the branch through his contacts. A website was even created in the name of the Panruti Bazaar branch. Babu, along with A Kumar (42), M Manickam (52), had opened the branch in April amid the lockdown, with an assumption that they would not be caught. However, the branch came under the radar when an SBI customer enquired about the newly-opened branch in North Bazaar with the manager of an existing branch in the town.
After one of the customers showed the receipt he had acquired from the duplicate branch, the manager and other officials visited the fake branch and were shocked to find the set up similar to that of an original bank branch with all the necessary items. They immediately lodged a complaint with the Panruti police following which the trio were arredt under sections 473, 469, 484, 109 of the Indian Penal Code. Speaking to, Panurti Inspector Ambedkar said Babu had learnt all the bank operations in his early years and therefore, attempted to open a fake branch.

“Babu’s parents are former SBI bank employees. From an early age, he had been visiting the bank and had learnt how a branch functions. His father died a few years ago and his mother had retired. After his father’s death, he had applied for his post. He got frustrated after his application was delayed and hence decided to open a bank by himself,” the official said.  He added: “Till date, we haven’t received any complaints from customers that they have lost money in this branch. When we enquired, Babu said he never intended to cheat people but wanted to open a bank for himself. However, there has been a lot of transactions between his mother’s account and his aunt’s account. A probe is underway.”

Panruti famous for jack fruits and cashew is a small place with less than 70000 population – it is surprising that State Bank of India which officially has a branch in this place, could not locate or did not find it suspicious when a furious branch surfaced !  Some one with ingenuity had opened a Branch and had created all necessary documents and paper work including challans !! – would not any check their chequebooks and IFSC code ? or were they too created duplicate !

With regards – S. Sampathkumar

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