The Hindu : Front Page : 400-crore bank fraud uncovered

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Wednesday, Dec 29, 2010
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400-crore bank fraud uncovered

New Delhi: A huge banking fraud has been uncovered at the Gurgaon branch of Citibank that saw a bank employee fraudulently diverting an estimated Rs.400 crore from 20 accounts of high-networth clients. Citibank has already lodged an FIR with the police and begun internal investigation into the fraud.

“We recently initiated an investigation into a certain set of suspicious transactions based on documents forged by an employee involving a few accounts in our Gurgaon branch,” a Citi India spokesperson said in a statement on Tuesday. According to sources, an employee, Shivaraj Puri, used to seek deposits from high-networth customers in lucrative schemes. However, he used to transfer the funds to some other accounts.

Funds amounting to Rs.400 crore belonging to about 20 customers, according to sources, were transferred to fictitious accounts.

The employee involved is suspected of selling investment products to clients claiming that these would generate unusually high returns.

It has been alleged that the employee also showed a forged notification of market regulator SEBI for garnering funds from customers.

The employee also claimed that the products were authorised by the bank's investment product committee.

“We immediately reported the matter to all relevant regulatory and law enforcement authorities. Identified suspicious transactions have been isolated and we are providing full assistance to the authorities in their investigations,” said the Citi spokesperson.

- PTI

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