Cyber fraudsters drained out Rs 7.79 crore from Kangra Co-operative Bank’s account with regulator RBI

Dharamshala, May 25 (FN Agency) Cyber fraudsters have allegedly drained out Rs 7.79 crore from the Kangra Co-operative Bank’s current account that is maintained by the Reserve Bank of India (RBI), according to a police complaint lodged by the bank in Delhi. The fraudulent activity occurred over a span of three consecutive days, with the first transaction taking place on April 19, 2023. The baffling aspect of this cyber theft is that the bank is financially supervised by the RBI and the affected current account is itself with the regulatory authority. This has left top officials clueless as they struggle to identify the person behind the fraudulent transactions, although the Kangra bank claims to have identified the accounts where the money was transferred. A senior manager (IT) at the Kangra bank filed a complaint with the Delhi Police, resulting in the registration of an FIR in early May. The investigation is currently underway to uncover the details of the cyber fraud.

Kangra district police however said that they were unaware about the fraud as no case was registered in any of the police stations in this district. According to the complaint, the bank maintains a current account with the RBI for various banking transactions such as real-time gross settlement (RTGS), National Automated Clearing House (NACH) and National Electronic Fund Transfer (NEFT), among others, for its customers. The bank follows a process wherein a standing instruction is issued to the RBI to transfer Rs 4 crore from the current account to a settlement account every day, enabling the bank to facilitate RTGS and NACH transactions. At the end of each day or the following day, the RBI sends an email statement to the bank detailing all the transactions that occurred in the settlement account throughout the day, which is then reconciled by Kangra bank officials. The remaining amount is transferred back to the current account from the settlement account. However, on April 20, when the RBI provided the statement for the transactions conducted on April 19, Kangra bank officials noticed a discrepancy.

Approximately Rs 3.14 crore less than expected had been transferred from the settlement account to the current account. This irregularity continued for the next two days, with the current account receiving Rs 2.40 crore and Rs 2.23 crore less than the expected amounts from the settlement account. In total, the suspected fraud amounted to about Rs 7.79 crore over the three days. The bank promptly informed the departments concerned of the RBI and other financial security authorities, identifying the accounts at other banks where the fraudulent transfers occurred. However, the culprits responsible for the fraudulent transactions remain unidentified. The Delhi Police suspect cyber hacking or tampering as the individuals involved appeared to be unknown to the bank. Established in 1972, Kangra Co-operative Bank Ltd initially started as a small credit society in 1960 to provide financial assistance to the people of Himachal Pradesh residing in Delhi. With 12 branches across Delhi, the bank is one of the largest urban co-operative banks under the administrative control of the Delhi Government through the Registrar of Cooperative Societies.