Short Essay on Bank Fraud – Fraud, generally speaking, is an act committed with an intention to deceive in order to gain undue advantage of someone.
In order for it to be fraud in the legal sense the person on whom the fraud was sought to be committed should have necessarily fallen prey to it. If an attempt of fraud is made but the person concerned was not actually deceived, it is not ‘fraud’ as understood legally.
Bank fraud is a fraud committed on banks mainly by fraudulent representations using false documents. Bank fraud concerns all citizens. It is a very sensitive issue as it affects the public faith on which the whole Banking system is pre-dominantly based.
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Bank fraud includes all sorts of misappropriations, embezzlements, manipulations of negotiable instruments like cheques, bank drafts, bills or statements of accounts, securities etc. With the boom in banking business, bank frauds are also on the rise. Bank fraud is covered under Indian Penal Code. Cheques are a major area where frauds are committed by putting counterfeit signature on the cheque.
This is probably the most common bank fraud committed. Another kind of fraud is the hypothecation fraud, wherein money is fraudulently obtained against some kind of security. A fair economic system requires a fair financial system with public confidence bestowed on it. Several preventive measures can be taken to avoid it e.g., Right recruitment, Eternal alertness, adherence to rules, training courses etc.