Indian banking sector is back in the news, this time for its frauds. The multi-billion rupees Punjab National Bank (PNB) – Nirav Modi fraud became the prime-time story for every news channel. We saw blame game between Congress and BJP & between the government and the central bank. The credibility of the regulator, management and audit professionals were at stake. Even though there are stringent punishments for frauds, they are all pervasive and erupt again and again. How should we tackle them? History has shown us that severe laws are made at the hindsight (i.e. after the fraud has taken place). Hence, our approach of analysing and dealing with them must change.
Fraud Triangle
Why does the fraudster (Nirav Modi) resort to unethical means at first?
What was the mechanism of fraud?
Why does the fraudster not accept the fraud?
Psychology of Fraud
Would the accused have ever thought that his act might damage the economy?
But, why should anybody aid in such an unethical act?
Couldn’t these people really see what they are doing is wrong?
Know more here.
Originally published on 8th July 2018.
