Banking Frauds and how to prevent it

Banking Frauds and how to prevent it

Bank fraud refers to the illegal process of obtaining the money, assets or certain valuable properties that are owned or controlled by the financial institutions. They can also obtain money from the depositors by fraudulently acting as a bank or other financial institutions. In may cases, bank fraud had mentioned as a criminal offence.

Sometimes the bank Fraud is considered as White-collar crime because the specific elements of banking fraud totally depending on the jurisdictions the term bank fraud applies to oppose the bank robbery or theft.

Types of Bank Fraud

  • Accounting fraud
  • Demand draft fraud
  • Uninsured deposits
  • Bill discounting fraud
  • Cheque kiting, etc.

To cover the serious financial oriented problems, the certain business has kept a way to use fraudulent bookkeeping to exaggerate sales and income, increase the Worth of those company assets, or level of profit when the company is running at loss. These companies “cooked the books” to show that they had profits at each quarter, even they were mostly in debt.

Read also how to get out of Bank Debt

Demand draft (DD) Fraud refers to one or more dishonest bank employees. Those employees can steal the DD leaves or DD books from the stock and write it down as a regular DD. They are workers, so they know the coding and punching of a demand draft. Those fraudulent demand drafts were commonly drawn payable at a far city without debiting an account. The draft can be cashed at the payable branch. The fraud can find out only after six months when the headquarters did the branch wise recollection.

Certain fraudsters had combined the fraudulent card stripe readers to candidly access the ATM’s, to get unauthorized access to the information’s of that magnetic stripe. In the same way, they use hidden cameras to illegally record the user’s authorization code.

Also, check out Debit Cards vs Credit Cards

Safety protocols for preventing frauds

  • Check your account activity habitually: This the most effective way to secure your finances. You should log in and view your account details frequently.
  • Keep your pin and password secret: Don’t spread out your pins and passwords to anyone. Writing down them on papers, in email or in a text message can all be easily intercepted.
  • Use a confident password for online banking: The password with capital letters and special operators or numbers can be effective. Don’t keep the password like your birthday, kids names, your address or anything else.
  • Change passwords frequently: you must want to change your passwords periodically, this can keep your account secure.
  • Check for secure connection: you have to visit your bank’s website frequently, check your browser to verify the secure connection. The web address which are starts with https refers you should have a secure connection.
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Michael Clarke

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