Definition of Bank fraud
Banks are the engines that drive the operations in the financial sector, which is vital for the economy. With the nationalization of banks in 1969, they have also emerged as engines of social change. After independence, the banks have gone through three stages. They went from the lending character based on ideology based lending to today competitiveness loans based policies in the context of India’s economic liberalization and the bonding process with the global economy .
While the bank’s operations have become increasingly significant banking frauds in banks are also increasing and fraudsters are becoming more sophisticated and ingenious. In order to keep pace with the changing times, the banking sector has diversified business collector himself. And the old philosophy of class banking has been replaced by mass bank. The challenge in the management of social responsibility with economic viability has increased.
Fraud is defined as “any behavior by which a person intends to acquire an unfair advantage over another.” In other words, fraud is an act or omission that is intended to cause wrongful gain one person and unlawful loss to another, either through concealment of facts or otherwise.
Fraud is defined u / s 421 of the Indian Penal Code and u / s 17 of the Indian Contract Act. Thus, the essential elements of fraud are:
1. There must be a representation and assertion;
2. It must relate to a fact;
3. It must be with the knowledge that it is false or without belief in its truth and
4. Must induce another to act on the claim in question or to do or not to do some act.