Case Study

Case Study

Case – 1.

Re:    Unauthorized withdrawal of Tk. 6,78,000/- from STD account of M/s XYZ by its employee.

An STD account was being operated in a Bank by two executives of XYZ Company. One employee regularly used to come to the bank with the Bank cheques, deposit slips & letters etc. as a part of his official duty of the organization. Somehow he arranged to steal two cheques from the office and withdrew Tk 6,78,000.00 from the bank counter.

Discussions:

·         What measures to be taken in making payment of cheques over the counter?

·         Responsibility of the company.

Case - 2.

Re: Fraud committed by a customer in getting SOD loan against FDR.

One customer of Bank A got SOD loan amounting Tk 4.85 crore against eight FDRs issued by another Bank B. During the issuance of the FDRs figures on the instruments were written say 500000.00 instead of 50000.00 by the bank B.

Moreover at the time of sanctioning SOD loan against the FDRS, officials of Bank A did not follow proper steps.

Discussions:

·         Who are responsible for the occurrence?

·         What will be the consequence?

·         Remedy/preventive measures.

Case – 3.

Aggressive Banking by Branch Manager by doing unauthorized transfer in some accounts.

The Branch Manager committed the irregularities by debiting to some accounts without the cheque/consent/authority of the account holders and credited the same to different CC (H), SOD (FDR), SOD (SS)  & CD accounts for showing the outstanding reduced within the approved limit at the end of the month.

Discussions:

·         When a Branch Manager commits the above nature of irregularities?

·         What is the ultimate consequence?

Case – 4.

Re: Set procedures were not followed in opening a CD account.

A CD account was opened in the Bank A in the name of M/s X. Immediate after opening of the account a sum of Tk 100,000.00 was deposited by another person from khulna through online. Bank Branch issued chequebook to the account holder and subsequently the account holder himself withdrew the amount deposited.

Later on remitter of the money lodged a case against the Manager stating that he was deceived by the account holder in connivance with the Branch Manager.

Discussions:

·         Negligence of opening of Bank Account.

·         Ultimate consequence.

Case – 5.

Re: Aggressive banking: Taking over liabilities from another bank.

Bank A sanctioned loan facilities in favour of M/s X in order to take over liabilities of the company from Bank B.

Before completion of documentation formalities Bank A allowed some loan facilities to X but thereafter taking over of the liabilities from Bank B could not be done due to some unavoidable circumstances.

Discussions:

·         What shall be the usual procedure of taking over of the other bank’s liability?

·         Consequences.

Case – 6.

The customer departed the country without adjusting a huge amount of liabilities in a bank.

Bank allowed credit facilities in favour of a Garments exporter against lien of series of Export LCs. At one stage the borrower left the country keeping the liabilities unadjusted; securities were not adequate.

Discussions:

·         Role of Branch Management

·         Responsibility of the Bank towards recovery of money from the fugitive borrowers.

Case – 7.

Syndication Loan.

M/s Y was given a loan under syndication of different banks where Bank A was the leading Bank. It is the prime duty of the associated banks to assess the feasibility of the project before sanctioning loans. Banks could not assess that properly. Loans became classified, as the project could not run smoothly.

Discussions:

·         Why the project could not run?

·         What essential factors need to be considered to assess the feasibility of a project?

Case –8.

Small and Medium Enterprise (SME) loan.

An SME loan for Tk.3.00 lakh was sanctioned to M/s X from the Bank A. At first repayment installments were maintained by the customer but it could not continue and subsequently became classified.

Discussions:

·         Objective of allowing loans under SME.

·         Suggestions.

Case – 9.

Fraudulent transaction using Debit/Credit card.

A VISA card was issued to Mr. X by the card Division of the Bank A giving a limit of Tk 3.00 lakh. Subsequently, the limit was enhanced up to 45.00 lakh.

Unauthorized withdrawal for Tk 3.00 lakh was made by some other person (Mr. Y) from different POS by capturing data of the card.

Discussions:

·         Preventive measures.

Case – 10.

Fraudulent transaction by giving false statement.

Being received an application mentioned that cheque book was lost by the account holder, a new cheque book (10 leaves) was issued and handed over by the Bank officer to the bearer of the account holder Mr. X. On the same day a cheque for Tk 2.50 lakh was placed at the counter. The same was encashed without getting any communication with Mr. X as he was not available at that time. Later Mr. X complained that no cheque book was lost and no encashment was done by him.

Discussions:

·         Negligence of Branch Officials in verifying the statement of loss of cheque book.

·         Ultimate consequence.

Case – 11.

Mismatch of fund in ATM.

Mr. A, officer & cash-in-charge of a Branch of Bank X, was assigned for loading cash into ATM. He used to load cash in ATM singly. When the officer was transferred to another Branch, at the time of loading cash in ATM it was found that physically there was Tk 80,000 in the ATM while the record revealed that the amount should be Tk 2.50 lakh.

Discussions:

·         Was maintenance of cash in ATM done jointly?

·         Involvement of Card Division.

Case – 12.

Unauthorized Transactions in accounts.

Mr. A, In-charge of a Branch of Bank X, being instructed verbally transferred fund several times from CC account of one client to CC account of another client with a view to keeping the second account regular (to adjust excess over limit). Later when the branch was inspected, Mr. A collected written instructions from the client.

Discussions:

·         Were the transactions done following the Banking norms?

·         What was the ultimate consequence?