Dear Sir / Madam
Fraud Vulnerability Index (VINFRA) of Banks
The rising incidence of frauds in RFIs is a matter of serious concern. NABARD has been advising banks from time to time on Fraud Management, the Controls and Systems to be put in place to prevent frauds as well as protocol to deal with frauds. The primary responsibility to contain frauds lies with the concerned banks.
2. Consequent to our studies conducted Pan India on the Implementation of Fraud Monitoring Guidelines by the Rural Financial Institutions and presentation made to the Board of Supervision, an Index called Fraud Vulnerability Index (VINFRA) of Banks to measure adherence to fraud management guidelines has been prepared to sensitise the banks on their vulnerability to such incidents.
3. This index attempts to capture policies, their implementation, control, systems and problem indicators being implemented by the banks all of which have bearing on the likelihood of frauds happening in the bank.
4. This indicator is being published as one of the statutory inspection statements in the inspection module/OSS annual return. Upon furnishing data in this return in ENSURE, it would throw up an assessment which the Top Management may use as self- assessment tool to evaluate the banks’ fraud prevention mechanism and to take appropriate action deemed fit by the Management. Banks are hereby advised to place this feedback before their Audit Committee and Board for further internal guidance and necessary action.
5. Please acknowledge receipt.
Chief General Manager