`400cr fraud detected at Citibank

New Delhi, Dec. 28: A big banking fraud was uncovered at the Gurgaon branch of Citibank that saw a bank employee fraudulently diverting an estimated `400 crore from 20 accounts of high-networth clients. Citibank has already lodged an FIR and commenced internal investigation into the fraud.

“We recently initiated an investigation into a certain set of suspicious transactions based on documents forged by an employee involving a few accounts in our Gurgaon branch,” a Citi India spokesperson said in a statement.

According to sources, an employee, Shivaraj Puri used to seek deposits from high-networth customers in lucrative schemes. However, he used to transfer the funds to some other accounts. Funds amounting to `400 crore belonging to about 20 customers, according to sources, was transferred to fictitious accounts.

The employee involved is suspected of selling investment products to clients claiming that these would generate unusually high returns. It has been alleged that the employee also showed a forged notification of market regulator Securities and Exchange Board of India (Sebi) for garnering funds from customers.

The employee also claimed that the products were authorised by the bank’s investment product committee. “We immediately reported the matter to all the relevant regulatory and law enforcement authorities. Identified suspicious transactions have been isolated and we are providing full assistance to the authorities in their investigations,” the spokesperson said.

This issue does not impact other accounts, transactions or customers of the bank. Subsequent to the complaint naming the involved employee and other external individuals who appear to be perpetrators in these suspicious transactions, the police has registered an FIR, the spokesperson added.

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