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Case Study - 1
Latha
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Posted 26-05-2010Reply

Mr.'X'who was in his fifties was an officer in a leading nationalized bank with 25 years service to his credit. During this long span of service, he worked in different capacities and sections. His attitude and behaviour made him a trusted official in the organization. Having been posted in a big branch based in a large city he was not keen in getting further promotions.



On one occasion when he was working as incharge, Draft Issue section, he issued bundles of drawing books from the main stock of the security forms of the branch and kept the same in his custody in an almirah provided to him. One fine morning, he removed three drawing books out of the stock of books valued below Rs.10 thousand which he had in his own custody and kept the same at his house. He then started issuing drafts in various names from his house out of the aforesaid stolen drawing books by allotting correct branch serial numbers obtained from the branch register under his control. These drafts were deposited in different banks/branches of the same bank in different accounts opened in the names of the payees of the drafts. These accounts were introduced by the bank employees and some of them were in different representations only like 'Mr.X Sharma' ,'Mr.Y Vashist' and 'Mr.X Gaur', etc.The drafts thus deposited were presented in clearing and were passed in the normal course without any doubt or suspicion. In the evening, he would visit the concerned drawee offices and remove such paid drafts.



Having found this technique successful he tried his hand at yet another. This time he stated issuing drafts in fictitious names or in the names of his close relatives drawn on out-stations without any vouchers or deposits. After few days he would cancel the same drafts by allowing the credits to the respective account in his own branch by debiting the Head Office accounts. He continued to do this for about three months causing a loss of over Rs.7lacs to the bank!



The fraud came to the light, thanks to the presence of the mind exercised by one of the offices at another local office. He found that on the previous day also, he had paid a similar draft with just the previous leaf number than the draft presented now. In his view, it was not possible for such a big office to avoid consumption of draft leaves in this fashion. Consequently, the matter was taken up with the issuing branch. Unfortunately for Mr.X, someone else was working as incharge, draft issue section, on that day. On checking up the records, it transpired that no such draft was issued. This led to prompt investigation and detection of the whole fraud committed by Mr.X.



Questions:



1. How do you view the present fraud case - a human failure or a system failure?



2. How would you manage the situation on detection?



Please help me with your valuable answers.



Regards,



Latha

Mrs
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  Rated 0 | Posted 20-07-2010

as i understood , I've not deep into that accounts as i understood its system failure by human



manage that situation is very easy

Manish
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  Rated 0 | Posted 06-08-2010

Dear Latha,

As an Hr Mgr it is simple to observe that it is system failure and that needs to be imm. repaired and including FIR must be filled imm alongwith suspension orders till domestic enquiry finishes. Thsi is serious case and need to be taken care off thr' legal manner only.

Regards

Manish Gupta
09872303387

Amita
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  Rated 0 | Posted 22-10-2010

No doubt the investigation should carried out and manager should take necessary legal action against this person. But at the same time the HR head should try to find out "why people do such kind of things?"
If a person is working in your organization for last 25 years and is one of the trusted officer, than why he changed suddenly...there must be sohme reason for his changed behaviour. He is in need of money on urgent basis for some personal reason. It is also possible that initially he was honest but later on he feels that there is no appreciation in his organization for his honest behaviour. He may be influenced by dishonest people in organization. HR head should find out the real reason for this.
I think Honest Communication and job rotations can solve such problems to some extent... Thank you

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