HR departments targeted in 600k scam

The transfer of any money or sensitive information to an unintended third party is an HR nightmare. If confidential data regarding the company’s financial status gets into the wrong hands, it could compromise employee welfare and damage corporate reputation.

Yet, the Canadian city of Saskatoon has been the victim of a massive scam targeted at HR and finance departments, according to reports released by Global News. A media conference held last week by City Manager Jeff Jorgenson confirmed that a currently unknown fraudster had targeted HR and finance departments whilst electronically impersonating the chief financial officer of a ‘prominent’ local construction company.

The fraudster then convinced HR and financial departments that the financial details of the company had changed, meaning that upon the next payment, compensation in excess of £600,000 ($1.04million) was transferred to a criminally-owned bank account.

The city complied with the request and as a result, the next contract payment intended to go to that company, approximately £600,000 ($1.04million), was transferred to the fraudster’s bank account,” Jorgenson told the press.

We have no reason to believe that the (construction) company, that this is propagated past the city, we believe that the name used is targeted at the city what this was about was effectively identity theft of a real person from an outside agency, the fraudster, so their impersonation of a CFO led to this,” Jorgenson added.

The city notified its internal auditor, the Saskatoon Police Service (SPS) and other authorities including its banking partners after discovering the scam on August 12 2019, yet whilst the SPS issued a public advisory, similar cases have been reported in the area.

It’s very similar, an identity theft type of fraud scheme. In this case, it was involving the company’s financial information and I think, in addition to that concern, police have also issued statements on … people impersonating employees and electronically asking for the banking information change and the employees’ paycheque goes to the wrong account,” Jorgenson said.

A number of companies and municipalities are getting targeted, for sure. We’re doing everything we can to recover as much funding as we possibly can we’re chasing down every lead, cautiously optimistic that we will be able to recover a significant portion of the funds but it’s early days.”

Unfortunately, such scams are far more common in the HR sector; research conducted by Lloyds Bank in 2018 revealed that HR was ranked as the second (17.2%) most vulnerable sector for falling victim to impersonation scams. The legal sector ranked top (18.8%) with IT and telecoms at 17% and finance at 15.9%.

These scams have transcended into more than half a million businesses being targeted by bogus bosses and impersonation scammers, in a bid to con naive entrepreneurs out of money.

‘Fake boss’ scam rates have rocketed with 53% of survey respondents falling victim to scam bosses, while 52% admitted receiving fake invoices from fraudsters who operated as legitimate suppliers. This is a 58% rise in this type of crime in the year, though the report concluded that this is only based on the number of reported crimes and there are likely to be more scams that have gone under the radar.

This impersonation fraud has transcended into small and medium businesses who are losing out on an average £27,000 to scammers.

Gareth Oakley, Managing Director of Business Banking at Lloyds Bank, said the damaged caused by such an attack can be devastating. “The rise of impersonation fraud is very concerning issue for small and medium-sized businesses," he said. "We know that falling victim to these types of scam can be serious as the impact extends beyond just the financial implications."

PMB (Punjab & Maharashtra Cooperative) BANK SCAM

Hello, this is my second blog which describes about how bank manipulate books and do a scam at such a large scale.

 About the Punjab & Maharashtra Cooperative (PMC) Bank

This bank was established on February 13, 1984, as a single branch Cooperative Bank. Punjab & Maharashtra Cooperative (PMC) Bank is a Scheduled Urban Co-operative Bank with its area of operation in the States of Maharashtra, Gujarat, Delhi, Goa, Karnataka, Madhya Pradesh, and Andhra Pradesh.

The commencement of the banking business of PMC took place on February 13, 1984. It operated nicely and within a time of 35 years, the Bank has a wide network of 137 branches across six states.

PMC has 1814 number of employees and now this bank stands among the top 10 co-operative banks of the country.

PMC was a cooperative bank but in 2000 it got the status of Schedule Commercial Bank by the Reserve Bank of India. PMC is the youngest bank to achieve the ‘Scheduled Bank’ status.

 THE SCAM

PMC bank exemplifies the extreme rot that exists in our banking system & regulations. On one hand it is quite understandable that few banks will mis-behave due to political influence. What surprises however is the lax regulatory oversight on the books & systemic sabotage of the accounting norms. By the end of this article, you should be convinced why you can’t trust any co-operative bank in India.

What is wrong with the above metrics? Don’t overthink. They’re all fine. Indicate a good healthy bank. The NPAs at 3.76% are high but certainly manageable. And the bank is still profitable, at-least on paper.

Look at what the banks writes in the annual report about its advances & credit policies:

ADVANCES: Your Bank’s total Advances for the financial year 2018 -19 is ` 8383.33 crore, indicating a net increase of 12.86% i.e. 955.25 crore on previous financial year 2017-18. Your Bank has shifted its focus to priority sector advances i.e. MSME advances to be in line with the regulatory requirements of Reserve Bank of India. Your Bank has also focused on different lending strategies according to the MSME lending rules so that the priority sector portfolio is increased. Further, your Bank has revised rate of interest on priority sector advances during the financial year 2018-19.

The crux of this bank fraud is that the higher management of the PMC bank has given huge loan to the Housing Development and Infrastructure Ltd (HDIL) and its group entities. This fraud case is related to the transfer of 70% of the total credit facilities of the PMC bank to HDIL and its associated companies. If we talk about the total amount of the bank fraud then it was Rs 4,355 cr. Now the total NPA of the bank has grown to 73%.

The PMC bank allegedly favoured to the promoters of Housing Development and Infrastructure Ltd (HDIL) and allowed them to operate password-protected ‘masked accounts’.

It is found that around 21,049 bank accounts were opened by bogus names to conceal 44 loan accounts. The bank's software was also tampered to conceal these loan accounts.

This bank fraud case is busted by a bunch of women employees of the credit department of the PMC bank. These employees told to the RBI that they were aware of the ghost accounts. When this case came in the light; then customers of the PMC bank rushed to the PMC bank to withdraw their hard-earned money but they were refused to give their deposited money and withdrawal limit is set by the bank.

Now the Enforcement Directorate (ED) has sealed the assets of Rs 3,500 cr of the HDIL group and the HDIL chief Rakesh Wadhawan and his son Sarang Wadhawan have been arrested by the Mumbai Police.

My advice to all readers is this.

Please stay away from the lure of additional interest from co-operative banks. This will not end well. All banks are not equal. And those with politicians as chairmen are certainly not. Park your funds only with scheduled commercial banks only. Because if you chase the extra 1% interest & lose money, some dirt will also come on you. You are not being smart here. It indicates that while you see the returns, you don’t quite understand the risk.

Unethical Practices:-

Toothless Pharma codes

Welcome back readers, I am back with a latest news. This news is related to pharmaceutical companies, their marketing and it's affects. So, I will provide the entire news and my take on it. Let's go.

These Pharma companies despite several instances of breach of the voluntary Uniform Code of Pharmaceutica
 Marketing Practices (UCPMP) by pharma companies, and the demand from the Indian Medical Association (IMA) and doctors to make it mandatory, the Department of Pharmaceuticals (DoP), which comes under the Ministry of Chemicals and Fertilizers, has yet again “requested companies to abide by UCPMP” in a written communication on February 4  after the announcement of two more planned events.
In its letter, the Department has noted that it has “received a grievance alleging that pharma companies arrange hotels, accommodation in five star hotels, local sight-seeing, etc. in conferences conducted by doctors. Similar annual national conference of Indian Psychiatric Society 2020 will be conducted in Kolkata and in 2021 at Vishakhapatnam”.

Despite receiving several statements from the UCPMP, many of the pharmaceutical companies didn't step out of unethical marketing. 
These companies are using doctors and some third parties for marketing it's medicines and then they are paying commissions and other kind of payments to the doctors and all those associated with them.
Money being transferred in huge amounts to many accounts via pharma companies. To catch these, the necessary actions must be taken.

The DoP should immediately implement a mandatory mechanism for company disclosures of payments towards doctors and professional bodies, including via third parties. The disclosures, which should be made at intervals and put in the public domain, should include the amount spent, individual or entity to which payment was made, and the reason for payment, including any services rendered.

So, I want to conclude by saying that all the pharmaceutical companies must work in a professional manner and shouldn't make money as their one and only aim. Government must also take required steps towards creating a healthy market. People's lives must not be a business for any company.

Thank you so much for reading.