ICICI Bank branch manager withdrew money from deposits for years to meet business targets: Report

A branch manager of ICICI Bank, along with his aides, withdrew crores of rupees from unsuspecting customers' accounts in order to meet business targets. The withdrawal was made to create an illusion of opening new fixed deposit accounts, current and savings bank accounts, reported The Economic Times.

The matter turned worse when someone got a whiff of it and started blackmailing the officials. Hence, this withdrawal of money from the accounts continued and the money was used to pay the Udaipur-based individual as hush money so that the whole act can be kept under wraps, said the report.

Entry and reverse entry

This act of withdrawal of money and creating new accounts is known as ‘entry and reverse entry’ in the parlance of accounting and banking. 

Under this, bank officials were creating overdrafts against FDs and using the money from the overdraft to open new current accounts, savings accounts and FD accounts. After a few days, the newly created accounts would be closed, and the money was routed back to the source bank accounts, it said.

The bank manager was running this scam for quite some time and no proper records were maintained. The branch employees were matching and reversing the transactions without any knowledge about the scam being run, as per the report.

This anomaly continued for a number of years. To date, over ₹2.5 crore has been paid as hush money to the Udaipur-based individual who was blackmailing the manager, Rajasthan Police officials confirmed, reported ET.

An ICICI Bank spokesperson was quoted in this media report as saying, “There will be no financial loss to genuine customers. Further, the employee, who was prima facie involved, has been suspended pending further investigation. We have also filed a complaint with police and are co-operating in their investigation.”

To date, special investigation team (SIT) formed on Feb 7, 2024 has frozen 62 bank accounts used for the scam which had a balance of ₹62.71 lakh. The team also found and seized ₹46 lakh in cash, it added.