Stay Safe From Banking Frauds

A- A+

In recent times, many senior citizen have fallen prey to banking frauds. Here’s a look at the precautions senior citizens can take to stay safe from banking frauds. 

2013: A former IIT Kanpur director lost Rs 19 Lakh from his bank account to online fraud. The fraudsters obtained a duplicate SIM card and blocked SMS alert to avoid suspicion.

 Nov 2015: Mumbai resident Ramesh Vora, 68, lost Rs. 35,000 after a woman called him posing as a bank official, offering to redeem reward points on his card and asking for his One Time Password (OTP).         

 Nov 2015: A man posing as a Reserve Bank of India official cons senior citizen Madhav Limaye, 72, into sharing card details on the pretext of verifying them. Mr Limaye loses almost Rs 38,000.

 Jan 2016: A senior citizen loses Rs. 50,000 after getting a fraudulent call saying his bank was upgrading his card. He trusts the caller and shares details like CVV (Card verification value) and PIN (Personal identification number).


Cyber crime is a clear and present danger in India. With the increasing use of online banking, credit and debit cards and mobile banking, many seniors are falling prey to online frauds like identity thefts, phishing (fraudsters try to phish or obtain confidential information over email, disguised as a trustworthy person or business) or voice phishing (the same trick used over the phone) as mentioned above.

According to RBI, banks incurred a loss of more than Rs 12,000 crore in 2014-15 on account of overall frauds. Between April 2011 and September 2014, banks reported 27,614 credit-card related frauds and another 3,835 debit-card related frauds. (Source: Hindustan Times) The data may not be restricted to senior citizens but as the examples above show, senior citizens remain particularly vulnerable to credit card and banking frauds.

What makes senior citizens an easy target for fraudsters? “Many seniors did not use much technology earlier and therefore face major challenges in trying to adapt to it now,” says RV Raman, former head of KPMG’s consulting practice, ex-partner with AT Kearney and Arthur Andersen and author of the corporate crime thriller Fraudster.

According to Mr Raman, fundamentally, most frauds revolve around stealing your identity. “Earlier, it was difficult to ‘steal’ your signature. It called for a level of forging skill that was not commonly found. But today, your identity can be stolen if two things are compromised – your email and your mobile phone. Once a fraudster has access to them, he can change any detail relating to your bank accounts and investments, and can empty them out. He can even have cheques issued in another name. Of course, if he could fool you into parting with your bank/investment account user id and password, his task becomes even easier,” he adds.

We spoke to Mr. Raman to find out how senior citizens can stay safe from banking frauds:

* Protect your email id and mobile number: Do not give unnecessary access to your email and your mobile phone to anyone. Raman suggests using a separate, dedicated email id for your financial matters and not mix it up with the regular email that you use to correspond with family and friends or the one you share with shops and websites. That makes the first step for the fraudster – obtaining your email id – more difficult.

* Don’t fall prey to voice phishing: When somebody from the bank or any other financial institution calls you, don’t answer his/her questions right away. Remember that when the bank calls you the onus is on them to establish identity, not on you. Instead, if you get a call asking you to provide details, ask the caller a bunch of questions to establish his/her identity, suggests Raman. Few questions could be: Which branch are you calling from? What is the address? What is the branch manager’s name? What is your designation and mobile number?

“Basically, any question you can think of that probes the caller’s identity. When you do this, the unknown caller gets increasingly uncomfortable, and often calls off,” Raman adds.

* Insist on speaking in English: Any banker who should be calling you legitimately should be able to speak well in English. If the person can’t, he/she is supposed to have an English-speaking person call you.

* Do not assume that a fraudster can only be a man. There are women fraudsters too, and in plenty.

* Do not share sensitive and confidential details such as password, CVV over email.

* Don’t EVER share your account number, PAN number, user id or credit/debit/ATM card number with a caller. Similarly, never share your passwords, OTP, PIN and CVV – a genuine banker already knows these, and does not ask for it.

* Report if in doubt: If you are doubtful about a call and fear it may be a fraudulent one, Raman suggests that you call off and contact your branch manager. Keep the phone number from which you received the suspicious call handy. Banks and financial institutions are very sensitive about financial frauds, and will respond immediately.

* Don’t fall for threats of closing your account if you do not provide the details. Financial institutions don’t do that without written notices.

* Check your account statements regularly: Report anything suspicious or unexpected, urges Raman. For instance, if your statement shows a different email id, raise the matter immediately – this may be the first step of a potential fraud.

* Don’t go dormant: Raman reiterates the dangers of letting your account become dormant. “Fraudsters working at financial institutions are always on the lookout for dormant accounts. About 90 per cent of frauds that emanate from inside, target dormant accounts and accounts where the registered mobile number and email ID are outdated. Once a crooked employee gains control of the registered email id and mobile number, he/she can do anything with the account. Since the email id and mobile number that are registered are not yours, you will have no clue that your money has been stolen.

* Update your details: Any investment made more than 10 years ago did not have PAN No., Mobile number and Email ID as mandatory requirement. About 30% of accounts have this missing. Therefore it is important for senior citizens to update such things, Raman advises.

* Be cautious with PoA: Avoid giving Power of Attorney (PoA) in generic formats. Make sure the PoA is limited to three dimensions: a)The time period for which the PoA is valid; b)The purpose for which the PoA is issued. You can be as specific as you want, and name the asset of the account to which the POA is applicable; c) The person(s) who can use the PoA. Remember, unless a PoA is specifically limited to a certain period of time, it can be used for ever, cautions Raman. “Even when the issuer dies or is laid up, it can be misused. The financial institution cannot check with the issuer each time a PoA is used.”

If you have mistakenly given out your personal details and/or feel your account is compromised in any way, inform your bank immediately. Block any card that may have been misused. Stay informed and aware and you can stay safe from banking frauds.

— RV Raman spoke to Reshmi Chakraborty

About Author

Silver Talkies

Silver Talkies is a multi-dimensional platform for people over 60. Our team brings you features that highlight people, passions, trends, issues, opinions and solutions for the senior generation.