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Raghavender (Software Consultant)     01 April 2018

Bank fraud at drt by tampering int rate in loan agreement

Irrefutable evidence of fradulent tampering of loan agreement ( 'additional int rate' ) by bank at DRT for wrongful gain around 9 lakhs is available. I believe DRT and Consumer Forum is not the correct forum to prosecute the bank. What is the correct procedure and right forum to initiate proceedings against the bank ?



 14 Replies

Kapil Chandna (Lawyer at Supreme Court of India)     01 April 2018

Sir, 

 

Approach the Hon'ble High Court in Writ and agitate the issue there ... 

 

Warm Regards 

Kapil Chandna Advocate 

9899011450,9911218741 

www.kapilchandna.legal 

Sandeep Jain (Advocate)     02 April 2018

Since the fraud has been committed in DRT, the best would be to file appropriate application before DRT, alone otherwise all the relevant documents establishing the fraud. Only if DRT refuses, then approach the higher forum.

Thanks

Sandeep Jain
Advocate

9911172271,

sjain_adv@yahoo.com

G.L.N. Prasad (Retired employee.)     02 April 2018

Seeking certified copies of such documents under RTI, getting such alterations confirmed by Truth Labs, and approaching to Banking Ombudsman are cost effective remedies. (I am afraid that they may not be fraudulent tamperings but may be corrections and no bank officer takes that risk on himself)

Raghavender (Software Consultant)     02 April 2018

I have rebutted the exaggerated fradulent claim in DRT but DRT actually returned an IA seeking prosecution of the bank.  The bank indulged in tampering of loan agreement on the page mentioning various interest rates. Certified copies from State Consumer Commission, National Consumer Commmission and DRT are available proving the fact. Although bank's debt claim is being contested at DRT, I would like to initiate prosecution of the bank. I was asked to file an FIR first by one official, which I shall do it but then petition which Court ?

 

ADVOCATE TRILOK (CRIMINAL family PROPERTY topfreind@gmail.com )     02 April 2018

You are a defendent and /or debtor so no court gives importance to such flaws.

 

And it is double whammy that you admit part of the loan so pay up first what is due as per you and fight for the balance extra charged on you.

MOST  IMP  TACTICS WHICH IS TIME CONSUMING AND COSTLY IS TO SEEK FOR CANCELLATION OF THE PARTICULAR DOCUMENT WHICH YOU FEEL IS CORRECTED.

G.L.N. Prasad (Retired employee.)     02 April 2018

There may be modifications/corrections/ or alterations, which lack authorisation but whether they are malafide material alterations or not is the issue. 

To allege the Bank officials of tampering and lodging a complaint with Police, you may not get the motives, as individuals  may not get any personal benefit out of this corrections. What ever you pay goes to the Bank and not to accounts of individual official that altered the interest rate.  Bank has to charge the sanctioned interest and some times, there may be error in entering the correct rate of interest (The confusion is on over RBI rate or Prime Lending rate).  But that simple error can not be the reason for your default.  Before approaching court, the fundamental is that one should approach with clean hands.  A defaulter of public funds can not be with clean hands as per earlier court judgments. 

Showing a mistake and then arguing that is the reason for your account becoming default is not corect.  You may calculate your own interest , pay such amount and then approach court that you have paid the amount as per your calculations and you are not a wilful defaulter and it is the Bank that dragged you to court.

To my knowledge, the courts were never kind to defaulters as the practice is to get benefit from the bank, and instead of repaying the debt, making counter allegations against the bank, showing the reasons for default is known to them.

Raghavender (Software Consultant)     02 April 2018

I appreciate expert comments. I did not and cannot put all the pertinent facts of the case on this post. All I can say is, loan was wrongly classified NPA and perfidiously recalled preempting reconciliation while withdrawing facility of payment in installments. District Consumer Forum deemed it unfair trade pra actice and State Commission dismissed bank's appeal first for default but upon revision petition, the consumer case has been set aside with liberty granted to me to approach appropriate forum to seek remedy, as the matter reached DRT. I AM YET TO SEE THE ENTIRE ORDER. It is not the interest rate charged on principal that is tampered. They have simply entered additional interest rate of 24% pa in the blank against it to illegally charge on alleged non-payments while debt recovery is itself time barred.

The bank official developed extraneous interests in collusion with other elements and potential bidders and is likely to benefit monetarily from auction sale. Therefore, the wrongful exaggeration of their debt claim.

I hope, I am more clear now.

G.L.N. Prasad (Retired employee.)     02 April 2018

But, no single official can be responsible for such decision.  The audit comments, RBI comments, internal inspectors comments, the opinion of superiors and a decision to file DRT and legal opinion etc are the process involved in going before DRT.  I have never heard any bank disclosing NPA on their own, infact they suppress and cover to show it as Standard Asset always, unless they are bound to.  Increase in NPA, reducing revenue of interest income reduce the rating of branch and individual employee.

Raghavender (Software Consultant)     02 April 2018

For violating RBI Guidelines, Sec.46(5) of Banking Regulation Act holds person in charge at the time responsible. Can't Legal Officer who signed verfification of application on behalf of bank held responsible? If not, doesn't this give an organization liberty to committ default without culpability? I am told that I must lodge and FIR mentioning Regional Divisional Manager and Head office Chief Manager. Please comment. Thanks.

Raghavender (Software Consultant)     02 April 2018

DRT Registry refused to take IA seeking leave for prosecution on file citing lack of jurisdiction for fraud

G.L.N. Prasad (Retired employee.)     02 April 2018

Sorry, I am not an expert ?

What ever remedy you expect from Bank out of such mistake can be negotiated with them,

But, I still fail to understand the exact link between such interest and reasons for default.

A prudent borrower, wih a capacity to repay the amount, first pays the demanded amount under protest and then file case for fraud or such other thing which he may like against the Bank.

Except satisfying ego, by spending more amounts on vexatious litigation at the end you are not going to achieve out of such alteration in rate of interest.  

,

Raghavender (Software Consultant)     03 April 2018

Sorry, I am not an expert ?
You definetely are one and I value our discussion.
What ever remedy you expect from Bank out of such mistake can be negotiated with them,
Ex turpi causa non oritur actio - remedy cannot arise from an illegal act. Should a victim negotiate with culprit or take steps for prosecution ?
But, I still fail to understand the exact link between such interest and reasons for default.
As a borrower I see clear link as debt claim has been fradulently exaggerated through tampering. Why is it being assumed that borrower is always at default in every case before DRT? Are the banks infallible under all circumstances ?
A prudent borrower, wih a capacity to repay the amount, first pays the demanded amount under protest and then file case for fraud or such other thing which he may like against the Bank.
On similar reasoning I paid unduly enhanced EMIs and now the bank contends, I have voluntarily paid. Does the question arise -Why payment is done if there was a fraud?
Except satisfying ego, by spending more amounts on vexatious litigation at the end you are not going to achieve out of such alteration in rate of interest.
Sorry, no ego but craving for justice is involved.
 

Kolkata advocate (Advocate)     04 April 2018

If bank gives customer fraud loan repayment schedule which doesn't match loan statement...it happened two times for single loan account. Within two months bank gave two diff loan repayment schedule totally manipulating book of account... They also gave agreement where signature of bank officials is missing...so it is legally nonenforceable.. They gave fraud loan repayment schedule Two times..can a bank claim it to be legally binding on borrower... I must mention borrower has repaid total principal amount plus few lakhs as interest...can bank earn any benefit from a legally unenforceable agreement and fraud account statement? Loan agreement was executed in favor of bank where they didn't sign ..pls guide?

G.L.N. Prasad (Retired employee.)     04 April 2018

1If bank gives customer fraud loan repayment schedule which doesn't match loan statement...it happened two times for single loan account. Within two months bank gave two diff loan repayment schedule totally manipulating book of account... 

The repayment schedule once given is final and a borrower can always seek that certified copy of sanction letter issued at any time under RTI and under CP Act.  Further, Bank has to record the sanctions in books of accounts and also inform the same to higher authorities.  Hence there can not be any discrepancy.

However, if correct rate of interest is not calculated for EMI fixing (error) there may be some errors in EMI.(These are clerical errors in not feeding into the system correct no of instalments , or period or principal or rate of interest.

This is not manipulative, but only correcting the mistake.  The Bank is bound to intimate the error,  express regret for the previous lapse and request them to take second one as authentic.
 

They also gave agreement where signature of bank officials is missing...so it is legally nonenforceable.. 

Customer can insist for certified copy of Agreement available in record with official signature as certified copy under RTI Act.  Normally, the sanctioning authority contributes signatures after obtaining all documents and only after verification.  He can only sign only after verification, once they are signed the documents are kept under double lock and key.  If agreement is in dispute the forum must accept the agreement with  signatures of borrower as it can not be created by borrower himself, as handwriting is with Bank employee.  The presumption in case of all bank forms is that officials sign finally.

They gave fraud loan repayment schedule Two times..can a bank claim it to be legally binding on borrower.

The sanction terms and conditions should be informed to borrower with his signatures.  How many times it is given is not the issue, the acknowledgment and information to borrower is the deciding point.

 

I must mention borrower has repaid total principal amount plus few lakhs as interest...can bank earn any benefit from a legally unenforceable agreement and fraud account statement? Loan agreement was executed in favor of bank where they didn't sign ..pls guide?

If the Borrower has repaid entire principle and atleast Prime Lending rate, the dispute with the borrower is genuine and borrower is sincere.   DRT, consumer forum, Banking Ombudsman, Court and RBI should admit in the first sentence of their decision that the borrower is sincere and repaid the principal and PLR and the dispute is only on charging interest.

Whether the interest charged by the bank is correct or not can be verified in many ways.  For eample if a loan of Rs.20/- lakhs was sanctioned as Home loan on 3-4-18, the rate of interest applied for all loans sanctioned in entire country must be uniform and as per circular issued showing RBI Rate, Prime Lending Rate and the percentage of interest over such rates charged by the Bank.  If the borrower has a doubt that excess interest was charged, he has a right to seek such certified copy of circular on lending rates prescribed by the bank through circular on that date and if the bank charged over and above the rates, it amounts to misrepresentation.  If such errror is not rectified they it becomes a criminal offence as knowingly that it is not correct, they have charged interest against the norms fixed by the Bank.  (Generally this happens only in unsecured loans, released prior to getting sanctions.  It is possible, as many officials release the loan immediately though the sanctioned amount is not within their powers and writes for ratification of their action.  So, interest will be charged at maximum lending rate upto date of receipt of sanction and the rate of interest as per sanction has to be followed)

Agreement on record signed by both the parties are valid.  Bank always keeps that and atleast 10 officials verify that document in the first year.  Account can never become fraud.  Account statement is a copy of original account / Ledger.  If the agreed rates of interest/sanction terms are not followed, it is only a serious irregularity and can not be fraud.  A fraud is that the employee gets a personal benefit out of that transaction.  Here what ever is earned by the bank goes to the bank and not to personal account of employee.  That is the reason I have suggested you not to use fraud in case of Bank.  Fraud or criminal offence must establish unlawful gains to himself.

As repeatedly stated, I am not expert and a common man.  It is upto the member to take it or leave it  and while replying we sincerely attempt to provide guidance with bonafide knowledge.


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