Managing fraud risk in financial systems is a critical task for organizations like postal services, especially when overseeing countless transactions. With the Fraud Risk Management Unit (FRMU), postal divisions ensure fraud risk is mitigated effectively, keeping the financial system safe and transparent.
The Role of Divisional Offices: Segregation and Delegation
The Divisional Office plays a key role in managing fraud alerts. Here’s a breakdown of the process:
- List A: Alerts involving only Head Offices (HOs).
- List B: Alerts involving Sub-Offices (SOs).
Both lists go to the Head Offices for verification, and the entire process should be completed within 7 days.
The Head Office’s Role: Verifying Alerts Across Scenarios
Once the alerts reach the HO, here are the verification steps taken for different types of alerts:
1. Silent Accounts
Verification includes checking the Silent Account Register, cross-referencing with KYC documents, and ensuring the procedures from Rule 63 are followed.
2. NSC/KVP Discharge
Ensure the process follows Rules 140 and 142 for National Savings Certificates (NSC) or Kisan Vikas Patra (KVP) discharge. This includes checking registers and certificates.
3. Discontinued Schemes
Make sure all closures happen at the HO and comply with Rule 132. Cross-check entries with registers to confirm accuracy.
4. Pre-mature Closure
Verify signatures, cross-reference account details using Finacle, and follow Rules 59, 59(2), and 94 for premature closures.
5. Recurring Deposit Loan
Cross-check loan disbursements with SBCO vouchers and ensure compliance with SB Order 04/2021.
6. Idle Accounts Closure
Ensure proper verification of signatures and cross-check closure vouchers against alerts.
7. Online Transactions
Alerts are verified by contacting depositors directly, ensuring genuine transactions.
Escalating Suspicious Activity
When something feels suspicious, the HO doesn’t close the case; it escalates it. In case of List A or List B alerts needing further investigation, they are reported to the Divisional Head or escalated as “Report to Investigation.”
Divisional Office’s Next Steps
The Divisional Office closes alerts flagged as ‘Genuine’ or escalates suspicious ones to the Regional FRMU.
The Role of Sub-Divisional Heads
For Sub-Offices, the Sub-Divisional Head (SDH) handles the second stage of verification, ensuring any suspicious activity is investigated and reported promptly.