Review of literature

Irregularities in banking systems is a well-researched area. Frauds in banking are as old as the banking
system itself. Therefore, a large number of literatures are available on these topics. In this section, were view
the relevant topics which are associated the recent scams and frauds in Indian banking. The aim of this study
is to empirically examine the economic impact of this Regulation on Indian stock market. The results
provide evidence of significant reduction in beta of the experimental group, where beta is used as surrogate
for cost of equity capital. The result is consistent with the notion that increased information and better
corporate governance mechanism reduces the cost of equity capital of these companies.

Bansal & Sharma (2008) present the main achievements and challenges faced in the Indian banks. This
work addresses the major achievements of the Indian banking system in the recent years. The national monetary
policies and their implementation is a complex process in a large country like India. However, effective banking
system of the country plays a main role in its implementation. The reforms in the financial sectors are carried
through the banking system. In the past the Indian banking system has gone through a lot of challenging phases.
Starting from the fund crunches to scans and frauds are always very tough for the banks to carry on healthy banking
practices. New cases of frauds and scams keep emerging in different forms. Therefore, for every financial
organization it is always a challenge to keep the track straight and clean.

Buckley (2011) presents the fundamentals of financial crisis and their effects on the economy and businesses.
This text analyses the causes and contexts in which normally the financial crisis are originated. It presents several
common contexts in which the main financial crises in the past have started. Overall consequences of the financial
crises too have been analyzed in this work. The effects on the nations, businesses and the financial organizations
themselves have been studied.Banking and commerce go together andthey are complementary to each
other.However,the problems of banking come from its links with the commercial segments.

Blum et al. (1999) addressed the modern day money laundering in different countries. This work wentthrough
the anatomy of the frauds happening in the large scale in which the money transfer is notlimited to a single country
rather it is an international affair. These scams and frauds are directlymotivated by the existing financial tax heavens.
These financial heavens are the countries that do nottax on the money deposited in their banks. Rather they
facilitate secrecy to maintain the anonymity ofthe depositor. Most of the large scale money laundering cases end up
in the financial heavens. Thiswork rightly pointed out that the financial heavens attract the illegal money to be
deposited in the banks of financial heaven countries. This is perfectly matched by the secret banking provided in
thesecountries. That is how the money laundered in several developing countries finds its safe passage tothe secret
banks in the financial heavens. These frauds can be stopped through internationalcollaboration. This is a complex
process but not an impossible task.

Bhasin (2015) studied the frauds and scams in the Indian banking sector. This study is quite empiricalin nature and
takes the primary factors of frauds and scams into account. This work starts with thedescription of the Indian
banking sector and then shows the main aspects that tends towards the scamsand frauds. Lack of accountability
among the staff mainly at the top level is one of the prime reasons behind the frauds. Ethics are often bypassed
through the loopholes in the system. Majorit y of thefrauds are done in association of the bank officials. Then cover
ups are placed at the appropriate levelsto avoid the detection. In this study the author goes in to the depth of the
fraudulent nexus between theofficial and the fraudsters. The process of the scam takes different lengths of times
depending on thesystemandthemechanisminplace

Khanna & Arora (2009), investigates the main causes of the frauds and scams. In this work, theauthors have found
some common reasons behind several frauds in the banking sectors of India in therecent years.They analyzed the
causes and contextsofthemajorscams and frauds unearthedintherecent past and looked for their root causes. Their
finding shows several reasons why the scams andfrauds happened. In the second part, they looked for the preventive
measure possible to avoid thesescams and frauds. Finally, they suggested some preventive solutions for the common
scams in theIndian banking sectors.

Irfana & Raghurama (2013) went through the online banking awareness of the customers in India.They went through
the changing scenarios in the Indian context and did a study of the uses of mobileand Internet for banking purposes.
They found that the knowledge of Indian costumers in the online transactions has been changed to a large extent.
However, there is still a big gap between therecommended level of skills and knowledge required and the current
level of preparedness in theonline customers. Barathi Kamath (2009) investigates the intellectual capital
performances in the Indian banking sector.In this work the intellectual capitals in the banking sector are identified
and their performances have been evaluated. This work deals with the identification of frauds and scams using
several intellectualaspects in the banking. It also classifies the risky and non-risky investments. That is a way to
separatethe challenges and to focus them with priority.

Mohapatra & Jha (2018) studied the recapitalization cases in the Indian banking systems. In theirstudy they found
that in the Indian context there are several loopholes exist as far as recapitalization isconcerned.In thisregardenough
is not beingdonewithbythe banksorthe policy makers.They havecriticised the policy gaps are mainly due to the
improper policy framing in the financial sectors