Money & Banking
Lax security authentication led to card-skimming frauds, says RBI

“The problems relating to illegal card transactions happened because we are interlinked, and the two-factor authentication and the other security measures did not exist in overseas market where these cards were cloned and used,” RBI executive director G Padmanabhan said

The recent instances of illegal debit card-skimming leading to money theft from other bank accounts can be attributed to non-practice of authentication processes in the jurisdiction where the money was withdrawn, Reserve Bank of India executive director G Padmanabhan said today.


“The problems relating to illegal card transactions happened because we are interlinked, and the two-factor authentication and the other security measures did not exist in overseas market where these cards were cloned and used,” he said while speaking at an event in Mumbai.


He attributed the issue as one of the negative fallouts of an interconnected world in which one lives.


“Technology has enabled an interlinked world and payment infrastructure. While this is welcome, being able to initiate payment transaction even from top of Mt Everest, please also remember that you are as good as the weakest link,” he said.


Recently, customers of private sector banks, including Axis Bank had complained of amounts getting withdrawn in euros overseas.


In its investigation, the law enforcement agencies found out that some ATMs were allegedly compromised by fraudsters to clone the cards.


After cloning, the account details were used to withdraw money in Greece.


Most of the customers have been compensated by the banks for the money withdrawn fraudulently.


Padmanabhan also questioned why banks are not using any alternatives to the usage of the fraud-prone cards, including near failed communication and mobile-based call options to avoid such instances.


Meanwhile, he also flagged the issue of violations in the money transfer service at banks, and said employees who indulge in any violations should not be allowed to continue in service.


“I don't know if crores of money have come out. But why people who dealt with these kind of transactions remain in the system?” he said.




4 years ago

Respected sir,
I am suffer that this fraudulent someone hack my sbi debit card no and do illegal online purchasing on 29/6/2013 worth rs49980 hacker will do five transaction rs 9994,9995,9996,9997 &9998 i complained to sbi bank and also complained to cybre crime cell am very dissapointed and very sad :( please help me sir..

Saurabh Srivastava


4 years ago

Why the average customers are put under pressure to subscribe such technological facilities, which are yet to be tested foolproof? The Banks are pushing aggressively such techsavy products even to rural mass who are novice to mobiles.

To make role model to the customers, my Bank first made it compulsory to its employees 5 years back and my AGM sarcastically asked how many crores will be there in my account, on my refusal to subscribe. Then I replied, the meagre monthly salary is crore worth for me.

India says no to asylum request by Edward Snowden

Snowden who leaked details of top-secret American mass surveillance programs, is currently in Russia

As expected, the Indian government on Tuesday rejected a request for asylum by US whistle-blower Edward Snowden. Snowden, who is on the run had made the request through the Indian Mission in Moscow three days ago.


A spokesperson in the external affairs ministry said, “I can confirm that earlier today our Embassy in Moscow did receive a communication dated 30 June from Mr Edward Snowden. That communication did contain a request for asylum. We have carefully examined the request. Following that examination we have concluded that we see no reason to accede to the request”.


Snowden, a US former technical contractor for the National Security Agency (NSA) and Central Intelligence Agency (CIA) employee who leaked details of top-secret American mass surveillance programs, is currently in Russia.


Interestingly, WikiLeaks founder Julian Assange had last month claimed that he had sought asylum in India through its mission in the UK. However, external affairs ministry had denied receiving any such request.


Snowden is charged with violating American espionage laws.


His leaks revealed that the US intelligence used a secret data-mining programme to monitor worldwide internet data to spy on various countries, including India.


Economy & Nation Exclusive
Jet-Etihad deal: What happened in those 48-hours?

On 22nd April the Cabinet Committee approved 40,000 additional bilateral seat rights per week to Abu Dhabi. As soon as the bilateral deal was signed, both Jet and Etihad entered into an agreement on 24th April. Is it a coincidence or collusion?

The deal between Naresh Goyal-led Jet Airways and Etihad Airways, the national airline of the United Arab Emirates (UAE) is becoming controversial day by day. According to new information, not only the Director General of Civil Aviation (DGCA) but the Cabinet Committee also played a significant role that benefitted both Etihad and Goyal. While defending the deal on Tuesday, Ajit Singh, minister for civil aviation, said this (Jet-Etihad) was an important deal and those opposing it are long on politics and short on facts.


In a release issued today, the Prime Minister's Office (PMO) said, "There is absolutely no disagreement within the government or between the Ministers and Prime Minister on the matter. The Prime Minister is neither washing his hands off the Bilateral Air Services Agreement nor is the Prime Minister's Office trying to do a U-turn on the issue now."

According to the note issued by the PMO on 13 June 2013 and the minutes of a meeting by P Chidambaram, the finance minister (FM), it has now come to light that all major decisions regarding enhancing the seats and Jet-Etihad deal were taken during the 48 hours between 22nd April and 24th April 2013.


On 22nd April “under the direction of the Prime Minister” the Cabinet Committee approved the signing of the grant of 40,000 additional bilateral seat rights per week to Abu Dhabi, and less than 48 hours later on the 24th of April the bilateral agreement was signed between the two governments. On the same day, 24th April, the announcement and signing of the Etihad-Jet Airways deal was made. Is this merely a coincidence or collusion that facilitated the deal?


What is shocking are the notes from the PM and the FM (copies of which are with Moneylife) contradict each other. The minutes of the meeting held on 22nd April 2013 and signed by P Chidambaram states that the bilateral was mandated under the directions of the PM. However, the note from the PMO says that the PM was concerned with the proposals being made for the bilateral deal with Abu Dhabi. The note also clearly states “the decisions were not taken under the direction of the Prime Minister”. The question then is who is telling the truth?


Earlier, an inter-ministerial group (IMG) had raised objections to the bilateral deal to be entered with Abu Dhabi. However, soon after the IMG meeting, Ajit Singh, the minister of civil aviation approached the PM urgently seeking clearance for the bilateral deal and thus override the objections raised by the IMG. Singh also emphasised that a visit of an official from his ministry was scheduled and the postponement of this (visit) would send a wrong signal. Prime Minister Manmohan Singh then directed Chidambaram to hold a meeting with Ajit Singh, Anand Sharma, minister of commerce and industries and Salman Khurshid, minister of external affairs. This meeting was held on 22 April 2013 itself.


After the meeting Chidambaram and all other three ministers met the PM. The meeting was also attended by Shivshankar Menon, National Security Advisor and Pulok Chatterji, principal secretary.


During the meeting, Chidambaram briefed the PM about the agreement (between India and Abu Dhabi) reached earlier in the day for giving a mandate to the negotiating team to allow an additional entitlement of 40,000 seats per week in a phased manner over the next few years along with the third country code sharing and domestic code sharing.


The PMO raised following issues during the meeting...

1. Although ministry of external affairs and ministry of commerce support this substantial enhancement (40,000 seats per week), the Department of Economic Affairs (DEA) had reservations in the past on the enhancement.

2. It has been reported in the media that some airlines have opposed the request for enhancement.

3. It is also likely that private airport operators would not be supportive of this enhancement as they have invested substantial amounts in the airports at Delhi, Mumbai, Bangalore and Hyderabad and would like these to develop as hubs for air traffic.

4. One of the effects of this enhancement would be that long-distance traffic from India to Europe or North America would be diverted to Abu Dhabi.

5. There is a possibility that if, as reported, an Abu Dhabi airline acquires Jet Airways, this entity would control the bulk of the seats on this route.

6. There is possibility that other countries may also make similar requests.

7. Hence a calibrated approach may be necessary.


After this, Ajit Singh assured the PM that all these concerns were considered while arriving at the enhancement. “His considered view was that these concerns would not have any adverse impact on the Indian aviation sector. The minister was of the view that the additional capacity would enhance traffic to AAI airports where AAI has invested substantial funds in capacity enhancement. While allocating additional entitlements, requests of all domestic airlines would be kept in mind. The minister stated that the air traffic market was growing rapidly and there would be a need to enhance entitlements in any case. In addition, he felt that the overall context of liberalising FDI in civil aviation needed to be kept in mind. Concerns would also be addressed by phasing out the enhancement,” the note from PMO states.


Anand Sharma also mentioned attracting large volumes of FDI and FII from Abu Dhabi to India during the meeting. The note says, “His (Sharma's) view was that Abu Dhabi currently has one of the largest Sovereign Wealth Funds in the world and it is in our interest to take steps to attract these funds to India”.


“The finance minister and external affairs minister were in agreement with and endorsed the views of the other ministers. On the basis of the above, it was agreed to give an ‘in principle’ go-ahead to the negotiating team as per the formulations (40,000 seats per week),” the note says.


Prime minister Singh, then directed that the matter may be brought to the Cabinet for a decision before operationalizing any agreements that may be arrived at by the government with the other party.


However, this decision was implemented within 48 hours and on 24th April the bilateral agreement between India and Abu Dhabi was signed. Soon after signing the bilateral, the long-pending deal between Jet and Etihad was also signed on the same day.


It is therefore obvious that the consideration to be received or received by Jet Airways was clearly linked and co-related to the value of the bilateral that Abu Dhabi was receiving along with its investment in carrier. The sole beneficiary of the largesse of this bilateral deal was Naresh Goyal and Jet Airways and not India as the government wants us to believe. 


Last month, the Foreign Investment Promotion Board (FIPB) deferred a decision on the Rs2,000-crore Jet-Etihad deal, the largest foreign investment in the Indian aviation sector, and sought clarity on control and ownership. As per the proposal, Jet Airways plans to sell 24% stake to Etihad for about Rs2,058 crore.


Market regulator Securities and Exchange Board of India (SEBI) and the Competition Commission of India (CCI) have already sought clarity from the domestic carrier on the transaction, to ensure that Etihad’s ownership powers in Jet remain in line with its 24% stake in the company’s equity capital.


On 5 June 2013, Jet Airways chief executive Nikos Kardassis has resigned after a five-year stint with the carrier, and its chief operating officer Capt Hameed Ali was made the interim chief executive.


Reportedly, Etihad has been demanding a change in the management of Jet Airways, including removal of Goyal's wife from the board.


For the quarter ended March, Jet reported deeper losses at Rs495.53 crore against a net loss of Rs298.12 crore for the same period year-ago. Total income from operations declined to Rs3,922 crore in the March quarter from Rs4,041.61 crore in the year-ago period.


For the full fiscal 2012-13, the second largest airline improved its bottomline by narrowing the losses to Rs485.5 crore against a net loss of Rs1,236 crore in FY12.


Tomorrow... Objections of Parliament, SEBI and CCI to the Jet-Etihad deal

Read More

EXCLUSIVE: Jet-Etihad deal: What are the Parliamentary Standing Committee, FIPB, SEBI and CCI worried about?

EXCLUSIVE Jet-Etihad deal: Handing over benefits to Abu Dhabi on a platter





4 years ago

Its quite clear that a lot of moneypower and influence has been put to work in this deal. The speed with which Ajit Singh has brushed aside any objections to the deal clearly shows that his rate chart was seen and complied with by Jet/Etihad. How will someone get proof of something like this since funds would have easily moved into an Abu Dhabi or Dubai based bank itself.

Such insinuations will arise when ministers act in a bipartisan manner and prefer one entity to other, instead of playing by well laid out rules.

In the immediate aftermath of this, Ajit Singh initially opposed the Air Asia TATA bid to start an airline, and then turned coat.

It all points to his running this ministry as his fiefdom and potentially garnering as much funds as possible from this empire for the ensuing elections.

Dayananda Kamath k

4 years ago

we are prepared to go to any extent if foreign investment comes to india because rbi and this govt has mismanaged the forex resources. the loan repayments in foreign currency due in the next 9 months are more than the forex reserves held by india. only peoples gold can come to the rescue of the balance of payment crisis looming at us.

k k sharma

4 years ago

The speed with which the deal was signed is bound to raise doubts in people's mind. More so, as the Govt's immediate past scam report record has been rather exceptional. Matter is unlikely to die down so soon.

nagesh kini

4 years ago

The entire 'sweet heart' deal stinks to high heavens with all the dramatis personae agreeing to disagree!.ow it has the PM right in the middle with the FM putting it in a note to save his own skin. The Min. for Civil Aviation is challenging the PM saying that the PM is very wel aware of the entire matter.

Anil Agashe

4 years ago

This may be no coincidence and Etihad's investment in Jet may be subject to this deal. But then who suffers except Air India? Is AI in a position to fly additional flights on this route? If we need FDI in aviation these kind of deals may become necessary. Secondly Jet's funding is allegedly from that region itself. These rumors are there since inception of Jet. The only relevant question is did someone make money in the bargain?
If the government acted promptly and all is above the board then its a welcome sign.
However these documents getting in the hands of the press is a serious issue and will one day back fire. Times Now had the documents yesterday itself.

Praveen Mohan

4 years ago

Thanks to Dr. Subrahamanyam Swami and other whistle-blowers who have brought this scam into light...


Debashis Basu

In Reply to Praveen Mohan 4 years ago

This is exclusive from Moneylife and Swami has not given us any document EVER

nagesh kini

In Reply to Debashis Basu 4 years ago


nagesh kini

In Reply to Debashis Basu 4 years ago


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