Indian Cases: Often Misunderstood and Misreported

Having seen your recent installment of DCW Scam Survey covering Indian cases (Indian Importer, Officials Booked for Cheating Tied to LC, Jan 2025 DCW), I felt compelled to respond and hopefully enlighten.

Every reported financial or banking scam in India is not a proven scam or case of fraud and, more importantly, may not be a documentary credit-related scam. The Indian legal process involving alleged frauds can be long, arduous, and tortuous. In many instances they typically start from a loan turning bad (non-performing) in a bank. The bank carries out a forensic audit post which – if in its judgment determines that there is a fraud – leads to a complaint being filed with the CBI [India's Central Bureau of Investigation] and/or other investigation agencies. When this occurs, the case takes the shape of State vs. Borrower. The CBI always has to operate on the presumption of fraud, even if it cannot prove it with certainty. CBI then proceeds to file a charge sheet at a special sessions court designated specifically to handle CBI investigated cases. It declares the borrowing company as an accused fraudster and invariably lists all the connected parties (even those connected remotely) as co-accused probably as witnesses.