UPI Fraud : Bank of Maharashtra lost 25 crores
Bank of Maharashtra has reported that the bank has lost Rs.25 crores due to a fraud through UPI app.
The fraud took place due to a bug in UPI , which was used by a some people in Aurangabad.
How the fraud took place:
A few people discovered that even if you don’t have have balance in your account UPI App of Bank of Maharashtra is successful sending money to receiver’s bank account. They did hit and trials and then transferred around 25 crores to their accounts in other banks. Although CBS of Bank of Maharashtra denied the transaction but UPI sends success message to NPCI resulting that NPCI clearing and settlement the amount.
[Suppose you have only Rs.100 in your BoM account, you transfer Rs.1 lacs through UPI to BoI account, although BoM’s CBS declines the transaction but UPI will send a success message to NPCI and NPCI will clear the funds to BoI account.]
The Unified Payment Interface (UPI) app, in which bug has been detected has been developed by a Vendor Infrasoft Tech for Bank of Maharashtra. Three more banks have procured the UPI App from same vendor, however, none of them have reported any such mishap.
FIR has been lodged and Bank is trying to recover the amount from the bank accounts where it has been transferred.
NPCI said that they are not allowing banks to join UPI unless they have thorough reconciliation process and audited their package by best of auditors.