FINANCE

 
1- ADDRESSING FRAUD AND FORGERIES IN BANKS
2-
ISLAMIC FINANCE, BANKING AND INSURANCE
3-
PUNJAB EXPANDS TAX NET
 

ADDRESSING FRAUD AND FORGERIES IN BANKS

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The most important and fundamental factor responsible for the growing incidents of fraud and forgery is weak Human Resource

 

By SAJJAD AHMAD QURESHI
June 27 - July 03, 2005
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Lust for money, glamour, glitter and splurge has its own impact all around the world. Some want to become rich overnight by hook or by crook. We all as Muslims must know and believe that whatever God has decided to bless us with will come our way before our death. However, we need to work hard and do our best leaving the rest to Almighty Allah. God will do justice and would certainly bless in any form He may feel what is good for us. We especially as bankers have to take every possible care of our "Image" and "Integrity". These two elements should always be kept supreme in our lives. We are the custodians, financial partners and advisors of our customers. They trust us more than anybody else. We should never shatter their confidence and trust.

With my experience of three decades I believe that banking is one of the most respectable and noble professions/careers the world over. It has great scope and immense growth potential. Bankers are well regarded in society because of their noble and respectable profession. Besides, they enjoy a package of facilities which provides them honest/decent living and a clean/peaceful life. All they need is to remain contented and work with passion and professionalism making their market value/repute and marking distinctive success in their profession. Money follows success. Don't run after money, let it run after you.

The most important and fundamental factor responsible for the growing incidents of fraud and forgery is weak Human Resource (HR). As we all know that HR is the major ingredient for running any institution. At times more importance is given to the quantity instead of quality. But we should know that for quality product we need quality raw material. It goes without saying that HR has great importance everywhere, but in banks "Angel" like people are expected to handle the financial matters of their customers with every possible honesty, care and caution. They have to be honest, well-groomed, well-spoken, gentle, humble and mentally and professionally sound people. They are not only required to look after the interest of their customers but have also to protect the interest of the bank in all respects. Thus a quality HR plays the ultimate role in keeping our banks free from frauds with high level of growth/performance.

The selection process of HR has to be made as perfect as possible because from here everything good or bad begins. We need a transparent and merit-based hiring policy without any compromise. The rest of things are bound to fall in place. With experience the selectors should be able to look into the seeds of time and predict which plant will grow and which will not. I personally agree to the school of thought that blood and grooming of a person is very important. I have my belief that the family backgrounds, the institutions from where we get education, the environments in which we are brought up and groomed have great impact on our personality and outlook, forming our attitude and behavior in our personal and professional lives.

The sound family background means belonging to an educated and noble family and not necessarily a rich family. The repute and image of the potential candidate must be checked thoroughly before his induction. I feel that these are the aspects needed to be considered at the time of selection of the employees. The bitter matter of the fact is that at times to oblige people important for the selectors or the reasons best known to them, the fundamentals/essentials of selection of an employee are ignored. From here the real problem starts. However, if a person is fulfilling the basic requirements and also comes through some reliable reference or recommendation or he is a tested and tried one; there is no harm in hiring him. He can prove to be even better and beneficial for the institution.

After selection, the management needs to plan a proper career path for newly inducted young bankers. Most importantly through our rich Quranic/religious teachings we need to develop a strong sense of realization among them regarding the duties, responsibilities and the important role, which they all have to play in the society as Muslims and also as good human beings with sincerity and honesty. Then they should be given a well designed/planned professional training. After going through the above process of selection, training and grooming we can expect quality human capital comprising high performers, dedicated and committed team of honest and clean bankers.

 

 

One of the UK-based companies gave the reason for its exceptionally high performance was to follow the principle of "hire the best, pay the best and get the best". Besides, there is a school of thought, which says: "Don't waste your time in motivating people, rather hire self-motivated people and do not let them be demotivated". But at times the hidden talent needs motivation for bringing them out in the forefront.

The self-motivated, groomed and trained person with personal and professional soundness will deliver ultimately and no one else. He would have human values, humility, and a sense of personal and professional responsibility towards his customers and society. This will prevent him from indulging in any act of fraud and forgery. Neither he would permit the insider nor outsider to commit any fraudulent act because of his honest intentions and professional effectiveness.

It goes without saying that the seniors have to set examples for their juniors. If the senior is not doing justice to his job, how he can expect from junior to be sincere with his duty. It is observed that whenever any fraud is surfaced the ultimate reason is lack of concentration, interest, incompetency or involvement of the concerned staff in the activities other than his job, which gave space for the incident to happen. The seniors have also limitations; they cannot keep check on the working of every seat. Every staff member is expected to perform his duty with complete responsibility and every sense of ownership. Thus, I repeat a capable, dedicated, committed and professionally sound person would strictly follow the instructions/system and would not let anybody cross the limits and parameters, allowing any act of mistake or mishap.

In the present world of excellence and intense competition, we cannot afford to be mediocre. This is a world for survival of the fittest. Only the best will perform best and would be able to lead in the market. We need to set high standards of "Corporate Culture" and "Good Governance" in our banks where everything is defined and strictly followed in its true letter and spirit. The corporate culture stands for disciplined people, disciplined thoughts and disciplined actions". Professional and personal jealousy is a natural phenomena and a human instinct which can be contained to a great extent only through corporate culture. The infusion of corporate culture in any institution would certainly take its time. What we need is sincerity, determination and commitment to start the process without wasting time, in the larger interest of our institutions and for a better tomorrow for our employees and their families.

We need to give complete respect and support to our staff without any personal grudge, vendetta and favours. The damage of such negative acts to the institution is beyond our imagination/thinking. Negativity always brings negative results. Positive thinking and actions bring positive results. However, it goes without saying that the nature has its own ways to warn and check such biased and unfair people. We should create cordial and congenial environments both professionally and physically so that the employee should feel proud and happy to work for the institution. This is very important.

The best way of managing people is to take every action on its merit and deal with the staff/colleagues respectfully and professionally and with all fairness. Involve their interest with the interest of the institution. We should not under estimate people. Nobody is perfect. We need to identify and uplift the good qualities of the employee using them in the best interest of the institution. Besides, we should put our sincere efforts in improving their weak areas. The seniors are expected to give them confidence and boost their ego and morale instead of frustrating, insulting, embarrassing and making them target. The management can make or mar the culture of the institution and HR quality.

So far we have talked about the essentials of new hiring process and their grooming but the question arises as how to deal with our existing staff? It goes without saying that the existing culture of any institution cannot be changed into a corporate one overnight; this will certainly require time and thorough planning. We have to bring revolution through evolution. First of all we need to reassess the quality of our present employees and develop a well thought strategy to improve the same. The best way to do this is to hire quality HR and mix them up with the old ones. Set transparent and merit based clear standards to evaluate the overall performance of the staff. Encourage the old ones enabling them not only to improve themselves but also put them in healthy competition with the new ones. Let them not feel any threat to each other rather develop good understanding between them. They should consider themselves together as a team striving for a common objective that they aim to achieve for their banks. It is always a teamwork, which plays pivotal role in the overall success of any institution. Every member of the team is important and deserves fair treatment.

I wish to conclude on the note that in order to avoid the growing incidents of fraud and forgeries within and without, we need strict control and checks. Only quality HR - the capable, vigilant and professionally sound and stable staff can keep effective checks and controls to prevent banks from frauds. Thus we need to give top priority to quality of the staff in banks through transparent and merit-based hiring policies and providing them proper training and growth oriented career path. To me the quality staff will give us quality policies, quality systems, quality controls and checks enabling us to reduce the fraud mishaps in banks to a great extent. Hire the best, pay the best and get the best. My submissions are to be seen in general, the exceptions will always be there.