MINISTER OF STATE IN THE MINISTRY OF FINANCE ( SHRI S.S. PALANIMANICKAM)
(a) & (b): As reported by the Reserve Bank of India (RBI), no target has been fixed for housing loans for
banks/financial institutions during the current year. Banks are free to allocate finances for housing based
on their own appraisal and loan policies, as approved by their respective Boards. However, under the Golden
Jubilee Rural Housing Finance Scheme (GJRHFS), the Government have fixed an indicative target of 2.50 lakh
dwelling units for the current year i.e. 2004-05.
(c): No, Sir.
(d): Does not arise.
(e): The number of frauds in housing loans in commercial banks and Primary (Urban) Cooperative Banks during
the last two years and upto June 2004 are as under:
S.No. Year Number of Frauds Amount (Rs. in Crores)
I. 2002 236 28.33
2. 2003 456 69.05
3. 2004 (up to June 2004) 380 49.82
(f): Trie National Housing Bank (NHB) has communicated to all banks/housing finance companies/cooperative sector
institutions, the break-up of the target fixed under Golden Jubilee Rural Housing Finance Scheme (GJRHFS). These
disaggregated targets are monitored by NHB on a quarterly basis. RBI has taken several steps to counter the menace
of frauds in home loans which, inter-alia, include:
i) Requesting all State Governments to bring certain progressive measures such as marking the
encumbraace of the banks on the mortgaged properties with the Registrar of assurances by payment of a
nominal fee as this measure will go a long way in arresting multiple creation of mortgages by the fraudsters;
ii) Cautioning the banks from time to time against fraudsters and their modus operand!. RBI issued circulars to
banks in May, 2002, October, 2003 and September, 2004 suggesting series of measures for clicking frauds in Housing
sector loans;
iii) Monitoring the fraud cases involving Rs. 1 crore and above on quarterly basis;
iv) Issuing of caution advises to banks in respect of fraud cases involving builders/unscrupulous borrowers;
v) Advising banks to carry out field level inspections at branches having large exposure to home loans;
vi) Calling the bank officials for discussions on different issues relating to housing loan frauds and to
impart them knowledge about the preventive steps to be taken;
vii) Lodging of complaints, wherever necessary, with the local police or CBI or in the courts of law
in cases of fraud to deter people and employees from indulging in such activities.
