With reference to this thread, I would like to give a more relevant correct positions and facts on certain statements made in the thread as well as response above: My version is with reference to nationalised banks in particular.
Presumption 1: Floating money in banks is being used by bank staff to invest in small finance companies privately to earn extra cash for themselves
Fact and correct position: Only an authorised cashier is allowed to handle physical cash in banks. Only a reasonable and small amount of cash is paced at his/her disposal for starting and continuing transactions. The cashier logs in with his bio-metric and/or other authorised identity. Any transaction in bank goes through the system and authorisation by two officials. At any point the supervisor as well as the cashier can know the status of cash at hand. Bank has system of surprise checking, if needed, cash counter by authorised inspection officials.
So if any unrecorded cash is allowed to go out of the cash cabin, then that is almost equal to suicidal action by the cashier. If by rarest of cases, such thing happens, that person should not be allowed to function. Even public is responsible to catch such a person, because bank is dealing with public money.(System and his own nemesis will definitely catch up with him and he will be caught and punished)
Presumption 2: An auditor will be a middle man in this bargain. Bank officials also harass the people who come with proposals and take money from them.
Fact and correct position: Most of the loans individuals avail do not need any papers or document requiring expert advice. It is just simple and plain that a prescribed application has to be filled up and the required supporting documents like income proof, security details, quotation or estimates etc are to be attached. For small proprietary and partnership business also their own office accountant staff can do the needful. Even for big corporate they have their own accounting and financial departments who can handle the matters and give necessary documents and papers. Big loans are sanctioned at higher level of authority after they are scrutinised by various lower layers. Banks also have to comply to various statutory terms and stipulations. So delays can happen. They need not be seen as deliberate harassments. (I am not competent to contest, if anyone had a rare different experience;)
Presumption3: Some bank managers suggest valuers to the client for their valuation. These people value the property at a higher level and loan will be sanctioned. In this process the bank official will get benefited.
Facts and correct position: Banks have a panel of approved valuers. They are selected and empanelled by a system of selection considering various parameters including their standing, reputation and integrity, approval by government and other authorities etc. One valuer can be in the panel of more than one bank also.The valuers lso have certain basic parameters. If anyone does wrong valuation,to the detriment of banks and clients, then the banks may remove them from the panels. Most banks also have a system of the branch manager's own independent assessment and valuation from his own independent sources. They should reasonably match except for technical accuracy. Nowadays there are ready reckoners for such things in major cities given out by the technical chambers and bodies.
Presumption4: Corruption is there in all levels including postings/ transfers.
Fact and correct position: Recruitment, transfers and promotions in bank personnel is within the Bi-partite system agreed upon involving the bank management and the employee's trade unions. There is maximum transparency and norms for the same. The personnel are regularly transferred to prevent any vested interest developing. That is one very important check to prevent corruption in banks. Within an office itself, the staff are not allowed to handle one department or section for long periods, They are periodically rotated.
To sum up,bank personnel also are from the same society we all live in. So there can be different type of people and some of the negative happenings in the society in general could also be found in banks also. However because of the various systems and checks in place, the corruption in banks is very minimal and limited only to certain points. The public at large is not affected by that menace. Even those rare cases would be found by the various systemic checks and culprits caught , due process of law brought in for dealing them.