Abstract: This research paper undertakes an exhaustive disquisition of the multifarious issue of banking fraud in India's public sector banks since the Economic Reforms of the early 1990s to the present era. It elucidates high-profile cases such as the Vijay Mallya, Nirav Modi, Yes Bank Scandal, and DHFL Fraud, illuminating systemic deficiencies including regulatory lacunae, inadequate corporate governance, technological vulnerabilities, and the complicity of bank employees with malefactors. The study meticulously investigates the economic repercussions, notably substantial pecuniary losses, a diminution of public trust, augmented regulatory vigilance, and escalated compliance expenditures. Additionally, it examines the socio-economic ramifications on stakeholders, encompassing depositors, employees, and policymakers. The analysis propounds a series of well-founded recommendations for the establishment of rigorous regulatory architectures, heightened accountability, cutting edge fraud detection technologies, and comprehensive training regimens for banking personnel. The paper endeavours to discern the various types and frequencies of banking fraud, evaluate their impact on the banking sector and broader economy, unearth root causes, and propose effective stratagems to ameliorate fraud risks and fortify the resilience of public sector banks. Utilizing data from the RBI, the study accentuates the indispensability of enhanced regulatory oversight, superior internal controls, and pioneering technological solutions to safeguard the Indian banking ecosystem. The findings underscore the necessity for continuous surveillance, proactive risk management, and the assimilation of best practices across the banking sector to foster a secure and trustworthy financial environment.

Keywords: Banking Frauds, Financial Malfeasance, Public Trust Erosion, Reserve Bank of India

| DOI: 10.17148/IARJSET.2025.12118