Fraud Prevention Policy/ Whistle Blower Policy

Summary of Policy
Policy Name Fraud Prevention Policy/Whistle Blower Policy
Related policies and regulations Companies Act, 2013
Issue date May 2014
Effective date May 2014
Date of last review Original Version
Date of next review May 2015
Owner / Contact DMI Finance Private Limited
Approver Board of Directors of DMI Finance Pvt. Ltd.
Annexures NIL
Appendices Appendix A - Policy Review History.



In accordance with Section 177 of Companies Act, 2013 and Clause 7 of the Companies (Meeting of Board  and  its  Power)  Rules,  2014,  the  company  needs  to  establish  a  vigil  mechanism  for  their directors and employees to report their genuine concerns or grievances.

This  policy  enables  an  employee  or  a  group  of  employees who  wish  to  report  on  unethical  or improper practices to have easy access to the appropriate authority. The purpose of this policy is to provide a framework to promote responsible, safe and secure whistle blowing, with an aim to curb and stop all activities, which are against organizational interests.

The vigil mechanism will:

a. provide adequate  safeguards  against victimization of  employees  and  directors  who  avail  of the vigil mechanism

b. provide direct access to the Chairperson of the Audit Committee.

c. In case of repeated frivolous complaints being filed by a director or an employee, the audit committee  may  take  suitable  action  against  the concerned  director  or  employee  including reprimand.


"Fraud" is a willful act intentionally committed by an individual(s) by deception, suppression, cheating or any other fraudulent or any other illegal means, thereby, causing wrongful gain(s) to self or any other individual(s) and wrongful loss to other(s). Many a times such acts are undertaken with a view to deceive/mislead others leading them to do or prohibiting them from doing a bonafide act or take bonafide decision which is not based on material facts.


While  fraudulent  activity  could  have  a  very  wide  range  of  coverage,  the  following  are  some  of  the act(s) which constitute fraud. The list given below is only illustrative and not exhaustive:

a. Forgery or alteration of any document or account belonging to the Company.

b. Forgery or alteration of cheque, bank draft or any other financial instrument etc.

c. Misappropriation of funds, securities, supplies or others assets by fraudulent means etc.

d. Falsifying records such as payrolls, removing the documents from files and /or replacing it by a fraudulent note etc.

e. Willful  suppression  of  facts/deception  in  matters  of  appointment,  placements,  submission of reports, tender committee recommendations etc. as a result of which a wrongful gain(s) is made to one and wrongful loss(s) is caused to the others.

f. Utilizing Company funds for personal purposes.

g. Authorizing or receiving payments for goods not supplied or services not rendered.

h. Destruction,  disposition,  removal  of  records  or  any  other  assets  of the  Company  with  an ulterior    motive    to    manipulate    and    misrepresent    the    facts    so    as    to    create suspicion/suppression/cheating  as  a  result  of  which  objective assessment/decision  would not be arrived at

i. Any other matter which affects the reputation of the company.


The ‘Audit Committee’ shall oversee the vigil mechanism through the committee and if any of the  members  of  the  committee  have  a  conflict  of  interest  in  a  given  case,  they  should  recuse themselves and the others on the committee would deal with the matter on hand.

Any employee (full time, part time or employees appointed on adhoc/temporary/contract basis), as soon as he/she comes to know of any fraud or suspected fraud or any other fraudulent activity must report such incident(s). The reporting of the fraud normally should be in writing. In case the reporter is not willing to furnish a written statement of fraud but is in a position to give sequential and specific transaction of fraud/suspected fraud, then the officer receiving the information should record such details in writing as narrated by the reporter an also maintain the details about the identity of the official/employee/other person reporting such incident. Reports can be made in confidence and the person to whom the fraud or suspected fraud has been reported must maintain the confidentiality with respect to the reporter and such matter should under no circumstances be discussed with any unauthorized person.