City Union Bank's statement says that "international cyber criminals" and not internal staff members were responsible for the fraudulent transactions.
Stung by the Rs 11,400 crore fraud in Punjab National Bank, the Reserve Bank of India (RBI) has constituted an expert committee under the chairmanship of Y H Malegam, a former member of the Central Board of Directors of RBI, to look into the entire gamut of issues relating to classification of bad loans, rising incidents of frauds and effectiveness of audits.
The central bank said it had alerted banks thrice on potential malicious use of SWIFT infrastructure since August 2016. The lender then alerted the correspondence banks to recall the funds.
"Of the three fraudulent remittances, one remittance was made through Standard Chartered Bank, New York to a Dubai based bank for $500,000 was blocked immediately and returned back to us", the statement said.
The bank blocked one of the remittances for US$500,000 that was being sent through a Standard Chartered Bank account in NY to a Dubai-based lender and another transfer of Euro 300,000 (US$370,110) routed through Frankfurt to Turkey.
However, a third transfer of $1m sent via a Bank of America account in NY to Zhejiang Rural Credit Cooperative Union in Hangzhou, China, appears to have succeeded. The beneficiary had claimed the funds by submitting forged documents.
N. Kamakodi, the Chief Executive Officer, said that it is a conspiracy that involved various countries.
"This is basically a cyberattack by global cybercriminals", the bank's CEO N. Kamakodi told Reuters. "There are some legal processes that need to be completed before the money could be retrieved back", Mr. Kamakodi said.
Society for Worldwide Interbank Financial Telecommunications - is a messaging system banks use worldwide to send encrypted information and instructions.
Weaknesses in SWIFT were exposed after Bangladesh's Central Bank lost US$81 million in a cyberattack in 2016.
Digital attackers abused the SWIFT system of an Indian bank in an attempt to make off with approximately $2 million in stolen funds. The Indian Consulate in Instanbul is now working to help repatriate that amount.