In response to challenges in fraud classification, Indian banks are preparing to approach the Reserve Bank of India (RBI) for permission to conduct parallel internal investigations when law enforcement agencies (LEAs) initiate probes into borrower accounts. Currently, banks are mandated to tag an account as 'red flagged' if an LEA investigation begins, which can lead to legal scrutiny due to the lack of clarity on the investigation's specifics and timelines. The Supreme Court's recent ruling, which states that no personal hearing is required before tagging an account as fraud, has prompted banks to seek improvements in their internal frameworks, including enhanced early warning signal systems. Discussions among banks and the government have taken place over the past two months, and a formal request to the RBI is expected once these discussions are finalized. Additionally, banks are advocating for the right to make final decisions on fraud classification in consortium lending cases, allowing them to align their decisions with internal policies.