Forgery in banking sector has been in existence from centuries and become a big business. Over the years, forgery in this sector has been known and increasing day by day due to increase in number of private and foreign banks i.e. increase in number of branches, increase in number of employees, increase in volume of business, increase in customers and spread of operation. Increase in banking sector has given rise to the white collar crime through forgery done by the employees of the bank or by the outsiders or by financial institution. There is a contractual relationship between banker and customer and bank is held liable for any fraudulent transaction. Bank must take remedial measure for prevention and detention of forgery. The fraud, forgery is generally found in exchange of services rely on information and technology and the absence of physical bank branches to provide these services to the customers. Forgery has been defined under section 463 of Indian Penal Code 1860, Section 464 of Indian Penal Code 1860 defines making of a false document and Section 465 of Indian Penal Code provides punishment for committing forgery. In this paper an attempt is made to understand the meaning of forgery, its punishment, their remedial measures and banker’s liability for the payment of forged cheques.