Lenders form panel to protect bank executives against graft cases

Mumbai, Feb 21, 2024 

The committee, headed by D C Jain, a former senior officer with the CBI, is expected to suggest ways to protect bank executives from arbitrary actions related to loan decisions

Lenders have formed a panel to devise strategies for effectively dealing with cases that bank employees encounter under the Prevention of Corruption Act. The committee, headed by D C Jain, a former senior officer with the Central Bureau of Investigation, is expected to suggest ways to protect bank executives from arbitrary actions related to loan decisions.

A senior bank official with a public sector bank said there has been a long-standing issue of providing comfort to employees and avoiding harassment. While the focus of the panel's work is understood, details regarding the timeline for submission and terms of reference are not known.

This issue is relevant to all working in commercial banks, especially those in public sector financial institutions who face complex situations against the backdrop of vigilance, pointed out another public sector bank executive.

Sunil Mehta, chief executive of the Indian Banks' Association, did not respond to messages and calls.

The panel will have representatives from public sector banks, including the State Bank of India.

Bankers have sought additional protection under the provisions of the Prevention of Corruption Act. The plea is to extend the immunity currently given to the top executives of the National Bank for Financing Infrastructure and Development, a newly formed 100 per cent government-owned entity.

Under Section 17A of the Act, prior approval is necessary for conducting any inquiry or investigation into any offence allegedly committed by a public servant. Many court rulings have opined that those working in banks are treated as public servants for this act, bank executives said.

[The Business Standard]