EC move to check misuse of money power rejected
The Election Commission's effort to check use of money power in elections has received a set back with the finance ministry rejecting its proposal for special monitoring of bank accounts of political persons.delhi Updated: Jul 26, 2011 00:18 IST
The Election Commission's effort to check use of money power in elections has received a set back with the finance ministry rejecting its proposal for special monitoring of bank accounts of political persons.
The Reserve Bank of India (RBI) has detailed guidelines for monitoring Indian bank accounts of politically exposed persons (PEPs) of foreign origin. "The guidelines provide for enhanced scrutiny by banks of foreign PEPS but not of domestic PEPs," a senior Election Commission official said.
PEP, as per RBI guidelines, is a public functionary including ministers, senior bureaucrat and member of a political party.
To improve vigil over domestic PEPs, the EC also wanted to harmonise banking laws with the Representation of People's Act and similar RBI guidelines to banks for domestic political persons.
"If rules under PMLA are modified to include domestic PEPs, then the verification of assets and liabilities of the candidates will become more meaningful," said a commission official.
As per the Election Commission rules, every person contesting legislative elections have to file an affidavit declaring his assets and that of his family members. But, the commission has no way to verify the claims made in the declaration and it felt that having enhanced scrutiny for domestic PEPs around the year could have helped in tracking transactions in financial institutions and securities market.
For the commission bringing domestic PEPs under high scrutiny would have helped to check misuse of money power in elections which was recently highlighted with seizure of Rs 60 crore in assembly elections in Tamil Nadu alone.
For this, a proposal was discussed with the senior finance ministry and Income Tax officials.
Documents released by the Election Commission in response to an RTI application show that the finance ministry were not keen to implement the changes and instead, asked the commission to seek specific information about PEPs from the banks directly, rather than seeking a policy direction.
The reason was that affairs of a customer are considered confidential and there are well established legal provisions in the banking laws and conventions about a client's secrecy and fidelity, which the banks are supposed to observe.