Graft cases in private banks to come under central vigilance commission lens | india news | Hindustan Times
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Graft cases in private banks to come under central vigilance commission lens

The CVC is the statutory body that investigates cases of graft under the Prevention of Corruption Act, 1988, but is authorised to probe cases involving central government departments, public sector companies and their workforce.

india Updated: Feb 22, 2017 10:20 IST
Mahua Venkatesh
The central vigilance commission will not intervene in appointment of chiefs of private banks.
The central vigilance commission will not intervene in appointment of chiefs of private banks.(HT Photo)

The central vigilance commission (CVC) will monitor graft-related cases in private sector banks as well, a move that comes amid reports that officials of several such financial institutions were allegedly involved in money laundering after the demonetisation exercise.

The CVC is the statutory body that investigates cases of graft under the Prevention of Corruption Act, 1988, but is authorised to probe cases involving central government departments, public sector companies and their workforce.

But a notification, which is expected in the next couple of months, will enable the government’s anti-corruption watchdog to check graft in private banks too.

Also, the decision complements a landmark Supreme Court judgment in February last year in which it expanded the scope of the anti-corruption law by bringing private bank employees within the act’s ambit.

The change was made while overturning a lower court verdict that charges under the anti-corruption act could not be framed against two top officials of the erstwhile private sector Global Trust Bank in a Rs 41-crore corruption case because they were not public servants.

“We are expecting the notification to come very soon and once that happens we can directly keep an eye on the private sector bank officials too,” TM Bhasin, the chief vigilance commissioner, said.

However, the CVC will not intervene in appointment of chiefs of private banks.

The watchdog is collaborating with chief vigilance officers (CVOs) of the Reserve Bank of India to investigate allegations against executives of private banks that emerged after the government recalled 500- and 1,000rupee notes last November in a sweeping attempt to suck out illicit cash from the system.

Once the CVC’s ambit is expanded, it will be able to appoint CVOs to monitor graft in private banks.

About 400 officials from both public and private banks have been suspended for alleged money laundering since the demonetisation exercise kicked off. Notices have been sent to all the suspended officials.

“We are doing our job. Depending on the final findings, action will be taken, charge-sheets will be issued and punitive action will be taken against the guilty,” Bhasin said.