The Department of Financial Services (DFS) organized a ‘Coordination Meeting on Vigilance Matters of Public Sector Banks (PSBs)’ today in New Delhi. The aim of the meeting was to enhance inter-departmental cooperation among various government departments, the Central Bureau of Investigation (CBI), and PSBs, with a focus on expediting investigations related to bank fraud cases.
The meeting was attended by key officials, including Shri M. Nagaraju, Secretary of DFS, Shri Praveen Sood, Director of CBI, Chairman of the Advisory Board for Banking and Financial Frauds (ABBFF), the Chairman of State Bank of India (SBI), MDs and CEOs of PSBs, Chief Vigilance Officers (CVOs) of PSBs, along with representatives from DFS, Ministry of Home Affairs (MHA), Department of Personnel and Training (DoPT), Reserve Bank of India (RBI), and the Managing Director of the Central Registry of Securitization Asset Reconstruction and Security Interest of India (CERSAI).
Key Discussions and Outcomes:
The meeting emphasized the importance of addressing bank-related frauds, which remain a significant concern for the sector. Various measures, such as the Insolvency and Bankruptcy Code (IBC) and the creation of the National Asset Reconstruction Company (NARCL), were highlighted as effective tools for resolving stress in banking assets, thus improving the performance and asset quality of PSBs.
The discussions also focused on ensuring expeditious and efficient investigations in bank fraud cases. A strong deterrent effect from swift investigations could lead to better resolution of stressed assets. As a result, various operational strategies for improving cooperation between the CBI and PSBs were deliberated upon.
Detailed presentations by DFS and CBI showcased progress in ongoing investigations into bank fraud cases and other operational concerns. The meeting noted that recent amendments to the Prevention of Corruption Act, 1988, aimed at preventing the investigation and prosecution of bankers for bonafide decisions, had a positive impact. This amendment protects honest decisions made by bankers while addressing fraud.
One of the key decisions was the establishment of regular discussion platforms between bankers and CBI, which is expected to improve operational efficiency and expedite the investigation process.
Operational Improvements:
The meeting also addressed other critical operational issues, including the process of filing complaints with the CBI regarding bank fraud cases, the need for regular reviews of investigations, and the support required by CBI during the investigation process.
A presentation was made by PSB Alliance, a company set up by PSBs to provide joint customer-oriented services. The presentation highlighted an asset tracing IT application that helps PSBs track the assets taken as security for extending credit facilities. It was decided that each PSB would independently assess the necessity of adopting such an application.
