RBI asks BoR to sack deputy managing director Saruparia

The Reserve Bank of India (RBI) today asked troubled lender Bank of Rajasthan — set to be acquired by ICICI Bank — to remove Deputy Managing Director Deepak Saruparia, charging him with violation of norms in certain property transactions related to the bank.

“The Reserve Bank of India.has directed that Deepak Saruparia shall stand removed from the post of the deputy managing director in Bank of Rajasthan with immediate effect,” BoR said in a communique to the Bombay Stock Exchange.

RBI also said that Saruparia “shall not in any way, either directly or indirectly, be concerned with or take part in the management of any banking company for a period of five years from June 12, 2010.”

The central bank, which issued a showcause notice to Saruparia a few months back, is understood to have charged Saruparia with irregularities in property transactions during 2002-2004, including that of an office building at Lower Parel. RBI is also understood to have found irregularities in handling of certain corporate accounts during Saruparia’s tenure. Saruparia, who joined BoR in August 2004, was elevated to the post in 2007.

Saruparia said charging only him was not proper as these decisions were not taken by him individually but collectively and were also approved by the bank’s board. He added the alleged transactions were executed prior to his taking over as the deputy managing director of the bank.

“The decisions were taken unanimously by the board of directors. There were RBI nominees on the board that time. Singling me out is not proper,” Saruparia said.

In February, RBI imposed a Rs 25-lakh penalty on the Jaipur-based bank for violation of a host of norms, including acquisition of immovable properties, deletion of records, and non-adherence to KYC (know-your-customer) norms and anti-money laundering guidelines. Market watchdog the Securities and Exchange Board of India also came down heavily on the bank by banning around 100 entities, including its promoter, the Tayals, from accessing the stock market.

A senior BoR official, on condition of anonymity, said, “The charges (against Sarupuria) are mainly in relation to the acquisition of immovable properties and certain corporate transactions.”

Incidentally, the RBI-appointed special auditor, Deloitte Haskins and Sells, did not find any serious irregularities in the bank’s accounts in its interim report submitted last month.