Letter to BS: Watering down framework for detection of bank frauds is wrong

This refers to “Bankers get shield from fraud heat; boards of PSBs to be held accountable” (January 29). Watering down the framework for timely detection, reporting and investigations of high-value frauds with a view to reducing the accountability of MDs/CEOs of public sector banks (PSBs) is not the way to encourage lending. Dealing with frauds and lending are two independent issues. Are we saying that the responsibility and accountability for dealing with frauds gets diminished when there is an economic and, bank lending, slowdown? There must be consistency in dealing with frauds. There must be a clearly defined and consistent action plan in the framework to deal with high value frauds, despite insidious attempts to link the two. The instructions regarding high-value frauds come within the realm of the banking regulator. Instructions should be uniform across the banking industry. The government should not stray into the regulatory domain and set up a separate sets of rules for PSBs as this would send a wrong message to the banking community. Lending has slowed down because of the state of the economy and high non-performing assets of the PSBs and not because of the fear of dealing with high-value frauds.
 
Arun Pasricha, New Delhi

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