CVC seeks power to initiate action against banks CMDs, EDs

The Central Vigilance Commission (CVC) has sought powers to probe corruption charges against Chairman and Managing Directors (CMDs) and Executive Directors (EDs) of public sector banks and insurance companies.
CVC has asked the Finance Ministry to incorporate relevant provisions in the rules to allow it to conduct disciplinary inquiries against CMDs and EDs, i.E. Whole Time Directors (WTDs) while in service and continuation of such probes after they demit office, official sources said.
The anti-corruption watchdog has also sought powers to initiate penal action against them, if they are found guilty of corruption, even after their retirement, they said.
At present, there is no rule to conduct investigation or disciplinary inquiry by the Commission against CMDs and EDs working in public sector banks, insurance companies and some financial institutions, the sources said.

The Commission examined the issue after it received complaints of alleged irregularities against some of these top executives, they said.
CVC observed that the existing standard terms and conditions of appointment of WTDs i.E. Board level officers of public sector banks, insurance companies etc., do not have a specific provision for initiating disciplinary action while in service, the sources said.

However, CVC can take necessary disciplinary action against board-level officers in Central Public Sector Enterprises (CPSEs). The standard terms and conditions of appointments provided by the Department of Public Enterprises allow initiation of disciplinary action against the board- level officers in CPSEs while they are in service, they said.

CVC has sought similar provision for WTDs of banks, insurance companies and other financial institutions by the Department of Financial Services (DFS), the sources said.
It wants adequate provision for continuation of proceedings against WTDs of banks and insurance companies under pension regulations after completion of their tenure as well as initiation of proceedings under pension regulation upto four years as is the case in the government, they said.
The matter is being discussed with the officials of DFS, the sources added.
Last month, Syndicate Bank CMD S K Jain was arrested by CBI for allegedly receiving a bribe of Rs 50 lakh to enhance credit limits of Bhushan Steel and Prakash Industries.

Besides, some officials of Oriental Bank of Commerce and Dena Bank are being probed for alleged misappropriating funds worth Rs 436 crore from fixed deposit customers' accounts.