Business Standard

Bankers get shield from fraud heat; boards of PSBs to be held accountable

Measures to protect prudent commercial decisions of PSB brass

Money, Banks

Somesh Jha New Delhi
The government has watered down its framework for dealing with high-value frauds in a bid to encourage managing directors (MDs) and chief executive officers (CEOs) of state-owned banks to take commercial decisions fearlessly.

Instead of MDs and CEOs, the boards of public sector banks (PSBs) will now be held accountable for the various regulator-prescribed timelines for reporting or investigating frauds above Rs 50 crore, according to a directive sent by the finance ministry to banks.

The finance ministry had in May 2015 created the framework on “timely detection, reporting, and investigation” relating to large-value bank frauds. “The overall responsibility” for ensuring compliance

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First Published: Jan 29 2020 | 12:47 AM IST

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