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Ex-ED of Indian Overseas Bank appointed CVC board member on bank frauds


Ex-ED of Indian Overseas Bank appointed CVC board member on bank frauds

Former executive director of Indian Overseas Bank A D M Chavali has been inducted into a five-member advisory board for banking and financial frauds created by the CVC to act as the "first-level of examination" in respect of general managers and above rank officers, according to an official order. The tenure of Chavali would be up to August 20, 2021, the order issued by the Central Vigilance Commission (CVC) said.

The board, headed by former vigilance commissioner and the then chief of Indian Bank T M Bhasin, has former urban development secretary, Madhusudan Prasad, former director general of the Border Security Force, D K Pathak, and the then managing director and chief executive officer of Andhra Bank, Suresh N Patel as its members. No action can be initiated against top bankers for involvement in suspected frauds before the advisory panel reconstituted recently by the CVC gives its nod for it.

"The advisory board for banking and financial frauds shall function as the first-level of examination, in respect of officials in the rank of GM and above in public sector banks and equivalent thereof in public financial institutions incase of frauds amounting to more than Rs 50 crore, before such organisations initiate action in matters of banking and financial frauds," the probity watchdog said. The board will also tender advice in respect of these top ranking officers under all relevant laws, including all composite cases, it said.

The move followed a fortnight after Finance Minister Nirmala Sitharaman had assured bankers that honest commercial decisions taken by them will be protected and a distinction would be made between genuine commercial failures and culpability. All administrative ministries and entities of the government have been asked to ensure that the advice of the board "has been sought, received and made available, in respect of officials in the rank of general managers (GM) and above in public sector banks and equivalent thereof in public financial institutions incase of frauds amounting to more than Rs 50 crore to the investigating agencies", the CVC said.

These probe agencies may take such advice into account while taking consequential action to initiate preliminary enquiry or investigation and follow due procedure under the Prevention of Corruption Act, 1988, it said. "Incase during the course of investigation, the involvement of a public servant employed in public sector banks and public financial institutions above the rank of GM comes to the notice of the investigating agency, they may refer the matter to the board for advice before proceeding further," the order said.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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