Court Demands Clarity in Account Freezing Protocols

The Allahabad High Court criticizes the indiscriminate freezing of bank accounts during cyber fraud investigations, urging procedural clarity. The court mandates the Union government to address concerns via an affidavit, specifying conditions for account freezing and mandating prompt account holder notification.

The Allahabad High Court has raised concerns over unfair practices by investigating agencies instructing banks to freeze accounts unreasonably amid cyber fraud investigations. Justices Atul Sreedharan and Siddharth Nandan scrutinized the procedure banks adopt, often leaving account holders in the dark about their frozen accounts.

During proceedings centered on a writ petition filed by Tarkeswar Tiwari, the court criticized how banks obscurely act on letters from police or cybercrime units without formal documentation. The judges emphasized the need for transparency and procedure-defined actions, safeguarding account holders' trust.

The court directed the Union government to rectify procedural anomalies and ensure compliance with judicial injunctions. An affidavit is required, defining conditions justifying accounts freezing and detailing account holders' timely notification. A proposed SOP aims to streamline actions, narrowing the procedural gap between authorities and financial institutions.

(With inputs from agencies.)