FinMin to create platforms to fast-track fraud cases

Finance Ministry’s Department of Financial Services (DFS) in a meeting with RBI, MHA and other stakeholders agreed to create platform for regular discussion between bankers and CBI to expedite investigation in bank fraud-related cases.

“Requests made by CBI are examined by bankers and honest decisions remain protected. It was also agreed that platforms will be created for regular discussion between bankers and CBI,” said the Ministry of Finance in a statement.

“Other operational issues related to filing of complaints with CBI in bank fraud cases, regular review of investigation and support required by CBI during investigation process was also discussed. It was observed that regular discussion between bankers and CBI will bring in operational efficiencies in the investigation of bank fraud cases,” said the statement further.

What happened during meeting?

The ministry in the statement said that meeting focused on expeditious and effective investigation in bank fraud cases that will have salutary deterrent effect and is likely to further catalyse resolution of stressed banking assets; and all measures were discussed for expeditious investigation in bank fraud cases.

“For facilitating this, various areas of cooperation between CBI and PSBs were discussed, with detailed presentations made by DFS and CBI to highlight the progress made in investigation of bank fraud cases and other operational issues,” said the government’s statement.

It was noted during the meeting that amendments made to Prevention of Corruption Act, 1988, to prevent investigation and prosecution of bankers for bonafide decisions has had a positive impact. According to an amendment under Section 17A of the Prevention of Corruption Act in 2018, an investigative agency can initiate a probe against bank employees only after the bank management approves it. Unlike PSU banks, private banks do not come directly under the purview of investigating agencies, yet under the law an approval from their management too is required to probe their employees.

Over the past year, agencies such as the Central Bureau of Investigation (CBI) and Vigilance Commission have complained that hundreds of cases are pending closure because bank managements are not giving them approval to probe their employees.

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