FinMin asks banks for prompt reporting of vigilance matters

New Delhi: The finance ministry has directed public sector banks and financial institu-tions, including insurance companies, to promptly report vigilance-related matters concerning whole-time directors (WTDs) of their respective com-panies.

The directive from the Department of Financial Services (DFS) under the ministry follows several instances where adverse information about board-level appointees was not promptly reported.

In many cases, it said, such critical adverse inputs like private complaints, court observations, references or inputs from the CBI or other Law En-forcement Agencies are being reported only at the time when Vigilance Clearance is specifically sought from the Chief Vigilance Officers (CVO) of PSUs.

Without citing any specific case, the advisory issued earlier this month, said, in certain cases even the crucial information relating to WTDs is omit-ted in the Vigilance Clearance formats on the ground that no specific col-umn exists for such disclosure.

Observing that omission of any significant information, particularly infor-mation relevant to decisions relating to appointments, promotions, board-level postings, and placement of WTDs, is a matter of serious concern, it said, strict compliance in such matters is expected from PSUs.

The DFS has directed public sector banks and financial institutions for im-mediate reporting of adverse inputs regarding board level officials even though the alleged lapse pertains to any other capacity other than board.

Besides, it advised them for submission of comprehensive disclosure in vig-ilance clearance which would include observations or directions of courts or tribunals internal committee findings, audit observations of a serious nature and communications from any department or agency.