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Our Economic Bureau
New Delhi, Nov 24: The Central Vigilance Commission (CVC) has drawn up plans to make it mandatory for listed companies to switch to electronic clearing system and nationalised banks to computerise at least 70 per cent of their operations.
Talking to mediapersons after the conclusion of his four-hour meeting with bank chiefs, chief vigilance commissioner N Vittal said,``I will soon notify the changes legally which will make it mandatory for companies and banks to implement the changes.''
Vittal held a meeting of chairmen, managing directors and vigilance officers of leading banks where he stressed the need for restructuring vigilance manuals of financial institutions and banks.
Expressing concern over growing cases of fraud and irregularities in the banking system, Vittal said the changes would make it essential for nationalised banks to computerise at least 70 per cent of their operations by January 1, 2001.
Giving details of the proposed arrangement, Vittal said the Reserve Bank of India will beprovided with 400 to 450 V-sats, which will make it possible to hook the public-sector banks with the RBI.
At the moment, the central bank has just one-eighth of transponder space in V-sat which would be increased to half transponder space to receive information from banks about frauds and willful default, he said. The banks will be required to report fraud cases of Rs 25 lakh and above to the RBI which in turn will be circulated to all banks to ensure such entities do not open new accounts in other banks, he added.
Computerisation would drastically reduce various irregularities being committed owing to lack of modernisation in the banking system, Vittal said. Vittal's discussions with chief executive officers and vigilance officers of banks is targeted to strengthen vigilance and expedite enquiry processes in the banking sector.
During the discussions, it was felt that special training should be provided to central vigilance commission officials to tackle various irregularities taking place in thebanking sector.
Monday's meeting is expected to help the CVC to bring out a vigilance manual for the banking sector. Uniformity in vigilance system, speeding up investigation process and magnitude of punishment for various frauds in banks are also expected to figure in the manual.
At the meeting it was stressed that innocent officers are not harassed or punished. At the same time Vittal suggested that while delegating more power to bank officials, they should be made accountable for their actions. Under the prevailing rules, the vigilance process and magnitude of punishment differs from bank to bank for frauds of similar nature. The CVC is keen on bringing in a process of uniform code of conduct for all banks.
The CVC is keen on setting up a time frame for completion of investigation process of banks besides streamlining it. Currently, the investigation process goes on for years and even remains inconclusive in some cases.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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