As many as 15 officials and employees of public sector banks and LIC have been suspended following Cobrapost’s allegations of money laundering. Further, six officials have been sent on leave, 10 divested of work, and two LIC agents barred.
The Enforcement Directorate is unlikely to investigate the allegations made by Cobrapost on May 5.
On the basis of its sting operation, the portal alleged that 23 banks and insurance companies were involved in money laundering. These banks include the public sector State Bank of India, Bank of Baroda, Punjab National Bank and Indian Overseas Bank, . Also mentioned was state-owned insurance company Life Insurance Corporation.
On Tuesday, the Finance Ministry gave out details of the action taken by these banks and LIC. It said that, besides suspension and forced leave, 10 officers in various public sector banks had been divested of their work. “More action-taken reports are expected in the near future,” it added.
On Monday, Financial Services Secretary Rajiv Takru asked Chairmen-cum-Managing Directors (CMDs) of various PSU banks and LIC to take immediate action in the matter.
Compliance reports
The Secretary also sought compliance and action-taken reports on utmost priority. As a result, certain PSU banks have already taken action and, in some cases, work is in progress, the Ministry said.
According to sources, Canara Bank has suspended three officials named in the expose, while Indian Overseas Bank, Punjab National Bank and IDBI Bank suspended two officials each. Bank of Baroda, Oriental Bank of Commerce, Indian Bank, Corporation Bank, Dena Bank and LIC suspended one official/employee each.
The suspended officials ranged from the level of Assistant General Manager to Manager.
Sources said the Finance Ministry was not satisfied with the report filed by the SBI, which sent four of its officials on leave. The Ministry has sought suspension of these officials. However, it did not react to a report by Allahabad Bank, which found none of its officers or employees were doing anything wrong.
A senior government official said since no transaction had taken place in the sting operation, no offence had been committed and the ED was unlikely to probe the matter. The investigating agency does not usually investigate matters suo motu , he added.