CVC refuses to give vigilance nod to top public sector bank appointments

NEW DELHI: The Central Vigilance Commission has refused to grant vigilance clearance to the latest list of those recommended to the post of executive directors in public sector banks, until the government clarifies its position on the names.
Sources said the CVC has asked the government to clarify if it endorses the latest list of candidates. The move comes on the back of concerns about irregularities in top level appointments to PSU banks after the Syndicate Bank scandal.
The ED appointments have seen ‘back and forth’ communication between CVC and the banks, and now the entire process has been escalated to the ministry level.
The CVC has written to the department of financial services- the administrative ministry for PSU banks — asking it to clarify about its stand on the selection of new EDs. The CVC has cited newspaper reports that said the finance ministry has decided to take a relook at the recent appointments of senior level PSU executives.
Finance minister Arun Jaitley had recently written to cabinet secretary Ajith Seth and RBI governor Raghuram Rajan, asking them to review the recent appointments. While RBI governor is the head of the appointment board that selects chiefs for state-run banks, the cabinet secretary processes the papers for the appointments committee of the cabinet.
The finance minister is believed to have asked them to look at some of appointments processed during UPA's last weeks that appeared to be lacking transparency.
Jaitley’s letter was prompted by CBI findings in its investigation into the Syndicate Bank loan scandal, in which it arrested bank’s CMD SK Jain, Bhushan Steel’s vice chairman Neeraj Singal and some others.
CBI chief Ranjit Sinha told the finance ministry that the agency has noted irregularities in senior level appointments during the investigations. CBI had suggested a scrutiny of senior level appointments since it had stumbled upon evidence, indicating that ACRs and interviews were manipulated in some cases. The CBI also suspects that some middlemen may be involved in such manipulations.
The candidates are selected on the basis of marks totalled from both confidential reports (ACRs) and interviews. It is suspected that both the marks were “dramatically altered” to favour certain candidates.