The finance ministry has directed public sector banks and financial institutions, including insurance companies, to ensure prompt reporting of vigilance-related matters concerning whole-time directors (WTDs), citing repeated instances of delayed or incomplete disclosures, PTI reported.In an advisory issued by the Department of Financial Services (DFS) earlier this month, the ministry said adverse information about board-level appointees was often reported only when vigilance clearance was specifically sought from the chief vigilance officers (CVOs) of public sector undertakings.The DFS noted that critical inputs — including private complaints, court observations, references from the CBI or other law enforcement agencies — were, in many cases, not disclosed at the appropriate stage. In some instances, crucial information relating to WTDs was omitted from vigilance clearance formats on the ground that no specific column existed for such disclosure.Calling such omissions a matter of “serious concern”, the ministry said strict compliance is expected from PSUs, especially as such information has a direct bearing on appointments, promotions, board-level postings and placement of whole-time directors.The DFS has asked public sector banks and financial institutions to immediately report adverse inputs relating to board-level officials, even if the alleged lapse pertains to a role held in a capacity other than a board position.It also directed entities to ensure comprehensive disclosures in vigilance clearance submissions, including observations or directions of courts or tribunals, findings of internal committees, serious audit observations and communications from any department or agency.Chief vigilance officers have been instructed to ensure that vigilance clearances reflect the most updated and accurate status as on the date of issuance, and that no material information is suppressed.Earlier this year, the government had taken the unusual step of demoting Union Bank of India Executive Director Pankaj Dwivedi to the rank of general manager at Punjab & Sind Bank. The decision followed an ongoing case in the Delhi High Court, where it was alleged that his appointment as executive director violated regulations due to the absence of vigilance clearance.
