A
case has been filed against the anti-graft body today claiming that interfere in the private banks
and financial institutions does not fall
under Commission
for Investigation of Abuse of Authority (CIAA) jurisdiction.
An advocate Arjun Kumar Aryal has filed a case at the Supreme
Court claiming that the CIAA has no right to seek information directly from the
banks and financial institutions. "The CIAA move will not only have
negative impacts on banks and financial institutions but also have adverse
impact on overall economy," Aryal claimed, adding that the banks and
financial institutions come under the central bank's jurisdiction. "Only
Nepal Rastra Bank Act 2058 BS has the right to regulate the banks and financial
institutions."
The CIAA has been trying to tame and terrorise the financial
sector going out of its jurisdiction, he has claimed.
On Monday, a private sector representatives
– including bankers – have met central bank governor DR Yubaraj Khatiwada and
expressed serious concerns over the CIAA's demand of details about borrowers of
banks and financial institutions.
They have informed the governor of adverse affect after the CIAA interference. "The CIAA move could affect domestic and foreign investment
in the country," they have added.
The CIAA has been seeking details of loans, share ownership,
foreign investment and exemption of penalty and interest amount to recover the
loans, from about a dozen commercial banks.
The Bank and Financial Institution have provisioned that they should
maintain the customers’ information secret, and the CIAA move will send
negative message.
The central bank has also failed to resist the anti-graft body's move despite being an autonomous regulating authority of the banks and financial institutions.
The central bank has also failed to resist the anti-graft body's move despite being an autonomous regulating authority of the banks and financial institutions.
Aryal claimed that clause 79 of the Bank and Financial Institution
Act 2006 allows the banks and financial institutions to provide the details
about accounts of a person, firm, company and institution and licensed
institutions, if the Finance Ministry and the central bank direct them for any
specific investigation by disclosing the reasons for demanding the information.
The CIAA has been seeking
details from the government-owned banks directly, and private sector banks
through the central bank about the borrowers that received loans over Rs 10
million.
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