Bank brass can't escape responsibility of coercion: R R Patil

The heat is increasing on those banks using high-handed methods for loan recovery.

"If banks resort to coercive methods for recovery of loans, not only their staff but the top management will be also held responsible and prosecuted," said Maharashtra Deputy Chief Minister R R Patil, who also holds the home portfolio.

Earlier last week, Prakash Sarvankar (38), a resident of Andheri (a Mumbai suburb), who had taken a personal loan from ICICI Bank committed a suicide after he was harassed and publicly humiliated by the bank's recovery agents for recovery of dues.

"I have asked the Mumbai police to investigate the matter at the earliest. There is case for applying the principal of vicarious liability and even the top management will be prosecuted for offences such as extortion, criminal trespass and abetment to suicide," he said.

So far the practice is to book the recovery agent and officials of the branch from where person has taken loan.

"It is the responsibility of senior management and officials such as chief executive officers (CEOs) and managing directors to keep control over functioning of their bank's branches. They can't escape responsibility," Patil pointed out.

"There is a model collection policy in place for banks to follow. However, in the light of the recent incidents there is a need to review it. There is a need to monitor the collection practices of banks,'' said a senior IBA official.