The directive from the Department of Financial Services (DFS) under the ministry follows several cases where negative information about board-level appointees was not promptly reported.
In many cases, it said, such critical negative inputs such as private complaints, judicial observations, references or inputs from the CBI or other law enforcement agencies are reported only at the time of specifically seeking vigilance clearance from the Chief Vigilance Officers (CVO) of PSUs.
Without citing any specific case, the advisory issued earlier this month said that in certain cases, even the crucial information related to WTDs is omitted from the Vigilance Clearance formats on the grounds that there is no specific column for such disclosure.
Observing that omission of important information, especially information relevant to decisions relating to appointments, promotions, board level posts and placement of WTDs, is a matter of serious concern, the report said, and strict compliance in such matters is expected from PSUs.
The DFS has directed banks and public sector financial institutions to immediately report adverse inputs relating to board-level officials, even if the alleged omission is in any capacity other than the board.
Furthermore, it advised them to file a comprehensive vigilance disclosure including observations or indications of the findings of the internal committees of courts or tribunals, audit observations of a serious nature and communications from any department or agency.
CVOs should ensure that the vigilance statement reflects the most current and accurate status as at the date of issuance and that no material should be omitted, it added.
Earlier this year, the government in an unusual move demoted Union Bank of India Executive Director (ED) Pankaj Dwivedi as Managing Director (GM) of Punjab & Sind Bank.
The Centre’s decision was taken following a pending case in the Delhi High Court.
The court has held that his appointment as executive director of Union Bank of India was in violation of regulations due to lack of vigilance.
Published on December 28, 2025
#FinMin #asks #banks #financial #institutions #prompt #reporting #vigilance #issues