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PNB Scam Aftermath: Former Allahabad Bank CEO Removed from Service

The government will remove former Managing Director and Chief Executive Officer of Allahabad Bank Usha Ananthasubramanian from service effective today (13 August) after granting the Central Bureau of Investigation permission to prosecute, a senior government official said.

Earlier, Ananthasubramanian was divested of all powers after her name appeared in the Central Bank of Investigation’s chargesheet relating to the Rs 14,000-crore scandal in state-run Punjab National Bank Ltd. involving diamantaire Nirav Modi—the biggest in Indian banking history. She was MD and CEO of PNB till May 2017.

The government also gave permission to the CBI to prosecute Sanjiv Sharan, former executive director of the PNB, the official said.

The CBI had sought “sanction of prosecution” from the government to initiate proceedings against Ananthasubramanian and Sharan after they were named in the chargesheet relating to the fraud.

The sanction for prosecution will now help investigating agencies to prosecute these officials, the official quoted earlier said. “Prior permission of the government is needed to start proceedings against public servants.”

The Parliament had recently cleared amendments to Prevention of Corruption Act, according to which investigating agencies need to get prior sanction of the appropriate authority to prosecute government officials, including those that have retired.

Recently, the government had directed that Anathasubramanian and Sharan be divested of their executive powers. The boards of the two banks had passed a resolution in this regard in May.

(This story was originally published on BloombergQuint.)

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