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ICICI pays compensation to suicide victims' family

Mumbai, Fri, 28 Sep 2007 NI Wire

Newstrack India

Sep 28: After the ten days of suicidal death of Prakash Sarvankar (38), who blamed ICICI recovery team for molesting and threatening him and his family in his suicidal note, ICICI has now decided to provide some relief to pay ex-gratia of total Rs. 15.50 lakh to his family.

ICICI Bank has announced to pay off Rs 15.50 lakh through different ways. Rs. 10 lakh would be paid in the form of fixed deposit for 59 months through which the survival family will get Rs. 9,500 per month while a family insurance policy worth Rs. 20 lakh would cover the three daughters and a wife of the Sarvankar for 20 years.

Besides these a medical cover worth Rs. 4 lakh for Prakash’s wife Priyanka while his three daughters will also get medical covers worth Rs. 3 lakh each. All these medical coverage are cashless and takes care of all hospitalisation expenses. Priyanka though is not satisfied for all these saying that “all these can not return my husband”.

On the other hand Banking Codes and Standards Board of India (BCSBI), an arm of Reserve bank of India has also questioned over the roughness of recovery team and asked to ICICI bank about not to follow the ‘Code of Banks' commitment to customers’.

According to sources, BCSBI has taken this matter seriously and not willing to end this matter only till compensation. It has also asked in written to ICICI bank for what action taken against the agency that was providing recovery service that bank. It has also asked why bank has not arrested any one from its branch except suspending the accused agency.

Six month before Prakash Sarvankar has credited loan sum of Rs. 50,000 but could not repay it due to illness and unemployment. The alleged recovery team has taken some harsh step to recover the money, but could not get succeed. It began to threaten them, thus makes Prakash so depressed, and he had to commit suicide by hanging himself at his Andheri residence as said Prakash’s wife to the reporters. Prakash has left Priyanka (wife) who is working as a security guard with an agency at Seepz and three daughters, Pranita (9), Prajakta (6) and Prachi (3).

However, as loan default is becoming a common problem for financial institutions it was important from their point of views to use professional recovery agents to recover dues from customers. But the Supreme Court has criticised strongly against the use of recovery agents as some of the individuals are of criminal background. After long customer’s complaints regarding the adverse recovery practice the SC had directed RBI to formulate some guidelines.

In such cases though it is every right of banks to recover their loan amount but as per the Supreme Court judgement they can’t send goondas to harass defaulters and their families. It is in usual case that the agents get commission and hence most of time use muscle power. But as per the guidelines of RBI and Indian Bank Association it’s in now for all banks to check thoroughly the background of recovery agents and make police in verification. The banks also have to publish details of its recovery agents in the official websites.

Meanwhile, representative of different banks and other financial institutions have decided in a meeting to come up with a common guideline for recovery agents which will have to be strictly followed.

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