Public Has A Right to Know the Frauds Committed on Banks - CIC Gives Its Decision

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We have noticed that in recent days there is a trend wherein Banks try their best to deny the information under Right to Information Act on the plea of confidentiality or not in the public interest. Till recently, banks have been denying the information asked for frauds. However, the recent judgments by Central Information Commission indicates that they have upheld the right of citizens for transparency in number of matters and banks have been asked to submit the required information. In one of the recent judgements, CIC has clearly stated that public has a right to know the details of the frauds committed on bank either by its own staff or the public. Thus, anybody who wants to know the details of frauds can now approach the respective bank to get the desired information. We give below the details of the recent judgment on this subject.

Central Information Commission, New Delhi
File No.CIC/SM/A/2011/000020 Right to Information Act2005Under Section (19)

Date of hearing : 29 December 2011 :

Date of decision 29 December 2011 :

Name of the Appellant Shri H. Basavraj S/o. Basappa, #2954/4, MCC, B Block, 5^th Cross, 5^th Main, Davangere - 4.

Name of the Public Authority : CPIO, Canara Bank, Strategic Planning & Development Wing, Head Office, 112, JC Road, Bangaluru.

The Appellant was present.

On behalf of the Respondent, the following were present:

(i) Shri S.R. Sridhar, AGM,

(ii) Shri Swaranabha Koduse, Senior Manager,

(iii) Ms. Malini, Manager

Chief Information Commissioner : Shri Satyananda Mishra

2. The Appellant was present in the Davangere studio of the NIC. The Respondents were present in the Bangalore studio. We heard both their submissions.

3. The Appellant had wanted all the details about the cases of fraud, embezzlement and losses in the bank as on 30 March 2010. The CPIO had
refused to disclose the information on the ground that it was exempt under Section 8(1) (d) being in the nature of commercial confidence. The Appellate Authority had endorsed this decision of the CPIO.

4.            During   the   hearing,   the   Respondents   submitted   that   they   did   not maintain the information in the form the Appellant had sought. They further
submitted that since the Appellant had not specified any time limit or office   where such fraud etc might have taken place, compiling the information for the
entire   bank   for   an indefinite   period   ending 30 March   2010   would   be   an impossible   task   since   the   details   about   such   cases   were   not   centrally maintained. Besides, they also argued that the disclosure of the information relating   to   cases   of   fraud   and   embezzlement   would   adversely   affect   the reputation of the bank and might impact its competitiveness in the market. Therefore, they were of the view that such information should not be disclosed. On this, the Appellant submitted that since the bank was mandated to send reports about such cases to the RBI every year, it should be possible for the bank to provide him the desired information as on 30 March 2010, that is, the date on which such a report might have been sent.

5.         After carefully considering the submissions of both the sides, we are of   the view that whatever information the bank may have centrally on the subject,
possibly in the form of any report they might have sent to the RBI, should be disclosed. To claim that cases of fraud and embezzlement must be kept under
wraps to protect the reputation of the bank cannot be accepted as it flies in the   face of practice of transparent methods which is expected of every public
authority. Such cases cannot be   classified as   information in   the   nature of   commercial   confidence.   The   public   has   a   right   to   know   about   such   acts
committed in the bank either by its own employees on their own or by others   independently or in collusion. In fact, the disclosure of such information would
alert everyone, both inside and outside of the bank, to be more watchful and prevent such acts in future.

6. Therefore, we direct the CPIO to provide to the Appellant within 10

working days of receiving this order a photocopy of the consolidated

report/information regarding the frauds, embezzlements and losses as on 30/31

March 2010, in whatever form available.

7. The appeal is disposed off accordingly.

8. Copies of this order be given free of cost to the parties.

(Satyananda Mishra)

Chief Information Commissioner

Authenticated true copy. Additional copies of orders shall be supplied against application and payment of the charges prescribed under the Act to the CPIO of this Commission.

(Vijay Bhalla)
Deputy Registrar