The real defaulters are those who borrow crores

Eight cases of harassment during loan recovery have been registered in the
past year. But these are just small fry. The main problem lies elsewhere,
says Commissioner of Police DN Jadhav

What steps has the police initiated to ensure there is no harassment by recovery agents from banks?
After the Prakash Sarvankar [suicide] case, I called for a meeting with different private and public sector banks, agents, recovery agencies and about 75 people shortlisted by our Economic Offences Wing.

The idea was to find a solution. I told the gathering on Thursday that we had seen eight cases of harassment during recovery this year — which does not speak well of the banking industry.

I don’t deny the importance of banking in India’s economic sector. The industry is growing fast, and loans have a vital role to play in agriculture, industrial and infrastructure development. But we do need to bring some balance to the system so that banks don’t risk their reputation, or get on the wrong side of the law.

What is the framework of guidelines regarding the cases that have been registered?
I also mentioned in the meeting that loans taken in the eight cases were paltry amounts — all less than Rs50,000. The real defaulters are those whose loans run into crores of rupees. Banks are not hurt by the Rs50,000-defaulters, but by the big fish. But we are more concerned about the small borrower than the big one, which is the real problem.

What action will you take against the three agents who were arrested in the recent loan recovery case? Will they be booked? And if so, under what sections?
The sections will depend on the facts of each case and the nature of the FIR filed. For example, if someone claims the recovery agent confiscated a vehicle, then that might become a case of theft.

If there are complaints of threats, it could come under Section 506 of the IPC. Then there are cognisable and non-cognisable offences. If it’s cognisable, it will come under the purview of the CrPC. If non-cognisable, we will have to proceed as per the court’s directive.

We would like banks to employ only well-known agencies. The agencies should, in turn, make sure their employees have no criminal records. The police can help them select the agency and prospective employees by verifying their antecedents, in return for a nominal charge. The core team is in the process of formulating these norms.
 
People feel the police have not taken sufficient action against these offenders.
We have registered eight offences. This cannot be termed inadequate. We are not going to shout from the rooftops about the measures taken.
 
There is also public outrage over the idea that the police do not take action against banks because the top bosses are influential people.
We have urged the banks to be more careful about selecting their recovery agents. But whether or not the top bosses of a bank are to blame, depends on the facts of the case.

There have been instances of over-enthusiastic employees getting carried away, but not every incident involves the top man or calls for his arrest. In one case, we did arrest the bank’s top person. We want to bring some sanity to the system and will be happy if that happens without our intervention.

Are the police sensitised enough to handle such matters?
We refer to the IPC when investigating such cases, and I would say the police are adequately sensitised to this issue. But we do plan to hold workshops on the recovery problem to increase sensitisation.