by Elton Gomes
Former Supreme Court judge, B.N. Srikrishna will head an inquiry panel probing whistleblower Arvind Gupta’s complaint alleging breach of conduct, conflict of interest, and quid pro quo by ICICI Bank Chief Executive Officer Chanda Kochhar.
The bank had stated that it would be placing an inquiry to investigate the accusations at the end of May. A person privy to the matter told the Economic Times, “The board felt he would be the best person to conduct this inquiry. He has accepted the request.” The source also expressed confidence in Srikrishna’s credibility,“ Justice Srikrishna is an independent and credible name, who has a good understanding of the financial markets.”
The bank’s board has said the independent probe will employ forensics, review emails, and record statements of relevant personnel. The bank said in its exchange filing, “The enquiry would also cover all connected matters in the course of the investigation to bring the matter to a final close.”
Here’s what happened
On May 31, the Economic Times reported that the bank’s board had ordered an independent inquiry into fresh allegations against Kochhar. The report mentioned that the bank was planning to complete the probe while Kochhar was on her annual vacation.
A person knowledgeable of the matter told the Economic Times, “At the moment Kochhar is on her annual leave. It has been timed accordingly so that there is no interference and the board doesn’t have to tell her to step aside during the period of investigation.” The source added that Kocchar’s absence was irrelevant, “These things are completely documented. Whether she is present or absent does not make any difference, you cannot change these records as they are all computerized.”
Persons aware of the developments said that the bank’s board met to discuss appointing a law firm and a forensic auditor. The discussions took place after fresh allegations of quid pro quo deals were levied against Kochhar.
On June 8, Business Today reported that whistleblower Gupta claimed that Kochhar had favoured Ruia brothers of Essar Group by ’round-tripping’ investments into her husband Deepak Kochhar’s firm NuPower.
Gupta wrote a letter to Prime Minister Narendra Modi on May 11, wherein he claimed that the Ruia brothers funded NuPower and its subsidiary through their son-in-law Nishant Kanodia and nephew Anirudh Bhuwalka by “subscribing to compulsorily convertible preference shares and equity shares.”
Kochhar’s future at ICICI
Kochhar and ICICI Bank have constantly been in the news for some time now. The bank’s reputation as India’s largest private sector bank has been tarnished in the wake of several cases of fraud.
After Axis Bank CEO Shikha Sharma cut short her tenure after the RBI raised doubts, many experts claimed that Kochhar might be the next to step down. LiveMint reported that directors on the bank’s nomination panel were preparing a succession plan, according to people privy to the matter. Thr source added the panel might appoint a headhunting company to finalise a new CEO.
Elton Gomes is a staff writer at Qrius.
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