Vigilance in Banks
During early 90’s, RBI has set up a Ghosh Committee to enquire into the various aspects of frauds/irregularities which stressed the imperative need for exercising effective control over operating units to minimize the incidence of frauds and irregularities.
Functions of Vigilance
1. Preventive Vigilance
Preventive Vigilance relates to the systems and strategy which an organization puts in use or should formulate to eliminate or minimize the potential for irregularities taking place.
The administrative offices have to ensure that timely submission of control returns take place and scrutiny thereof is taken care of.
3. Detective Vigilance
Detective Vigilance implies an intelligent check of bank’s books and records in depth. This can be achieved by the regular inspection of the branches through the inspectors.
4. Punitive Vigilance
This is an important aspect of vigilance which has its own merit and demerit and is so necessary for growth of any organization on healthy lines. Though the books have their own systems and procedures for achieving the objectives of Punitive Vigilance by conducting disciplinary enquiries.