Banks start investigation process of money laundering allegations

NDTV Profit Desk

16 Mar 2013, 07:58 PM IST

Days after a sting operation purportedly show bank officials help launder money, HDFC Bank today said it has hired independent audit firm for conducting forensic inquiry while Axis Bank initiated a probe into the matter.

"The bank has appointed accounting and audit firm Deloitte Touche Tohmatsu India to carry out an independent forensic enquiry into the allegations and reported statements, as made by Cobrapost representatives, when secretly taping bank officials," HDFC Bank said in a statement.

Besides, the bank has also appointed Amarchand & Mangaldas & Suresh A Shroff & Co to examine the breaches, if any, of the bank's Code of Conduct & Ethical Standards, by any bank officials, it said.

The bank has also suspended 20 officials concerned till investigations are completed, sources said.

Meanwhile, another bank named in the sting operation -- Axis Bank -- said a thorough internal enquiry is already underway to look in to all aspects of the matter and the findings are expected shortly.

Pending the enquiry, the bank has advised 16 employees concerned to report to respective administrative offices, Axis Bank said in a statement.

Yesterday, ICICI Bank suspended 18 officials concerned till investigations are completed.

Earlier this week, the portal Cobrapost had played the contents of a purported video recording of officials of private banks including Axis Bank, allegedly agreeing to receive unverified sums of cash and put them in their investment schemes and benami accounts in violation of anti-money laundering laws.

The footage taken in 'Operation Red Spider' purportedly shows a number of senior executives of the three banks verbally agreeing to take huge amounts of cash from the undercover reporter and putting them into a variety of long-term investment plans so that the black money ultimately is converted into white.

However, neither any account was opened nor any cash deposited in these banks.

Soon after the revelation, the bank in a statement had said: "Axis Bank has systems and processes that are robust and fully compliant with extant regulations...we are confident that all our businesses will live up to the high standards we have set for ourselves as a bank."