Bank CEO Khatri's arrest condemned
19, Feb 2010
Bankers have strongly reacted to the arrest of Sudhir Khatri, the chief executive officer of Development Credit Bank Limited, labeling it as an arbitrary action aimed at terrorizing the banking sector.
In a strong-worded statement released at a press conference on Thursday, Nepal Bankers´ Association said that the arrest of a CEO from his office on Thursday was humiliating for someone in a responsible post.
Khatri was arrested from his office at around 2:30 pm and was released after two hours when the Nepal Rastra Bank intervened. The central bank urged police not to proceed with action without proper consultations with its experts.
Another police team had gone to arrest Ramesh Bhattarai, the chief administrator of Employees´ Provident Fund who was director of the bankrupt Nepal Development Bank (NDB). However, the team returned empty handed after receiving orders from higher authorities not to execute the arrest.
´´The arrest could have been justified had Khatri disobeyed police summons. Police had never summoned him. So the way Khatri was arrested was condemnable in strongest words possible," said Rajan Singh Bhandari, the vice president of NBA, at the press conference. The press statement has also warned that such actions could erode people´s confidence on the banking system.
Police officials said Khatri was arrested in connection with the ongoing investigation into the seven fraud cases of July 2009 involving Rs 360 million. The central bank had requested Nepal Police and Department of Revenue Investigation to investigate and punish NDB officials responsible. Khatri was associated with the bank from its inception and was general manger for three months when it came to operation ten years ago.
A central bank official told Republica that Nepal Police had asked the central bank three months ago to provide a list of all top officials who served in the bank from its inception. Hence Khatri´s name was also in the list.
The official further said that the arrest was not at all necessary as all the seven cases that NRB had requested to investigate occurred long after Khatri left the bank. The official said that central bank will again forward a name list specifying the persons who might have connections with the seven forgery cases, in order to prevent arbitrary arrests like Thursday´s.