Bill proposes 12-year jail term to control banking crimes

In a bid to control financial crimes, the draft bill to amend Banking Offence and Punishment Act, 2008 has increased maximum jail sentence to 12 years for banking crimes. Maximum jail sentence for people convicted of banking offence is up to five years, as per the existing law. The bill has provisioned punishment in three classes on the basis of size of crime (amount). The Finance Committee of parliament unanimously endorsed the report a sub-committee on the bill of the Banking Offence and Punishment Act, 2008 on Wednesday, paving the way for the bill to be tabled in the full house on Thursday. The full house, generally, approves the bill forwarded by the parliamentary committee. According to the provision in the bill, a person convicted on banking offense with a claimed amount above Rs 1 billion will have to face imprisonment of 10 to 12 years including the suit amount and the fine equivalent to the claim amount. Similarly, people convicted with a claim amount of Rs 100 million to 500 million will be jailed for six to eight years including the suit amount and the fine equivalent to the claim amount, while the convicted person with a claim amount from Rs to 500 million to Rs 1 billion face a jail sentence from eight to ten years apart from the suit amount and the fine equivalent to the claim amount. Making unauthorized withdrawals or payments from the bank and financial institutions, obtaining or making payment by way of abuse or unauthorized use of electronic means like ATM, debit card and credit card, misusing the credit facilities availed from a bank or financial institution and deriving excess, low or false valuation, among other more than a dozen other offenses, will invoke the punishment of this level. The amendment bill has also included cooperatives under the definition of the financial system as well as the informal groups and people involved in mobilizing deposits and public funds and loans which means these will also fall under purview of the banking offense and punishment act. However, the illegal practice of money transfer 'Hundi' did not made it to the list of the offenses in the new bill. Legislators involved in the deliberations say that the Hundi practice will be made illegal by the new amendment of the foreign exchange act. Lawmakers said that their focus was toward imposing maximum fines rather than on putting criminals on jail. "Advanced countries prefer to deter financial crimes by imposing maximum fines on the convicted white collar criminals. Our focus should also be on extracting fines so that the criminal will suffer financially rather than inflicting physical trauma of jailing which also involves the cost for the government," Sher Bahadur Tamang, coordinator of the sub-committee which prepared the report on the amendment bill, said. Source: Republica