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PNB Locker Heist Raises Key Issues of Depositor Protection

Published: 31st October 2014 06:00 AM  |   Last Updated: 30th October 2014 10:53 PM   |  A+A-

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MUMBAI: Following the daring theft that included wiping out of valuables from almost 90 lockers at Punjab National Bank’s Sonipat branch, consumer activists are seeking a review of rules that make it very difficult for locker holders to get adequate recourse in case of a theft or loss in any other manner.

PNB didn’t immediately reply to questions raised by Express. But, bank depositors expect intervention by the government, and review of policies.

“A bank cannot absolve itself of its responsibility of protecting safe deposit vaults at branches,’’ says Ashok Ravat, secretary at All India Bank Depositors Association. “In this case it is the bank that has failed to protect the valuables depositors have kept in the lockers. Depositors are not at fault.’’

Over the longer run, regulators need to review recurrence of similar cases, he said.

According to senior bankers, legally a bank customer can’t get compensation commensurate to the loss incurred in case of a theft, or any other manner. Technically, the bank customer is renting the locker at his own risk though the bank provides basic safety.

There is no insurance cover for the contents inside the locker since the bank has no idea what a customer has deposited or withdrawn, said a zonal head of a state-run bank, declining to be identified because of the sensitivity of the matter.

“There will always be an issue of what has been put in the locker,’’ said K Unnikrishnan, deputy chief executive officer of Indian Banks’ Association, adding “Such things (as theft) don’t happen on a regular basis.’’

“Each bank takes policies for its requirement and jewellery inside a locker is not covered,” said Sanjeevani Behere, a chief manager at New India Assurance Company.

Banks typically take a comprehensive insurance cover that may include protection for cash, and other valuables, most of which are owned by the bank itself, and excludes deposits made by an individual in his locker.

“Regulators must review the rules to see what can be done to insure the contents,” said Ravat. 

Suggestions include the locker-holder paying a small premium for the valuables kept inside a locker in a manner similar to taking an insurance policy.

In case of bank deposits, the maximum a customer gets in lieu of his deposits is Rs 1 lakh only in case a bank fails.

As the economy grows and depositors keep larger sums with banks, this amount too needs to be revised.



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