ASHWINI A. writes from Bangalore: If a person is known by the company he keeps, how does one know a company?
Perhaps by the persons it employs?
Another day, another morning, and there is yet another story in the papers of an ICICI Bank customer, this time in Hyderabad, being mentally and physically roughed up by hired goondas of the Bank which, like so many other banks, outsources its defaults payment collection to a private firm and keeps its cost-conscious conscience clean.
Nothing surprising, maybe, to those who believe this is the only way of collecting dues in a land of compulsive defaulters like ours.
Nothing surprising, maybe, to most people who have become used to the strong-arm tactics of goondas who drive away defaulters’ cars at traffic signals.
And nothing surprising, maybe, to most people who have become helpless at the hands of the police and judiciary which conveniently look the other way.
Except…
Except that all the action of the white-collar thugs in this case was directed at Y. Yadaiah, a 42-year-old hapless Andhra government employee, who had borrowed a princely sum of Rs 15,000 from ICICI Bank, which last week collected Rs 20,000 crore in a Follow-on Public Offer.
And except—sorry to bother you with this small detail, Mr Kundapur V. Kamath—and except that the man passed away/ breathed his last/ died shortly after making a call to his wife stating that he would not be allowed to come home till he returned the Rs 15,000.
Yes, dead and gone. Probably because of the treatment meted out to him by the goondas. Probably out of humiliation. But yes, dead and gone.
ICICI Bank, of course, fantastically claims that Yadaiah himself had gone to the recovery agent’s office on his own to make the payment for the overdue instalments.
“We are informed that during the interaction with the representatives of the agency he felt unwell and requested to be accompanied to a doctor. We are further informed that the agency representatives had provided all possible support for his medical treatment.”
Yadaiah’s widow and the Police have a different story to tell. But no arrests have been made by the police despite the fact that the person died in illegal custody.
And no arrests have been made despite the tacit admittance of its guilt in the matter by ICICI Bank which, stung by the controversy—not genuine regret, remorse or other such human emotions—has announced a compensation of Rs. 15 lakh for the victim’s family.
Should not there be a law to tackle this goonda raj?
Is a loan—that is usually forced upon customers by credit card companies and banks—a ticket to torture and trauma (and death if one is less fortunate)?
And Mr Kamath and his whizkids who are so happy launching IPOs and FPOs and rubbing shoulders with the Prime Minister and other stars of the galaxy, we have just one question: do you sleep well at night?
Related story: Thugs’ recipe for loan recovery
I see this to be the biggest risk for indian banking industry. I think the central bank should define guidelines for recovery of impaired loans.
Some of these new generation banks have earned notority for sending goons to collect loans. This is not the first case against ICICI. The Supreme Court has sternly warned it in another case: 2007 SCCL.COM 204(Case No: Civil Appeal No. 267 of 2007)
Manager, ICICI Bank Ltd. Appellant versus Prakash Kaur and Ors. Respondents
Date of Decision(mm/dd/yy): 2/26/2007.
Judge(s): Hon’ble Mr. Justice Dr. A.R. Lakshmanan and Hon’ble Mr. Justice Altamas Kabir.
Subject Index: Bank recovery — all are governed by a rule of law in the country. The recovery of loans or seizure of vehicles could be done only through legal means. The Banks cannot employ goondas to take possession by force — appreciate the procedure adopted by the Bank in removing the vehicle from the possession of the writ petitioner. The practice of hiring recovery agents, who are musclemen, is deprecated and needs to be discouraged. The Bank should resort to procedure recognized by law to take possession of vehicles in cases where the borrower may have committed default in payment of the installments instead of taking resort to strong arm tactics.
——————
I do not support what ICICI does. I happen to be a customer of this bank and have been at the receiving end of their “customer friendly” practices. The sooner banks like ICICI are taken to task and fined heavily (with criminal charges against top management) the better for everyone. What we need are clear laws on these issues.
However, the original post makes the assertion that these loans are forced upon the consuner. This is the dumbest thing I have ever heard. I work in banking and have heard many stories about how financial institutions exploit customers, but have never come across such a gem. So how does this “force” work? The bank employee/credit card salesman strongarms the consumer into signing the papers? If that fails, a bundle of banknotes is thrust into his pockets? Give me a break.
……”Is a loan—that is usually forced upon customers by credit card companies and banks—a ticket to torture and trauma (and death if one is less fortunate)?”
As Gokulam stated – without knowing complete facts nor excercising one’s common sense, you are erring in making a blanket statement. Forced/Fraud/Enticements…phew!!..seems like a theme out of 80’s Bollywood movies with simple themes of good vs bad, rich vs poor which strike a chord with the masse……are we dealing with grown up folks, who can make prudent financial decisions to take a loan or not?
……”And Mr Kamath and his whizkids who are so happy launching IPOs and FPOs and rubbing shoulders with the Prime Minister and other stars of the galaxy, we have just one question: do you sleep well at night?”
Do I smell jealousy here?? Sarcasam aside, of all the interactions that occur between ICICI and its customers- what % could be categorized as “harrassment/coercion/goonda raj affected”??? If its as prevalent and widespread, as its being suggested in this article, I bet customers would have moved to ICICI’s competitors in troves. Is that happening? Definitely not. Employing a handful of egregious incidents to wrongfully misrepresent the entire business entity is plainly wrong. If not more, its equally repelling.
this is a sincere request as well as a plea to my friends, based on my personal experience as well as that of my doctor friends, never transact with ICICI BANK.
if same incidents were to take place in other countries , promoters of bank would be behind bars, but india this is, they are role models.
Suraj,
I agree….forced loans are a stupid thing….no own can force you to that…
BUT….you cannot look at percentage of issues….this is not like % of successful operations…..right?…it is about money/banking…and there is a legal framework…even if banks give personal loans without collateral…they charge you more as interest…to offset bad debt…(credit cards are better examples)….
I think it is nastry…even if it is one case irrespective of total number of cases…and bank needs to be pulled up….
coming to ICICI, I am their customer…and I don’t think they care much about customers….like many other banks….in fact I cleared a car loan last year and they gave me the release documents (forms for RTO) and NOC that have my previous car registration number (for which the loan was in HSBC)…and nearly an year, I am yet to see it sorted….
I have had an equally bad experience in dealing with ICICI. They are also in the habit of deducting small amounts from the customer’s savings bank A/C without providing adequate explanation. Other private banks like HDFC are a lot better managed.
ya naysayers… get a personal loan from the bank, miss paying an installment and get back to comment here after that.
Crime Diary had a scary story where an auto driver was assaulted for missing three installments, the bank coolly put the blame on its agents saying they had nothing to do with such treatments.
I bet ICICI bank has such an agreement that forces their agents to resort to these unruly means, if they don’t collect, they lose the agency or at least the commission. They have to be accountable too!
defenders of ICICI Bank… have you invested in them? :P
The question here is not whether it is legal or illegal. If banks like ICICI are correct in using anti-social means for recovery to improve their collection performance, ‘Jana’ have right to extend ‘goosa’ to all the stake holders-bank officicals responsible for hiring the ‘Annas’, collection team responsible for collection, agent representing bank, police protecting unlawful activities of the bank, intellectuals supporting the immoral behavior – alike to assert their right for survival. 3% interest (in credit cards) on prompt payers cover all the default losses. Can you cite same method is used by a public sector bank? How they can be different?
I do not want you offenders and their supporters be kind and compassionate. I want you to be legal. If you can not be legal, why you cry foul when you are attacked mercilessely?
Gokulam 3rd Stage, your observation on how a loan can be force on customer.
I was victim of one such loan while in India. Let me explain what is “forced” here.
Agents typically promise lot of things verbally. One agent had misunderstood “deferral” as “cancellation”.
The scheme in print was like this
You get 46K loan now and return 4K in 13 installments. First installment is deferred.
What Agent explained to me was like this.
You get 46K loan now and return 4K in 12 installments. (Agent thought that deferral meant cancellation) There was no document I could read because agent did not have any document and he promised to send me one later.
I signed up believing what agent said and was surprised to read the deferral clause one week later. When I got back to the bank.. bank said customer acquisition was outsourced and agent made an error in giving that impression. But bank refused to cancel the loan and take back whole amount which was just deposited in my account and went on to send a goon to my home when I refused to pay the 13th installment.
I beat up the goons and left India. :-).
It always happens in India.
Narayana, it wasn’t force. It was cheating. And you fell for it. Caveat emptor. I hope you don’t agree to anything now without looking at the paperwork :) If agent doesn’t have the paperwork now, I am not agreeing now. Correct?
> I am Partha Kempanna. I am in USA pursuing PhD here. I have an NRE account with ICICI bank since may 2004. ICICI claims that I have a credit card with them. And I have used about Rs 36000 from it in June 2004 in India, while I was in USA. I am in USA from Jan 2004 till now, except for between Aug 6th and Sep 4th 2005, when I came to India for summer vacation and between Feb 7th and Feb 14th 2006 for sister’s wedding. I have not received any credit card from ICICI bank nor I have used any money from them. On 6/25/07 there was Rs. 8860.16 in NRE account. They have removed all the money made it zero balance and say this was taken towards the credit card.
I have sent several emails to their customer service representatives. NO REPLY. I have send more than Rs 10 lacs from USA to this NRE account. If I was guilty minded of using Rs 36000 from ICICI CREDIT CARD in june 2004, I would not have opened NRE account with ICICI in the first place! There is no logic in their act.
It is not the question of my Rs 8860.16 and the way ICICI bank has removed my money. This is encroachment of my property.
I am not sure if people have overlooked the fact that in India the severity of treatment for default is inversely proportional to the amount of the loan.
Aside, there would have been an outpouring on joy if MV Kamat had been chosen as the presidential candidate instead of PP?
In some advanced countries if you default even small amounts on loans (even delay payments by some time), your credit rating goes lower. Once that happens, your life becomes a nightmare. The goonda system is just another parallel system in the absence of credit system which kills defaulters slowly but surely…
@Anonymous guy
“In some advanced countries if you default even small amounts on loans (even delay payments by some time), your credit rating goes lower. Once that happens, your life becomes a nightmare. The goonda system is just another parallel system in the absence of credit system which kills defaulters slowly but surely…”
There is a correction in your statement, its not “In some advanced countries”, its “All civilised countries.” These countries said if you bankers want to do business, you need to follow legal system and pay for re-enforcing the legal system decades back. This prompted the bankers to call the private agencies via EXPERIAN, EQUIFAX and TRANSUNION to maintain the credit history of all the individuals (under the FAIR act in USA). This maintainance cost of credit histrory by private agencies is and rightfully borne by the bankers / credit card co..
If this can be done in other countries why can not do in our country?
A. Bankers do not want to take the overhead of mainitaining this credit system.
B. Bankers do not want to pay the govt. as tax for re-enforcement of the legal system, instead lobby the govt. men to change the policy in bankers interest. Which it should be in the interest of the common man, like you and me.
C. Bankers do not want to wait on the lenghty process of establishing this credit system.
D. Bankers want to run parallel legal system, which is not bound by any “human ethics”. Harass, Steal n KILL for money.
Govt. is not resposible for establishing the credit system, but it should be the bankers who should do it; for all you know bankers are the ones who are making the profit. Govt. should not allow the creditors to lend money without the credit system, which SADLY is not happening in India.
Bottom line – BANKERS want to make profit no matter what. I pretty sure you are one of the ICICI bank employee with lack of common sense and full of pride (stupid arrogance) that you are an employee of a GREAT bank, ICICI.
Dude, this is eventually going to lead to the social and economical instability of the country. When legal and judicial system fails, country will not survive for a longtime. When you will also victim of your own ignorance.
Bankers almost con common folks into taking their credit cards. Cards are distributed like pamphlets without any background credit check of the recepient. When some of the invariably default, the banks go after them with collection agents by their side. This causes interest rates in the entire system to rise and consequently everyone is affected. The banks are not bothered about this. All that they care about is their bottom and top lines. They dont have a regulatory system to judge who is eligible for credit cards since it will add to their costs and bring their profits down. Their greed makes the honest middle income man pay through his nose for credit. With rates rising sky high, he has no option anymore.
“So how does this “force” work? The bank employee/credit card salesman strongarms the consumer into signing the papers? If that fails, a bundle of banknotes is thrust into his pockets? Give me a break.”
@G3S – Credit card cos in India do indeed “force” a loan on you. Well they dont acutally stuff a wad of notes into your pocket but they do something eerily similar. Here is how it works. You graduate out of college and hit the jackpot in some “software” company. The company opens an account for you in ICICI/Citibank etc.,. A month or a few months later once you’ve had a few pay stubs, you get a “pre approved” offer in the mail. In the US, I’d take it straight to the shredder. The shredder does the rest and that is the end of my worries.
In India however, it takes a sinister turn. Regardless of whether you open that mail or shred it or ignore it, you are in punkd unless you inflict upon yourself the pain of calling them, holding for half an hour and telling them that you choose to ‘decline’ their “pre-approved” offer. In short, unless you “decline” it, you bought it! And a month later, the bills start coming. You ignore it thinking its more “junk” mail. Few months on, the “collection agents” come knocking…. What happens after that is anybody’s guess.
In short, in the land of “pavaaDas”, you dont have to so much as ‘apply’ for a card for it to haunt you. Your ‘prarabdha’ is enough to ensure that it does.
Note: I never applied or used a credit card in India. This info however, is collected from reliable sources with first hand experience.
To,
Shri, Mr. Kamath,
Dear sir, I have experience In verious Bank recovery, Seizing ,new Case disbursment Etc
Example.SBI,Bank of Maharastra, HDFC Etc.
I required Recovery work, Personal Loan Frenchaisee for Yavatmal,wardha and Amravati, for Maharastra. Dear sir please Copprate to us.
Regard
Santosh p. Marolkar
Unique Associates Nagpur
Mobile -09326611104 09372611104
Yah as many told that it hapens in india,
like other news this news also vanished from media after a day because India is a big & and populated country no matter lasts long.
bt i am sure that icici wl kip on killing people in ds way.
Sometimes it is a matter of conscience also. Giving out credit cards to incompetent customers is somewhat equal to putting a small baby at the edge of a cliff.
Why is RBI sleeping criminally against these white collared, wide spread, large scale frauds committed against crorores of India by ICICI and ICICILombard ? What is G Kamath doing except promoting his new programmes to entice people. No wonder ICICI has the higheset profit ratio, from monies looted from croroes of people.
I fully agree with you. Following case of mine is also of cheating by ICICI bank.
I want to bring to your knowledge that the ICICI bank and its Chairman, the Wholetime Directors, Officers and staff members, having office at Videocon Tower, 2nd Floor, Block E-1,Jhandewalan Extn., New Delhi-110055, have cheated me and are depriving me of my hard earned money and have breached the trust, which an innocent lady like me had in an institution like ICICI Bank. Since the Bank and its Chairman, The Directors, Officers and staff are very powerful and resourceful and I being a fragile lady, am being harassed also.
The fact of the matter is that in December, 2007, I decided to buy a car and the representative of the bank lured me by his sweet talks and I being gullible lady came under his influence and applied for a loan of Rs. 6,57,000/-. The terms of loan as told by the said representative were as follows:
1. That Loan shall carry the interest of 8.75% per annum.
2. That based on 8.75% the EMI for 60 months works out to Rs. 13,664/- per month. (This information/calculation was believed as correct as it was coming from a bank like ICICI bank).
3. That I have to give one advance EMI alongwith the application for loan to the seller of the car.
4. That I have to pay Loan processing charges of around Rs. 3500/- and which payment shall also be made in the name of the seller of the car.
Accordingly I signed the blank booklet containing various documents and paid the required charges, advance EMI and the difference of the cost of the car and loan amount to the seller of the car. I received the car and after a few days, I received an amortization schedule (repayment schedule), the terms and conditions and also a pamphlet from ICICI bank,
which amortization schedule showed that the loan amount is 657,000/-, after adjusting Advance EMI, the principal outstanding is Rs. 6,43,336/- and after paying first EMI consisting of principal amount of Rs. 8,898/-, instead of reducing the outstanding amount of Rs 643,336/- by Rs. 8,898/- i.e. to Rs. 634,438/-, the principal amount was consciously inflated to Rs. 644,293/- in such a way that the mischief/criminal intention cannot be detected unless the document is thoroughly studied.
Also inspite of my various requests, I have not been provided with the copy of the agreement, which was a part of the booklet which I had signed blank.
Since the amortization schedule had come from a big bank like ICICI bank, I did not check the amortization schedule thoroughly and started paying the installments, which I am regularly been paying intime till date. On one day, when I was going through the amortization schedule, I noticed the abovesaid discrepancy that the principal amount outstanding after the payment of first EMI due on 10.02.2008 is inflated by Rs. 9,855/-. I thought that it must be an error and therefore I innocently and immediately brought this error to the knowledge of the bank and the bank instead of rectifying the error sent me a fudged/falsely created document stating that there was an element of some charges amounting to Rs, 9,855/-, therefore the principal is inflated. However in the said document, the bank correctly mentioned that the loan carries an interest @ 8.75% on the loan. I then calculated and found that not only the principal has been inflated but the EMI is also inflated. I brought this also to the knowledge of the bank through Ms. Namrata and Mr. Karan Singh (employees of the bank who were attending to my complaints) and requested them to rectify that error also. To my utter shock, in a further attempt to cheat me, the bank sent me yet another repayment schedule mentioning that the loan carries an interest rate of 9.41% per annum to justify the amount of inflated EMI. Surprisingly the EMI remained same even after change in the interest rate on the same amount of principal and for same tenure, which only shows that the bank reversely calculated the interest based on the amount of inflated EMI and came out with the figure of 9.41%. Also the interest rates on loans as 9.41% are unheard of because the interest rates are usually like 8.75%, 9%, 9.25%. 9.50% etc. and not 9.41%. This act of the bank, its chairman, managing director, directors, officers and staff clearly shows the criminal intent to cheat me.
From the above, you will appreciate that when I inform about error in the balance outstanding principal amount, the bank brings out a new story of charges of Rs. 9,855/- and when I inform about inflated EMI, the bank comes out with another new story that the loan carries an interest rate of 9.41% as against the original rate of 8.75%. Also on each of both these occasions, I am sent a fudged document. So all the three documents sent by the bank give different versions/stories and it is obvious that the documents sent later are fudged documents and an afterthought. The first document is designed in such a way that the fraud is not apparent on seeing the statement, and not known until or unless critically examined. This clearly shows the ill design of the bank, its Chairman, managing director, the wholetime directors, officers and staff of cheating and depriving me of my hard earned money for their illegal gains. Also they must be cheating other innocent borrowers in the same manner and such a fraud is least expected from such a big bank.
It is pertinent to note that at the bottom in the very first document sent by bank, it is written that the first EMI (I.e. EMI due on 10.02.2008) includes Rs. 0.00 towards charges. This shows that if there were any charges, it must be the policy of the bank that the amount of charges, if any, would have been shown there. The fact that the charges mentioned as Rs. 0.00 clearly
show that there were no charges and the bank in a bid to cheat me is giving wrong/fudged statements and sending me one fudged document after another.
Also the clause 9 of the terms and conditions of loan supplied to me with the very first amortization schedule mentions that the advance EMI can be adjusted by the bank at its sweet will. The very first amortization schedule (repayment schedule) shows the principal amount outstanding after adjustment of advance EMI as Rs. 643,366/- which is correct as per the proposal as told to me by the representative of the bank. Had there been any element of any further charges, it would have been reflected in
the very first amortization schedule supplied by the bank. Also if there were any further charges then the balance principal would not have been shown as Rs. 643,366/- as the bank had all the liberties of adjusting the charges, if any, from the advance EMI.
I am attaching herewith all the three versions of the bank and also the amortization schedule sent by bank to another of its customers where there is no inflation in the principal outstanding, which will bring cat out of the bag and show the intentions of the bank to cheat me. Inspite of my repeated reminders, the Bank, its Chairman, being the Principal Officer of the bank, its managing director, the wholetime directors, the heads of car loans at the head office and the Delhi office, the other concerned officers and staff are bent upon cheating me and are not afraid of creating/manufacturing fudged documents and can go to any extent in cheating innocent persons.
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