Former chairman of the Insurance Regulatory Development Authority of India (IRDAI) TS Vijayan appointment to Yes Bank’s board as a director in 2018 has come under Union Ministry of Finance’s scrutiny for not obtaining the prior approval of the government.
As reported by The Economic Times, after issuing a show cause notice, the department of financial services of the finance ministry has appointed achief vigilance officer of United India Insurance, R Balasubramanian, to look into the details of the allegations against Vijayan a few days ago, being the new inquiry officer.
As per the guidelines, IRDA chairman and members are barred from being appointed on the board of any private or Government Company in the insurance industry for two years after their retirement from the regulatory body. It is a mandate to acquire special permission from the Centre if any company wishes to do so. IRDA rule titled ‘Bar on Future Employment of Members’ mentions this criteria.
Vijayan retired as the Chairman of IRDA in February 2018 and in the same year he was also appointed as an independent director on the Yes Bank board. The lender is a corporate agent to insurance providers such as Max Life and Reliance General Insurance, that directly fall under the regulation of IRDA. Further, Vijayan was the key member of the search and selection committee formed to appoint the successor of former Yes Bank CEO Rana Kapoor.
On March 5, Yes Bank was brought under moratorium by the Reserve Bank of India and the board of the bank was superseded.