The Union finance minister, P Chidambaram stated the regulators must implement proposals of the Finance Sector Legislative Reforms Commission (FSLRC).
The FSLRC report contains 12 key proposals and these do not require legislative changes. It also included a draft Indian Financial Code that is expected to replace the current financial sector legislations but is unlikely to be tabled in Parliament soon.
About FSLRC report
- The financial sector regulators will take serious action with high penalties on violators and time bound investigations that would act as deterrents and improve consumer protection.
- The proposals that called for penalties discourage the future violations as a multiple of the illegitimate gain of violations.
- Regulators should also put in place internal manuals on conducting investigations. The investigating officer would be kept different from the officer who would decide the penalty for the crime.
Note: The Financial Stability and Development Council on October 2013 decided to finalize an action plan for implementation of all FSLRC principles on regulatory governance, transparency and improved operational efficiency that do not require legislative action.