Guarantor of friends personal loan taken from co operative bank

Your responsibility is undisputed and the co-op bank has to proceed against you legally.

But ICICI bank freezing an account on the basis of the letter from a Co-op Bank is unknown in Banking circles.

Only a competent court, law enforcement authority can freeze the account.

Immediately issue a Registered Notice to ICICI bank as follows>

Please inform the specific reasons on the record for freezing SB Account No.....................standing in the name of....................at................Branch. and all those documents in the form of basing on which the account was frozen, together with a copy of such Manual of instructions that empowers ICICI bank freeze the salary savings account on a letter from Co-op Bank.  As the salary is sustenance for an employee and higher amounts may be needed during the pandemic period.. Please take notice that if no reply is received within a week from the branch, the complainant depositor will be constrained to approach the Banking Ombudsman/District Consumer Forum/Court for further relief for deficiency of service and harassment by the banker.

Wait for 15 days and post this as complaint on line to Banking Ombudsman.

After one month of serving the notice, file complaint before District Consumer forum.

As the guarantee, you are liable. However, the Cooperative ought to have adopted the sue process of law. Other banks have also overreached themselves. You may take up the issue with the RBI/Banking Ombudsman, as already suggested.

Thank you very much sir

In my above reply, "However, the Cooperative ought to have adopted the sue process of law." may kindly be read as "However, the Cooperative ought to have adopted the due process of law..

The lapse is regretted.

 

The act of freezing your bank account by the ICICI bank is illegal because you are not indebted to this bank in any manner and they cannot act on the advise of other bank to freeze your account. 

The cooperative bank has to follow the procedures of law to recover the loan amount amount from the guarantor if the borrower is absconding or defaulted in repayment of the loan amount.

You can issue a legal notice to the ICICI bank as well as to the cooperative bank questioning their authority or under which rule that they adopted this step to freeze your account and then you can drag both the bank to consumer forum for unfair trade practice as well as for deficiency in service.