Urban Mirror Correspondent
New Delhi, November 24: The Lok Gathbandhan Party (LGP) today expressed concern over rising cases of frauds in banking sector. The LGP also accused the central government and baking management of failing to develop strong and fool-proof mechanism to control the crisis.
The spokesman of the party said here on Saturday that during the last two years instances of financial frauds have increased 20% with loot of Rs 14, 356 crore from Punjab National Bank by faudesters Nirav Modi and Mehul Choksi heading the list. The spokesman said despite increasing cost of anti-fraud measures adopted by the banks over the years, there has been no let-up in cheating cases including fraud documentation, cybercrime, bribery corruption, over-valuation, non-existence collateral, siphoning off funds etc. The spokesman said media report indicated that these frauds have been across sectors but they are higher in trading and commodity-based companies. The spokesman said at a time when the banking sector is highly stressed increase in fraud cases has given ample indication about wide gaps in security system and lackadaisical approach of the management in tackling the situation. The spokesman further said it has not been possible without corrupt banks management in collusion with politicians and entrepreneurs.
The spokesman said with the CBI investigating at least 292 cases of bank cheating and fraud involving 44 public and private sector banks, the LGP said the gravity of the acute problem could well be assessed but the NDA government does not have an effective action plan to overcome the crisis.
The spokesman said while the trust of the people in banks has been completely shaken, the NDA government has so far done nothing to expedite the criminal proceedings against these accused. The spokesman said huge non-performing assets (NPAs) or bad loans are in fact result of high level cheating in collusion with senior bank officers but there is no case against them. Pointing out that senior officers of IDBI, UCO, Bank of Baroda, United Bank of India and others are facing cheating charges, the spokesman said lack of transparency good governance and honesty have finally pushed the sector to the brink of disaster.
Criticising the RBI for failing in its supervisory role in this connection, the spokesman said it cannot escape the responsibility, and as the custodian of country’s financial system the central bank owes an explanation to the nation on the issue. The spokesman said last year alone the CBI was given permission to prosecute 22 bank officers. The spokesman said criminal proceedings against the officers should be speeded up to ensure punishment to these people. The spokesman said regaining the trust of people in the sector is necessary otherwise it will spell disaster for the nation.
