14
Wednesday
November 2018
10:46 PM IST
News Headlines
India to host Italy on grass in Kolkata        It won't be easy for Mary Kom, says High Performance Director Nieva        Sensex rebounds 332 pts on easing crude, rupee gains        Govt mulls second round of 2,500 MW medium-term PPA auction        UK says Brexit deal 'almost within touching distance'        Trump criticises Macron again over European defence remarks        Infiltration bid foiled by Army in J&K, two terrorists killed        Delhi's pollution remains 'severe' as light showers further deteriorates air quality: authorities        Flipkart Group CEO Binny Bansal quits over 'serious personal misconduct' charges        Preparing for Australia tour by watching videos: Shami        India invites Swedish companies to explore investment opportunities        Govt cancels ED officer Rajeshwar Singh's leave        175 dead, over 10,000 affected by Nigeria cholera outbreak        Lankan parties move SC against Parliament dissolution by Prez Sirisena        Delhi pollution: Task forces conducts meetings on WhatsApp for urgent decisions        PM slams Rahul, Sonia for questioning note ban; need no certificate from those on bail        70 per cent turnout in first phase of Chhattisgarh polls: EC        Union Minister Upendra Kushwaha attacks NDA ally Nitish Kumar amid reports of RLSP MLA joining JD(U)        Mining Baron Janardhana Reddy Remanded in Custody Till November 24 for 'Shielding' Ponzi Scam Accused Father-Son        Death toll hits 25 from wildfires at both ends of California        
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Business News
RBI submitted a list of high profile fraud cases to PMO: Rajan
 
New Delhi, Sep 11 (PTI) A list of high profile cases related to banking frauds was sent to the Prime Minister's Office (PMO) for a coordinated action, said former RBI Governor Raghuram Rajan in a note to Parliamentary panel.

In the note to Chairman of Estimates Committee Murli Manohar Joshi, Rajan said that the size of frauds in the public sector banking system has been increasing, though still small relative to the overall volume of NPAs.

"The RBI set up a fraud monitoring cell when I was Governor to coordinate the early reporting of fraud cases to the investigative agencies. I also sent a list of high profile cases to the PMO urging that we coordinate action to bring at least one or two to book. I am not aware of progress on this front. This is a matter that should be addressed with urgency," he said.

Rajan, who was RBI governor for three years till September 2016, is currently teaching at the Chicago Booth School of Business.

Noting that system has been singularly ineffective in bringing even a single high profile fraudster to book, he said, frauds are different from normal non-performing assets (NPAs).

"The investigative agencies blame the banks for labelling frauds much after the fraud has actually taken place, the bankers are slow because they know that once they call a transaction a fraud, they will be subject to harassment by the investigative agencies, without substantial progress in catching the crooks," he said.

The statement assumes significance in the light of Nirav Modi and his uncle Mehul Choksi, in connivance with certain bank officials, allegedly cheated PNB of about Rs 14,000 crore through issuance of fraudulent Letters of Undertaking (LoUs).

A Mumbai branch of PNB had fraudulently issued LoUs for the group of companies belonging to Nirav Modi since March 2011.

The total number of LoUs issued to the companies of Nirav Modi, his relatives and the Nirav Modi Group are 1,213, and to Mehul Choksi, his relatives and the Gitanjali Group are 377.

On whether the regulator could have done better, Rajan said it is hard to offer an objective self-assessment but the RBI should probably have raised more flags about the quality of lending in the early days of banking exuberance.

"With the benefit of hindsight, we should probably not have agreed to forbearance, though without the tools to clean up, it is not clear what the banks would have done. Forbearance was a bet that growth would revive, and projects would come back on track.

"That it did not work out does not mean that it was not the right decision at the time it was initiated. Also, we should have initiated the new tools earlier, and pushed for a more rapid enactment of the Bankruptcy Code. If so, we could have started the AQR (asset quality review) process earlier," he said.

Finally, he said, the RBI could have been more decisive in enforcing penalties on non-compliant banks.

"Fortunately, this culture of leniency has been changing in recent years. Hindsight, of course, is 20/20," he said.


Sensex rebounds 332 pts on easing crude, rupee gains
Govt mulls second round of 2,500 MW medium-term PPA auction
India invites Swedish companies to explore investment opportunities
Govt cancels ED officer Rajeshwar Singh's leave
Facebook blocks 115 accounts ahead of US midterm elections
Indian norms on PCA, capital are conservative, rule-based: SBI
SBI back in black on credit growth
TN transport employees threaten to go on strike
Ease of biz ranking: Indian can improve further, says Jaitley
Rupee declines 11 paise to close at 73.27 against US dollar
Gold rises in futures trade; up 0.54% on global cues
Mistry announces startup fund on 2nd anniversary of his ouster
BSE gets Sebi's nod to launch Oman crude oil contract
Sensex cracks 34,000-mark, Nifty below 10,200 on weak global cues
Petrol pumps in Delhi on strike demanding VAT cut
RBI likely to stay on hold for rest of FY'19 : Report
Japan introduces Artificial Intelligence technology to ease business
Reliance Industries posts net profit of Rs 9516cr in Q2
Infosys Q2 net profit grows 10.3% to Rs 4,110 crore
Trillions in US net worth vulnerable to recession: IMF
KERALA NEWS
Sabarimala protests: Arrests up to 2061, Kerala HC warns police
 Thiruvananthapuram, OCT 27: As the number of people arrested for allegedly being involved in violent  
Vijayan urges UAE Keralites to back salary challenge
Sabarimala row: Protests against SC verdict continue
Balabhaskar's wife Lakshmi shifted to ICU
INTERNATIONAL NEWS
UK says Brexit deal 'almost within touching distance'
 London, Nov 13 (AP) Britain and the European Union are "almost within touching distance" of a Brexit
Trump criticises Macron again over European defence remarks
175 dead, over 10,000 affected by Nigeria cholera outbreak
Lankan parties move SC against Parliament dissolution by Prez Sirisena
NATIONAL NEWS
Infiltration bid foiled by Army in J&K, two terrorists killed
 Srinagar, Nov 13 (PTI) Two unidentified terrorists were killed Tuesday when the Army foiled an infil
Delhi's pollution remains 'severe' as light showers further deteriorates air quality: authorities
Delhi pollution: Task forces conducts meetings on WhatsApp for urgent decisions
PM slams Rahul, Sonia for questioning note ban; need no certificate from those on bail
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