Notice to RBI, CBI in the petition filed by Dr. Swamy in the ‘bank loan fraud’ case
The Supreme Court on Monday issued notice to the Central Bureau of Investigation (CBI) and the Reserve Bank of India (RBI) on a petition by BJP leader Subramanian Swamy seeking a probe into the role of RBI officials in various bank loan frauds. Swamy in his petition pointed out that in many big loan defaults, the CBI probe is not looking into the aspect of the RBI officials who first approved these loans. The bench of Justices B R Gavai and B V Nagarathna issued a notice to CBI and RBI seeking their response.
Subramanian Swamy was assisted by lawyers Satya Sabharwal states. Swamy in his petition pointed out that from 1997, in none of the big banking scams, the agencies like CBI have not probed the role of RBI officials who first approved such big loans. He cited a series of bank loan scams that were first approved by RBI like the Kingfisher scam, the Bank of Maharashtra scam, the Uttar Pradesh-based Private sugar organization scam, the Nirav Modi/ Punjab National Bank scam, IL&FS scam, the PMC bank scam, Yes Bank scam, Lakshmi Vilas Bank scam, Rotomac Global Private Ltd scam, First Leasing Company of India Ltd scam, etc.
“Number and value of banking frauds detected by the RBI and other agencies during the last couple of years showed that despite enjoying wide, the RBI failed to protect the interests of various stakeholders including depositors, investors, and shareholders. This has led to a loss of faith in the entire banking system in India. “The regulator (RBI) is being supinely indifferent to the series of bank frauds with questions now being raised about it,” argued Swamy, stressing the need to probe the role of RBI officials who approved such high-value loans which later turned out to be a scam.
Swamy reiterated that CBI must probe into the illegalities committed by officials of RBI in the discharge of their official functions, which has resulted in various banking/ financial scams in India. He said that the RBI officials have been in demonstrable active connivance and in grave violations of their statutory duties.
“…no officer of RBI has ever been held accountable for any dereliction of duty in case of any fraud reported by any bank. This is in sharp contrast to the number of frauds exploding in the banking sector in India aggregating to in excess of over Rs.3 lakh crore (Rs three trillion),” PIL stated.
It was further stated that in the last couple of years, various banks have reported scam after scam wherein the role of bank officials was clearly made out but surprisingly not even a single RBI official has been brought to justice despite RBI retaining the power to monitor, regulate, supervise, audit and direct the functioning of all banking companies in India.
“Put pithily, the scheme of the Banking Regulation Act makes the Reserve Bank of India the alter ego of Bank Management, more so in the case of public sector banks. Yet, in none of the high-profile banking scams the Central Bureau of Investigation investigating these scams has not even sought to examine at a cursory level, the role of officials of RBI,” Swamy stated in the PIL.
The petition, through an RTI, has asked the RBI for the list of cases and banks involved in frauds aggregating to Rs.100 crore or more and entered in the RBI Central Fraud Registry from January 1, 2015 till date. The list of cases referred to CBI for fraud amount of Rs.100 Crore or more by the respective banks from 01.01.2015 till date. The details of the persons against whom such action has been initiated by the RBI in respect of frauds aggregating to Rs.100 crore or more in each case from 01.01.2015 till date. However, the RBI response to the RTI filed was not satisfactory, the PIL noted.
PGurus is now on Telegram. Click here to join our channel and stay updated with all the latest news and views
For all the latest updates, download PGurus App.
- Union Budget almost ready in Digital Format - January 27, 2023
- India condemns attacks on temples in Australia by pro-Khalistan supporter - January 26, 2023
- Hindenburg alleges brazen fraud by Adani in manipulating Stock Exchange prices. Company calls it malicious, baseless - January 26, 2023