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November 2018
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India in Australia: Kohli promises to not start arguments, only finish them        At Least Two Killed, Eight Injured In Blast In Karachi        Centre's New Move May Escalate Feud With RBI Ahead Of Board Meet: Report        'Gaja' crosses coast, rainfall pounds TN, 22 dead        Sabarimala board to move SC, buy time to implement order        Sabarimala board to move SC, buy time to implement order        Sindhu crashes out; Srikanth, Sameer enter quarterfinals of Hong Kong Open        No more chopping and changing till World Cup: Ravi Shastri        Air India eyes Rs 800 cr from sale of over 70 properties        Intel India opens design house costing Rs 1,100 cr at B'luru        US, China see rival visions for entwined Asia-Pacific region        Imran Khan to visit Malaysia next week; likely to seek monetary aid        EC removes Mizoram chief electoral officer after protests        Lankesh murder accused sent to SIT custody in Pansare case        Agri sector needs long-term solutions, loan waiver temporary: Naidu        Top India, China officials hold defence, security dialogue, agree to step up military exchanges        Jailed Om Prakash Chautala Expels Older Son For "Anti-Party Activities"        ISRO Launches Communication Satellite, Has 'Geo-Eye' To Monitor India        US Vice President Mike Pence takes Myanmar’s Aung San Suu Kyi to task over treatment of Rohingya        Sri Lankan Parliament passes no-trust vote against Rajapaksa        
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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.


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KERALA NEWS
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INTERNATIONAL NEWS
At Least Two Killed, Eight Injured In Blast In Karachi
 (KARACHI, Nov17, 2018): A bomb killed at least two people and wounded eight others in Pakista
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US Vice President Mike Pence takes Myanmar’s Aung San Suu Kyi to task over treatment of Rohingya
NATIONAL NEWS
'Gaja' crosses coast, rainfall pounds TN, 22 dead
 (Chennai, Nov17, 2018): Cyclone Gaja ripped through Nagapattinam early Friday uprooting trees
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