Times of India
NEW DELHI: Reserve Bank deputy governor H R Khan on Thursday said the central bank is initiating action against ICICI Bank, HDFC Bank and Axis Bank in connection with allegations of money laundering by Cobrapost.
"Actions are on the way. Scrutiny has been done, actions is being taken both in respect of systemic level and at the individual banks," he said when asked if RBI has completed investigations on Cobrapost exposes.
"I will not be able to tell you the details but actions are being taken. Actions are being initiated both at the system level and the individual bank level," he said on the sidelines of an event organised by National Housing Bank here.
Asked when RBI would release the investigation report, he said, "I can't give you time frame but it will be out soon."
The country's three largest private banks — ICICI bank, HDFC Bank and Axis Bank — were last month named by online portal Cobrapost for indulging in money laundering.
The sting operation conducted by the portal alleged that some bank officials had offered to launder unaccounted money by investing in insurance schemes.
Soon after the exposes, Reserve Bank Governor D Subbarao had said some corrective steps will be taken to strengthen the banking system.
"...I believe systems are largely safe. However, there is a need for some corrective action and based on the findings of the investigation, we will take corrective action" he had said.
"I cannot at this time say or make broad, sweeping statement that there are no transactions taking place at all," the governor had said.
The footage taken in 'Operation Red Spider' purportedly shows a number of senior executives of the three banks verbally agreeing to take huge amounts of cash from the undercover reporter and putting them into a variety of long-term investment plans so that the black money ultimately is converted into white.
Following the sting operation, ICICI Bank suspended 18 employees while HDFC Bank has initiated an audit inquiry besides suspending 20 staff. Axis Bank has also formed a senior-level committee to oversee an internal inquiry and asked 16 employees concerned to report to the administrative office.
This refers to news item published today that RBI has initiated action against erring officials and erring banks who have been found involved in money laundering in sting operation conducted by Cobrapost.
God Knows why RBI is keeping the report on actions and finding on investigation as secret. It is worthwhile to mention here that last year When well known and reputed figure like Rajat Gupta was punished by USA court on the issue of insider trading , entire world was informed and all newspaper published it.
There is doubt however that RBI will take any action against any erring top officials of the bank involved in money laundering case exposed after sting operation conducted by Cobrapost. Some of junior officials may be scapegoat as usually done in case related to top bosses. This is Indian culture.
Government of India is maintaining complete silence because all of the important Chief Executive Officers CEOs like Executive Director , Managing Director, Chairman and Managing Directors of these banks are stage sharer on the functions headed by Finance Minister. Rather CEOs of alleged private banks are called as path decider , policy makers and best bankers .
Officials who can gift the top bosses and who can manage huge wealth for personal gain of powerful persons in India can only be preferred person in the eyes of powerful ministers and powerful RBI officials. Unfortunately CEOs of PSU banks are also following to same line of action , same corrupt practices and same illegal ways and means to increase business.Top bankers have to learn the art of reaching highest person by taking the help of most effective juniors who forms caucus around top brass.
This is why ministers remain silent whenever top executives of any bank is found guilty .A few years back also , top executives of LIC housing, PNB etc were found guilty in Housing scam but none of them were actually punished . similarly CEOs of Some other banks were also found guilty in cases related to KYC violations this year and a few years ago , but due to their closeness with top dignitaries they all are exonerated .
It is only USA government which treats all guilty on same footing irrespective of their stature and posts, national or foreigners. They decide on the merit and demerit of the case but Indian officials decide the case on the fact of closeness of the guilty with powerful lobby.
In India if an officer has backing of strong lobby at higher levels he can commit any blunder he is excused and on the contrary if an honest officer commit a petty mistake , heaven may fall on the earth.
In India if an officer has backing of strong lobby at higher levels he can commit any blunder he is excused and on the contrary if an honest officer commit a petty mistake , heaven may fall on the earth.
This philosophy of governance applies at all levels in India.
Link related to Rajat Gupta conviction is given below
http://www.thehindu.com/news/international/rajat-gupta-convicted-of-insider-trading/article3533335.ece
http://www.thehindu.com/news/international/rajat-gupta-convicted-of-insider-trading/article3533335.ece
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