Bank of Maharashtra responds to whistleblower report--Business
Line-----My views are given below
The Bank of
Maharashtra’s “comments” on The Hindu’s whistleblower story of June
13, 2013 (“To fix whistleblower, bank moves from verse to worse”).
The
complaint made by him to the Governor, Reserve Bank of India, on the issue of
the grant of a loan of Rs.150 crore to United Spirits Ltd. was based on
information that was available in the bank and [was] not a matter of any
discovery, as such being a routine business decision taken at the highest level
by the Credit Approval Committee of the bank on merits […] We wish to
specifically mention that the said account has been proved to be extremely
healthy and remunerative to the bank […].
Scrutiny
We state
there is nothing to be blown in the matter […] the bank is a public sector bank
and is subject to several statutory and regulatory limitations and that every
decision of the bank is subject to scrutiny at various levels […].
As regards
the charge sheet issued to Mr. Tuljapurkar, the issue is not restricted only to
the allegation that Mr. Tuljapurkar has caused a vulgar and indecent poem to be
published in the union’s in-house magazine “Bulletin.” We wish to clarify that
in the year 2013, the bank came across a reasoned judgment dated 20/01/2010 of
the Hon’ble High Court, Bombay, Aurangabad bench, in criminal application
number 2074/2002. It was held that the said poem about Mahatma Gandhi did not
amount to a fair criticism and satire of Gandhian thoughts and ideas and that
the poem published and circulated by Mr. Tuljapurkar was certainly obscene in
nature. The Hon’ble High Court had directed Mr. Tuljapurkar to appear before
the Chief Judicial Magistrate, Latur, to face the trial launched against him
[…] the bank also came across the fact that Mr. Tuljapurkar had filed a special
leave petition before the hon’ble Supreme Court no. 2871/2010 on the aforesaid judgment
and the same [was] admitted and the Hon’ble Supreme Court has granted an
interim stay on the proceedings against Mr. Tuljapurkar […]. The action has
been initiated only when the bank came to know that a criminal trial was
pending against Mr. Tuljapurkar and that he had concealed the said fact for 19
long years although he was an office bearer of the union, a workman director on
the Board of Directors […].
We wish you
to note that the performance of the bank for the financial year 2012-13 was
held as extremely exemplary […].
My Comments on explanation given by CMD of
Bank of Maharashtra on his vindictive step
against a whistleblower
I completely
disagree with the explanation given by CMd of Bank of Maharashtra to support
his vindictive action taken against Union Leader Mr. Tuljapurkar.
He says that
Mr. Tuljapurkar is not a whistle blower because he has presented the
information which was based on information that was available in the bank and
[was] not a matter of any discovery.
He CMD
should know that policy of whistleblower is framed only for the exposure of
misdeeds of top officials by internal officials who is well aware of hidden
facts posing threat to bank and not at all for discovery of what is not
happening .Whistleblower is that internal staff who only presents those
information which are otherwise hidden due to malicious intention of corrupt
executive and which is causing loss to the bank or which may cause loss I
future. Whistleblower is that person which informs to competent authority that
a particular sanctioning authority is misusing his delegated power for personal
gain despite probable threat of causing loss to the organization.
Secondly CMD
says that the loan sanctioned to UB group was duly approved by Credit approval
Committee (CAC) and it was a routine business decision taken by CAS based on
merit. He further mentions that
the said account has been proved to be extremely healthy and remunerative to
the bank.
It is
worthwhile to mention here that all loans sanctioned by any Branch Manager or
any delegated authority or CAC is a routine business decision and remunerative
in the beginning and remains so for a few years. The question is of perception
and credit worthiness of the borrower , status and market report of the loan
seeker at the time proposal is sanctioned ,integrity of borrower and future
prospect of the project when the proposal is submitted before the
competent authority for sanction.
If any
sister concern or group account is NPA, fresh loan to same group cannot be
considered for sanction. Loan cannot be sanctioned for liquidation of existing
bad loan of the same group or person. It is immaterial whether the loan account
after its sanctioned is standard or non performing asset (NPA) in the books of
account of a bank if the same is sanctioned by the competent authority in well
prescribed way only and more transparent way.
All assets
which are now stressed assets or NPA in books of various banks are definitely
sanctioned by CAC or Branch head in way which is normally expected by bank
management. It is further observed that process notes of bad borrowers are normally
prepared in better and descent way compared to that of good borrowers by
sanctioning authority. When the intention is bad , the competent authority
preparers all necessary documents and taken all precautions that deviation of
policy is not visible .When a thief decides to commit the act of stealing he
invariably takes all precautions to avoid his arrest and to avoid all legal
action. In bank too, a bad borrowers prepares all necessary documents in
beautiful way, submits all required papers even though falsely and fraudulent
prepared and the person who sanctions the loan also takes all preventive steps
so that he is not caught by auditors or higher bosses. Still some lacunas are
left and the thif or a bad manager is caught at later stage.
Problems
arises only when account goes bad and then reason is falsely ascribed to Global
recession or interest rate or natural calamity even when the real culprit is
sanctioning authority or the bad borrower. It is seen in many cases that a
particular borrower who is bad in one bank manages officials of other bank for
sanction of bigger loan,
Loan
proposals of unscrupulous and bad borrowers or that of good borrowers, all
cases are necessarily approved by competent credit officials or CAC in well
defined manner and sanctioned apparently in compliance of existing norms only.
Still there use to be violation of rules and deviation of policy while
sanctioning a loan proposal which comes to light when a whistleblower points
out or when auditors submit a report on the account.
Point to be
stressed here that when the loan seeker has the capacity and managerial skill
to motivate sanctioning authority or members of CAC, he can manage his loan
proposal sanctioned by hook or by crook. It is bitter truth that majority of
existing bad assets in all banks are caused by unscrupulous credit officials
and sanctioning officials only. And only in few cases, the reason for
asset going bad is found to be natural calamity or global recession or
due to reasons beyond the control of loanee.
More
particularly I wish to point out here that when head of CAC ( constituted
of departmental head and few other senior members ) , say a CMD proposes
verbally that a particular loan proposal should be sanctioned, other members of
CAC blindly put their signature on loan proposals. It is undeniably bitter
truth of CAC that proposals are seldom seen and assessed by all members
of CAC.In majority of meeting of CAC the proposals are simply okayed by members
to honour the views of top bosses.
When
CMD is the head of CAC or when Some RBI officials are interested in sanction of
a loan presented to Management committee for loan approval, none of members has
courage to object it. Besides most of members of CAC or MAC are not well versed
with intricacies of loan proposals and they do not understand the merit and
demerits of the proposal and hence they blindly sign on the proposal just as
President of India sign on bill approved by Parliament and where bill is passed
by voice vote and none of Member of Parliament goes through seriously to
understand the merit and demerit of any bill introduced in Parliament. Similar
is the practice in all committee oriented decisions. Members of a tender
committee or loan waiver committee are not well skilled in the job which is
associated with other departmental heads. Quorum of members in a Committee is
completed by including any Tom Dick and Herry so that in future none can raise
fingers against any individual when the action is treated a bad.
CMD of the
bank further asserts that there is nothing to be blown in the matter […] the
bank is a public sector bank and is subject to several statutory and regulatory
limitations and that every decision of the bank is subject to scrutiny at
various levels.
Here I may
say that all decisions especially financial decisions and lending decisions
normally taken by any authority are always checked by auditors and
inspecting officials. They are certified as good too. Even after that many
accounts turn bad at a later stage in the bank and it is established by bankers
only that the action of sanction by delegated authority or monitoring part of
branch officials or legal scrutiny of documents made by panel lawyers was
defective and erroneous and departmental inquiry is initiated to know the truth
and in many cases junior officers have been punished , suspended and dismissed
. Question here is whether seniors and top executives like CMD are taken to
task when their mistake and malicious intention is proved.
So far as
case pending in court of law is concerned, I am not making any comment and the
same will be decided by Supreme court in due course of time.
Lastly CMD
has completely failed to convince why he has taken a punitive action after 19
years. I need not enlighten because it is crystal clear to all educated persons
that an action taken against an officer after 19 years for a poem written 19
years ago in nothing but retaliatory step taken by a person who is in power.
Here the
main question is whether the action taken by RBI officials on a complaint
lodged by a bank senior official against CMD was right and beyond doubt.
When the
complains relates to serious lapses on the part of CMD of a bank is concerned ,
it was the duty of RBI officials to get the same checked by a person or
committee which is having higher power and position than CMD , which is
having greater knowledge and skill on process of sanctioning of a
loan proposal and which is unbiased against CMD and Borrower and which
has the track record of honesty and devotion.
Forwarding
the complain copy for investigation to the person who himself is alleged to be
guilty and involved in loot cannot be justified by any responsible person or by
any judicial body.
It happens
in our country only that a case of loot or scam by a senior minister or senior
officials of the department is referred to same team of officials and ministers
for investigation whether there was any act of omission or commission. Thief
police is assigned the duty to inquire whether the act of stealing took place
or not.
It is the
tradition of Indian administration and financial system that complains of
irregularities committed by an individual or a group is handed over to
totally incompetent but blind flatterer to look into the gravity of
complain so that the real culprit can manage the report in his or her favour
and get the case of complain closed for ever. Top bosses are more interested in
closure of cases related to complain than to take action against erring
officials and take remedial steps for stopping recurrence of
such mistakes in future.
This is the
root cause that one after other high value scams come into light and goes into
dark in a few days and months.None of ministers get punished when he or she is
found to be indulged in scam. At most the minister is advised to
resign or dismissed.In banks also when a top ranked official is found to be
guilty , he is advised to voluntarily retire from bank . But if the case of
irregularities are against any junior level officer and he has got no God
Father to save him , full fledged inquiry is initiated and severest punishment
is awarded.
There are
hundreds and thousands of cases where staff accountability is not fixed against
any official only because he is an executive holding top post. If the
sanctioning authority is a branch manager upto scale III, the action taken may
be a little bit faster if the sanctioning person has got no Godfather at higher
offices.
If a culprit
bank officer has good relation with higher bosses, no power on earth can punish
him, even vigilance officer or inquiry officer is persuaded by different clever
persons. And this is why quantum of bad asset is increasing in every bank and
there is no doubt that it will continue to go up and up even if Finance
Secretary issues threatening letters to CMDs to keep Net NPA confined to 1% of
total advances.
On the contrary
there are several such instances available in all banks where officers on
flimsy ground are served charge sheet when when they are on the verge of
retirement.
Junior officers are penalized on petty issues , inquiry is set up on
non-serious lapses, memos are served for ridiculous reasons and the most
perturbing is that in most of the cases explanation submitted by such accused
person are declared unacceptable and unconvincing by clever officials of the
management sitting at higher offices.
There are many cases where a person is served charge sheet for serious
lapses, intentional and ill-motivated decisions on credit
proposals and grave mistakes and deficiencies found in credit
monitoring, pre-sanction inspection, documentation and post disbursement
formalities , officers are exonerated even before investigation if the accused
person has linkages with Ministers and top officials including CMD.
Even vigilance officers think it better to close the chapter of inquiry without
loss of time if the connections of accused are important
and powerful officials also delay the investigation for decades in
such cases.
Lastly I would like to suggest that officers and ministers in power should stop the culture of punishing whistleblower and on the contrary make all possible efforts to find out the gravity of all types of allegation and try to punish the real culprit in proper way.
My Comments on explanation given by CMD of
Bank of Maharashtra on his vindictive step
Junior officers are penalized on petty issues , inquiry is set up on non-serious lapses, memos are served for ridiculous reasons and the most perturbing is that in most of the cases explanation submitted by such accused person are declared unacceptable and unconvincing by clever officials of the management sitting at higher offices.
There are many cases where a person is served charge sheet for serious lapses, intentional and ill-motivated decisions on credit proposals and grave mistakes and deficiencies found in credit monitoring, pre-sanction inspection, documentation and post disbursement formalities , officers are exonerated even before investigation if the accused person has linkages with Ministers and top officials including CMD.
Even vigilance officers think it better to close the chapter of inquiry without loss of time if the connections of accused are important and powerful officials also delay the investigation for decades in such cases.
Lastly I would like to suggest that officers and ministers in power should stop the culture of punishing whistleblower and on the contrary make all possible efforts to find out the gravity of all types of allegation and try to punish the real culprit in proper way.
Sunday, June 16, 2013
Read And Share With All How Looter CMD of Bank
Likely To Dismiss Whistleblower Who Informed Entire Story of Loot To RBI
Union leader Devidas Tuljapurkar faces
victimisation and possible dismissal by the Bank of Maharashtra, as it suspects
him of being the whistleblower behind a story in “The Hindu” on July 7, 2012.
For one
unfortunate whistleblower, things have gone from verse to worse. Embarrassed by
revelations about its curious dealings with corporate clients, the Bank of
Maharashtra has declared war on whistleblowers. And since it can’t pinpoint
them, the bank has gone after internal critics on novel grounds. It has chargesheeted
a Union leader and ex-Director of the BoM for acts “prejudicial to the
interests of the Bank.” That is, for publishing 19 years ago, a poem it calls
‘vulgar and obscene,’ in the Union’s in-house magazine, ‘Bulletin.’ That poem
is the basis of the Bank’s charge sheet against a worker with an impeccable
service record.
Click on following link to read entire story
http://importantbankingnews.blogspot.in/2013/06/read-share-with-all-how-looter-cmd-of.html
Click on following link to read entire story
http://importantbankingnews.blogspot.in/2013/06/read-share-with-all-how-looter-cmd-of.html
This comment has been removed by the author.
ReplyDeletevery correct and forceful rejoinder
ReplyDeletesrinivasan