Friday, Apr 26 2024 | Time 13:19 Hrs(IST)
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Business EconomyPosted at: Mar 22 2018 7:38AM


Mr Nair and Mr Bandlish said that this fraud has exposed the vulnerabilities of the Banks in regard to supervision and control internally and externally and also from the regulator’s point of view.
It ought not to be dismissed as case of some fraud or wrongdoing done by some lower-level staff in the branch of PNB. All those higher-ups who are involved in the fraud including the top Executives of the PNB must be proceeded against.
The RBI’s role and accountability in this episode has to be verified thoroughly. 'The claim of the RBI Governor that they have no effective powers to deal with such frauds is totally unacceptable'. RBI‘s audit and lack of control of nostro account has to be probed into. ' RBI should own responsibility and RBI Governor must step down'. If the Regulator with such vast powers and autonomy cannot monitor and prevent such gross abuse of procedure, the existence of RBI has no meaning,they said in the letter.
Besides the role of PNB and RBI, the role of various Banks who are part of these transactions should be properly examined. Similarly, the role of the auditors also need to be fully evaluated and assessed. There are so many levels of audits – concurrent audit, internal audit, systems audit, revenue audit, external audit, statutory audit, special audit, RBI audit, etc. and if none of these audits in the last 7 years could not detect such violation of procedure, the sanctity of audit itself comes under question.
Further SWIFT and Core Banking Solution are to be linked together as per RBI guideline and this was not done by PNB. In that case, what has been the role of RBI nominee on the Board of PNB to follow up the implementation of their guidelines.
Since the fraud involves huge public money, a high power Parliamentary Committee should probe into the whole issue to suggest accountability and improvement in the system, the UFBU leaders said.
We also note with great anguish and deep resentment about the demand from various quarters of vested interests to privatise the Banks in view of the fraud in PNB.
We urge upon you to make a categorical statement of denial of any such move on the part of the Government.
UNI CS SDR 0739
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