PNB fraud: Bring out White Paper on banking system, Congress to Narendra Modi govt

Congress today called on the NDA govt to bring out a White Paper on the banking system in view of Rs 11,400 crore PNB fraud.

New Delhi: Amid a war of words with the ruling BJP, the Congress on Sunday asked the NDA government to bring a White Paper on the banking system, which it alleged had witnessed scams involving over Rs 61,000 crore in the last five years.

The Congress party also alleged that "fraudsters" were linked to the "highest echelons" of the BJP-led NDA and it is now imperative that the government brings out a white paper on the banking system.

"Bank frauds are tumbling out of the closet faster than you can say Jack Robinson," Congress spokesperson Manish Tewari said, alleging that another banking fraud was now out in the open.

Referring to the Rs 11,400-crore scam in which billionaire jeweller Nirav Modi and his uncle Mehul Choksi allegedly acquired fraudulent letters of undertaking (LoUs) from state-owned Punjab National Bank (PNB), Tewari said while the "Modi-Choksi tango" was still going on, reports had emerged about another banking fraud. 

Vikram Kothari, the owner of Rotomac Pens, owes Rs 800 crore to a consortium of Indian banks and was now untraceable, Tewari alleged. 

The frauds in the Indian banks are growing every day, the former Union minister and the Congress leader said.

Citing Reserve Bank of India data, Tewari claimed that ''Rs 61,260 crore of banking frauds had taken place in the last five years.''

"Data released by the RBI show that Rs 61,26o crore banking frauds have taken place in the last five years, and out of these five years, the BJP-led NDA has been in power for four years. The linkages between these alleged fraudsters and the highest echelons of the BJP raise some very serious questions about the health of the Indian economy," he told reporters here. 

Therefore, the Congress party "demands a white paper on the Indian banking system from the government," he said, adding that the BJP-led NDA should direct all banks to publish and declare the name of fraudsters and details related to NPAs ( non-performing assets).

The total NPAs of all public and private banks were worth Rs 8,36,782 crore as of September 2017.

"And 77 percent of these NPAs are of leading Indian corporate offices," he said, accusing the government of being unable to check NPAs and take care of the general public's money. 

India occupies the fifth position among 39 countries on NPAs, Tewari added. 

An NPA is when a loan taker cannot pay interest for two successive quarters. 

The Congress has been attacking the government over the fraud involving PNB, which detected a USD 1.77 billion (about Rs 11,400-crore) scam in which jeweller Modi allegedly acquired fake LoUs from the bank to secure overseas credit from other lenders. 

"It is hilarious that PNB, where this scam happened, won the vigilant award for 2016-17," Tewari said, adding that this scam raised an important question about the lack of transparency in the government. 

(With PTI inputs)