'What are our auditors doing?': Asks Arun Jaitley as he breaks his silence on Rs 11,400 cr Punjab National Bank fraud

The finance minister said an example should be made of the fraudulent people involved in the Punjab National Bank scam

IANS February 21, 2018 07:35:22 IST
'What are our auditors doing?': Asks Arun Jaitley as he breaks his silence on Rs 11,400 cr Punjab National Bank fraud

New Delhi: Breaking his silence on the Rs 11,400 crore PNB scam, Finance Minister Arun Jaitley on Tuesday blamed the auditors for failing to detect the fraud and said the scamsters will be chased and measures will be put in place to prevent such scams.

"What are our auditors doing? Both internal and external auditors really have looked the other way or failed to detect. I am sure the profession of Chartered Accountants and those who control the discipline of the profession will start introspecting and see what are the legitimate actions which are to be taken," he said in his first public comments on the huge fraud in the Punjab National Bank that has rocked the banking system.

"And, of course, there is also an important challenge where the supervisory agencies have now to introspect what are the additional mechanisms they have to put in place to make sure that stray cases don't become a pattern and it is nipped in the bud," Jaitley said speaking at an event here.

What are our auditors doing Asks Arun Jaitley as he breaks his silence on Rs 11400 cr Punjab National Bank fraud

A file image of finance minister Arun Jaitley.

The finance minister said an example should be made of the fraudulent people involved in the scam and such examples should never be repeated again.

"I say this because these kinds of developments have a cost to the country and cost to the tax payers. It is a direct cost and it has an indirect cost, which impinges upon the bank's capacity as a lending institution and therefore, it obviously impinges upon developmental finance," he said.

Also without naming Nirav Modi, the main accused in the multi-crore PNB fraud case, the finance minister said: "With regard to lack of ethics that a faction of Indian business follows, it is incumbent on us as a state, till the last legitimate capacity of the state, chase these people to the last possible conclusion to make sure that the country is not cheated."

Talking about the Indian banking system, he said: "When a society has invested so heavily in its banking system...the Prime Minister himself had announced that we want you to be autonomous. None of us is going to call you up and therefore take your own decisions. When authority is given to the managements, you are expected to use that authority effectively and in the right manner.

"And therefore a question for the management is, were they found lagging? And on the face of it the answer seems yes they were. They were also found lacking in being able to check who amongst them were the delinquents here."

Updated Date:

also read

These government banks are offering senior citizens higher interest rates on FDs than Post Office; check here
Business

These government banks are offering senior citizens higher interest rates on FDs than Post Office; check here

The interest rates promised are significantly greater than those provided by the Post Office. The 666-day fixed deposit plan offered by Canara Bank guarantees senior citizens a 7.5 percent return on their investment

Bank Locker Charges: Check out locker charges at these leading government and private banks
Business

Bank Locker Charges: Check out locker charges at these leading government and private banks

Based on the size of the locker and the location of the branch, banks impose a charge for using such a service

PNB asks customers to update KYC by 12 December or their account may get closed; details here
Business

PNB asks customers to update KYC by 12 December or their account may get closed; details here

PNB has notified that failing to update KYC may cause the account's operations to be restricted. As part of the KYC principle, the RBI has given some guidelines about the depositors’ identification