2G spectrum case verdict: All you need to know about Vinod Rai, ex-CAG who triggered a political storm

A special court on Thursday acquitted all 19 accused , including former telecom minister A Raja and DMK leader Kanimozhi in the Enforcement Directorate’s money laundering case relating to the 2G scam. The Court said that the prosecution has miserably failed to prove any of its charges.

Congress leaders were quick to hail the verdict as a vindication of the then Prime Minister Manmohan Singh and the UPA government. Singh was quoted by TV channels as saying that ‘a massive propaganda was unleashed against his government over the 2G spectrum allocation’.“The judgment speaks for itself,” he added.

Aaj meri baat siddh ho gayi, koi corruption nahi, koi loss nahi. Agar scam hai to jhooth ka scam hai, vipaksh aur Vinod Rai ke jhooth ka. Vinod Rai ko desh ke saamne maafi maangni chahiye: Kapil Sibal,Congress #2Gverdict pic.twitter.com/nHTCTyiziC

— ANI (@ANI) December 21, 2017

Buoyed by the verdict, the DMK and the Congress said that the entire case was a “massive conspiracy” and “propaganda”. Former UPA ministers Kapil Sibal, Manish Tewari and Veerappa Moily said that the former CAG Vinod Rai — who had pegged the loss to the exchequer at Rs 1.76 lakh crore — should be held accountable now.

Mr VINOD RAI Former C&G must Apologise to the nation for throwing presumptive sensational Corrosive numbers into public discourse.He was author of imbecile 1.76 thousand crore loss theory that I had destroyed during my cross examination of Rai in JPC.court has affirmed JPC Report

— Manish Tewari (@ManishTewari) December 21, 2017

But who is Rai and what exactly is the Congress is accusing him of?

Rai is a renowned Indian economist who served as the 11th Comptroller and Auditor General of India from 7 January, 2008, to 22 May, 2013. Currently, he serves as the chairman of the United Nations Panel of External Auditors and is the honorary adviser to the Railways. On 30 January, 2017, the Supreme Court had appointed Rai as the interim president of the Board of Control for Cricket in India (BCCI).

During his term as CAG, Rai disclosed some of the biggest cases of corruption within various levels of government by producing a string of audit reports.

He is responsible for bringing to light several instances of institutional corruption such as the allocation of second-generation (2G) spectrum licences and of coal blocks, the 2010 Commonwealth Games, wasteful expenditure on the fertiliser subsidy, holes in defence spending, and anomalies in the award of contracts to exploit natural gas reserves.

Rai was born into an army family from Ghazipur, Uttar Pradesh. During his childhood, the family moved around a lot, eventually settling in Lucknow and Delhi, where Rai attended Delhi Public School on Mathura Road. After his father was posted in Sikkim, Rai was sent to a boarding school at age 14 at the Birla School in Pilani, Rajasthan. His school career was a happy and successful one, according to his teachers and contemporaries.

Rai, a 1972 batch IAS officer of the Kerala cadre, started his career as the sub-collector of Thrissur District. He serves as the MD of Kerala state co-operative marketing federation from 1977 to 1980. Later he was appointed as principal secretary (Finance) in the state government of Kerala. Throughout his career, Rai has held several senior positions in the Ministries of Commerce and Defence, Government of India. Prior to his appointment as CAG, he served as Secretary, Financial Services and Additional Secretary in the Banking Division including banks and insurance companies under Ministry of Finance.

‘Ruthless, zealot’

Through the course of his career, Rai acquired multiple reputations: Of an effective manager, a ruthless investigator, an activist zealot, a bully, a patriot, an upstart, according to  Livemint .

Rai faced severe attacks from many in the government, with many arguing that he had over-stepped the mandate the CAG has. The CAG particularly courted controversy in its assessment of 2G spectrum allocation, with its calculation of Rs 1.76 lakh crore loss being questioned repeatedly.

Critics in the government, according to the Livemint report, and especially in the telecom ministry, challenged the notion of a presumptive loss in an audit report, as well as the accuracy of the amount and the methods of calculation. But the CAG had succeeded in gaining the attention of the national media.

The 2G audit

As per an earlier Firstpost  piece, his report on the flawed 2G spectrum allocations by Andimuthu Raja, Communications Minister in Singh’s government, offered this high figure as one of four estimates of how much the country may have lost by selling spectrum in 2008 at 2001 prices. Raja made the allocations arbitrarily and the then prime minister failed to stop him, but Rai himself was made out to be a villain of sorts for pointing this out.

Speaking to Firstpost  back in 2014, Rai had said that though he agrees that the figure was large and had caught the public’s attention for that very reason, the CAG “didn’t do it with the intention of sensationalising it.”

When asked if the idea the idea of giving out a large number to catch the public imagination was deliberate, Rai had said:

“You see, the capacity of this country to endure malfeasance has become so substantial that when you talk of Rs 30,000 crore or Rs 40,000 crore loss, nobody even looks back. We have presented any number of reports where the loss has been Rs 18,000 crore; in the import of pulses, the loss has been Rs 24,000 crore. Nobody even bothers about it and the PAC (Public Accounts Committee) doesn’t even discuss it,”

“So, at the least (we felt), if the figure was large…We didn’t do it with the intention of sensationalising it, but since the figure was large, at least it caught the imagination of the public, of the PAC, and it has become a huge debate. Going forward, nobody will have the guts to do this kind of a thing again,” he said.

The trial in 2G spectrum scam started six years ago in 2011 after the court had framed charges against 17 accused in the CBI case for offences that entailed punishment ranging from six months to life imprisonment.

With inputs from agencies