By Ruma Dubey
On 22nd Oct, 2016, Arvind Gupta penned a letter to the Prime Minister, Narendra Modi and appealed to him, to investigate into the illicit banking and commercial relationship between Videocon Group of Venugopal Dhoot and ICICI Bank’s MD & CEO Chanda Kochhar’s family owned NuPower Renewable Group, steered by her husband Mr. Deepak Kochhar.
He wrote this letter in the capacity of a shareholder of both Videocon as well as ICICI Bank. His letter in detail explained all that which we read in the newspapers today, almost two years later. He is blunt when he says, “Sir, the fact that the Videocon Group led by Mr. Venugopal N. Dhoot has made hefty political contribution of Rs. 11.1 crore to the Bhartiya Janta Party’s (BJP) led Union Government during the year 2014, as against just Rs. 5 lakh in the previous year, should not deter the Government to order an appropriate independent investigation to bring out the truth relating to opaque corporate transactions and prevent impending banking crisis in the ICICI Limited. The Videocon Group is heading deep into crisis and will soon become drain on Banks as Non Performing Asset despite the ICICI Bank offering them murky financial supports. This is a serious misgovernance issue and deservers your intervention or else the reputation of the Government will get tainted?
He marked this letter to not just the PM but everyone, right from Arun Jaitley to RBI Governor to SEBI, Central Vigilance Commission, CBI, Enforcement Directorate, Financial Intelligence Unit – India, Serious Fraud Investigation Office and many more. Not a single one paid any attention for so many months. It took CBI over a year but at least it did open an inquiry around 15th of March’18. Today, right from SEBI, IT, CBDT and everyone is vying with each other for an investigation.
How come now after so many months, CBI woke up? There is a murmur going on at Mint Street that the Govt wanted to divert all the attention from PSU banks, wanting to show that the private sector banks are not as “greater than thou” as they are currently made out to be. Who knows, right? In politics, anything goes.
So why do we have this track record of never ever listening to whistleblowers? One can argue that the Govt will be getting hundreds of such letters every day, so how can they investigate everything? But then, Arvind Gupta is no mischief monger – he has a degree in economics from Banaras Hindu University, is the founder-trustee of Indian Investors Protection Council and holds a PhD in Public Sector Economics. Surely his letter should have been treated with some wisdom? Even yesterday, in an interview with the media, Gupta, when asked whether investigative agencies reached out to him post this, said, “I am amazed to share with you that none whosoever ever responded, you write to anybody, you write to whomsoever you want, nobody responds, nobody takes cognizance, nobody even acknowledges.” That’s how it is.
There is so much wrong doing here; a banking official would find all this “conflict of interest” so routine and confer in private that this is what happens and has been happening in the banking sector for times immemorable.
In the wake of this, what needs to be done on an urgent basis is a need for making it mandatory for CEOs and senior banking officials to declare their family interests. Is there a practice at all within the Board to disclose this information?
It also brings into perspective this great solution which we all have to cure the PSU banks of the NPA malaise – privatize them. Obviously, we now see that it is not the best solution.
As we say time and again, unless we have very strict punitive actions, the fear of getting caught to face rigorous punishment, private or public, fraud will not end. As humans, we probably sacrifice integrity at the altar of huge money; it is only fear of the repercussion which can keep this greed at bay.
For a complete detailed read of Arvind Gupta’s 2016 letter - http://bankingsectornpas.blogspot.ae/2016/10/0-0-1-87-501-maxfusion-research-4-1-587.html