Personal website of R.Kannan

Personal Website of R.Kannan
My Encounters with Corporate Corruption
in My Service - Complaints to CVC

The Objectives that impelled me to Approach CVC Belatedly

Why I am making the Complaint to CVC at this hour?

I quote hereunder the extract on the subject from the complaint sent by me to CVC.

"I did not conduct investigations on behalf of the CVC, but on behalf of the Bank. I was subject to the discipline of the Bank and I could only submit findings to the Bank. This was the position until the year 1997, when my case was settled and I was allowed to retire from Service. Thereafter the then CMD continued in service up to Jan. 2000. When frauds were exposed the branches also try to recover the amounts in the first instance. All these years they had the opportunity. If they had recovered at least 25% of the amount involved this forbearance would have been justified. Recovery now appears like an attempt to recovering a bag of sugar got dissolved in the waters of the sea. CVC has to call for statistics on the 67 accounts (including present status report) covered in my complaints.

I suffered a stroke in March 2000 at Delhi and was hospitalized and thereafter settled in Hyderabad since April 2000. I started writing books of Discipline and Integrity in Services and happened to study the CVC web site in totality. The changed environment in corruption handling has again emboldened me in submitting my experience in public and leaving it to the sober society and public conscience to do what is considered apt and deserving. Is the Institution more important or interests of a corrupt few? Caught embroiled in their own coils, two senior most executives appear to have been booked already for corruption. So also the executive, who was dealt with in the earlier phase of my fight against corruption in the southern zone). But quite a few remain hiding, under the façade of innocence, but with a guilty conscience.

I am sending the entire material with Annexure to CVC and CVO. I am also sending this case history before hand to the present CMD through ED of the Bank. I feel relieved that I had not failed in my duty. My further cooperation and service if needed will be available at any time. Though I can have no say, still I will submit that this case should be looked into with regards of the role of the persons commencing from the top downwards, from the angle of cleaning and purifying the functioning of Head office and Delhi zonal office."

What Remedies I seek

I seek no reliefs for me. I did not request for restoring the increments cut in my pay for the calculation of my Gratuity payment. I have accepted what is paid to me by way of settlement on retirement. The crusade is for a public cause. When major issues are addressed reliefs intended for minor issues lose significance. True time renders certain things stale. But crimes under Prevention of Corruption Act suffer no such limitation. Borrowers who design modus operandi to cheat banks, where the amounts extend more than Rs.100 Lacs, should not go Scott free, if the genuine interests of our public financial institutions are to be considered. Persons with shady past should not hold office in senior positions as top executives of our Nationalised Banks. They should be made accountable. Persons who disrupt and "sabotage" control systems in our public institutions are a permanent threat to our society. These are my submission. CVC is a statutory body. I am not to tell them their functions or responsibilities. This is not a stale episode, as these are sequential developments in one continuous stream.

What Is Corporate Corruption?

In the United States in the 70's a legislation was passed styled RICO ACT, which stands for "The Racketeer Influenced Corrupt Organizations (RICO) Act." . Originally passed in 1970, the Act is a powerful tool in the fight against organized crime and in enabling persons financially injured by a pattern of criminal activity to bring a RICO claim in State or Federal court, and to obtain damages three times the amount of their actual harm, plus their attorneys' fees and costs. So is Corruption institutionalized in India, though we do not have a RECO here.

I will quote the opening lines of the Chapter on 'Corruption' in my book 'Integrity in Public Life & Service', which starts with a quotation selected from Brainy Quotes as under:

"In keeping silent about evil, in burying it so deep within us that no sign of it appears on the surface, we are implanting it, and it will rise up a thousand fold in the future. When we neither punish nor reproach evil-doers . . . we are ripping the foundations of justice from beneath new generations."
- Alexander Solzehnitsyn

Corporate Corruption represents much more than corruption practised by a few persons at the top of the organization's hierarchy. It is a complex mechanism corrupting the different systems and traditions of management, to provide for safety net to the corrupt coterie to operate within the organization with immunity and without fear.

Corporate corruption when supported by the CEO becomes self-sustaining and difficult to extinguish. Nationalised banks, despite having a Board of Directors and posted with nominee-Directors, representing Government of India and the RBI, remains predominantly configured as of one-man-show denominated by the CMD. Career seekers interest themselves in not trying to find how best to promote the interests of the institution, but how best to please the CMD and get into his good books. There is none to complaint and powers of investigating agencies are beset with powerful brakes - a special favour of top executives of Banks, despite the fact that all operational responsibilities are discharged at the branch and real load is on the branch Manager, in the set up. Corruption and frauds at this level range not in millions, but in crores. Nationalised banks have gathered huge resources in the last 15 years and with this the momentum of corruption has also increased. It has led to the growth of NPA of 63,000 crores in the contemporary period. It is in particular to highlight this phenomenon, I have also supplemented in this web site with five chapters on "NPA" in another Project "Indian Banking Today & Tomorrow". The solution can be found in the introduction of effective corporate governance in banks, and make the Board of Directors, the real controlling authority, with powerful, but independent audit machinery.

Mine is a voice from within the Institution. It is a lonely voice and a feeble voice, but it conveys a powerful message. Will it ever be heard? Will there be honestly administered PSBs? But let us keep hope and not despair.

In the following chapters I will give a brief resume of the contents of the complaints 1 to 6, quoting specific extracts without disclosing the identity of the persons complained at. It is for CVC and the new management of MYBANK to whom these complaints are sent to deal with.

Connected Reading

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