Sucheta Dalal :Bury 15000 People—and Other Scams
Sucheta Dalal

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Bury 15,000 People—and Other Scams  

June 16, 2010

The neta-babu class seems to have patented the drag-&-dilute technique of burying a scandal

When death came to Bhopal a quarter century ago, it was at least indiscriminate in picking its targets. It is only when our netas and babus got into the act that they ensured that those who were culpable were let off and the case dragged on for decades in the hope that nobody would ever remember the details.

Actually, they probably couldn’t have found a worse time to tell the world that life is cheap in India and justice is non-existent. But our leaders just don’t get it. What could have been more embarrassing than for law minister Veerappa Moily to go on television and say that the case against Warren Andersen, the then CEO of Union Carbide, is still open? He also said that India needed a new law to cover Bhopal-like crimes. Yet another Congress minister pulled the stunt of locating a tribunal for environmental crimes at Bhopal. Isn’t the National Judicial Academy (NJA) located at Bhopal? It didn’t prevent the grotesque denial of justice or adequate compensation for Bhopal victims. Such knee-jerk political reactions have only increased worldwide outrage after a pathetic verdict. 

A column by Mohan Murti in the The Hindu Business Line, titled “Is the nation in coma?”, which is being furiously forwarded, is probably an expression of the shame that most ordinary Indians are feeling at the Bhopal verdict.

Funnily, it is not about Bhopal at all. Mohan Murti writes about the questions on India that he faced at a European conference attended by over a 100 CEOs. The world is angry at our appalling corruption and ‘elephantine judiciary’ which can bury every scam by simply dragging the case for decades. Pertinently, he writes, “Europeans believe that Indian leaders are too blinded by new wealth and deceit to comprehend that the day will come when the have-nots will hit the streets.” 

The rising Naxal menace already seems an ominous indicator of this. He further says, “In the European mind, caricature of a typical Indian encompasses qualities of falsification, telling lies, being fraudulent, dishonest, corrupt, arrogant, boastful, speaking loudly and bothering others in public places or while travelling, swindling when the slightest of opportunity arises and spreading rumours about others.” It is not a picture that we like, but we cannot deny that it is one we recognise.

How to bury a scandal—whether it is Bofors, Bhopal or a financial scam—has now been refined to such proficiency that it can be patented. The drag-&-dilute technique of burying a scandal also has side-benefits for the neta-babu class.
It can be revived at any time to embarrass a politician or an industrialist to keep critics in place. Occasional, inexplicable reports about long-buried scandals are the only indicators of this low, insidious action. One such case, which popped up in the public domain in June, was a one-paragraph report that the Serious Frauds Investigation Office (SFIO) attached to the ministry of corporate affairs was going to investigate the Global Trust Bank (GTB) fraud.

GTB collapsed a decade ago and all corporate groups that were hand-in-glove with Ketan Parekh and had accounts in GTB, were either exonerated or on the way to being let off. So why pick on GTB? The SFIO official we spoke to was curt and vague.

As far as Ramesh Gelli, the promoter of GTB is concerned, it has always been a mystery why little action was taken against him and the corporate houses that colluded with Ketan Parekh. Even now, SFIO is not willing to say whether its investigation will be directed at GTB or its officials who were too weak to defy dubious orders from their bosses.

So we looked at the latest (14th) Action Taken Report (ATR) dated May 2010 regarding the Joint Parliamentary Committee (JPC) report of 2003. Another surprise. We discover how beautifully each ATR lists, dilutes and buries cases that are inconvenient and carries forward those that are meant to be kept alive for political reasons. Companies that had little to do with violating foreign exchange rules were investigated and exonerated, with no mention of routing transactions on behalf of Ketan Parekh. Some others are adjudicated and let off, without specifying why. We also learn that only five of the 276 recommendations/observations made by the JPC are pending action. Isn’t it strange that one hardly recalls anyone being punished?

Of the 15 companies mentioned in the JPC report, and seven others in the SEBI report (such as Maars Technologies, Mascon Global, Mukta Arts, Tips Industries, Balaji Telefilms, Kopran group, Nirma and Cadilla), action against 18 is complete. What kind of action is this? In the case of Satyam, we are told that the Enforcement Directorate (ED) was just getting ready to file a case when Ramalinga Raju spoilt their fun by admitting to a far bigger scandal! In all the years since the Ketan Parekh scam, the ED did not notice any of Satyam’s dubious fudging. And even after the collapse, the finance ministry merely parrots its statement in the ATR without asking for an explanation.

The cases where ‘action is complete’ because there is no contravention include Global Telesystems, Aftek Infosys, Kopran, Lupin (charge dropped), Nirma and Cadilla. Each of these companies had allowed Ketan Parekh to route funds through their books; it is not clear how these became a FEMA (Foreign Exchange Management Act) issue. Some, like Ranbaxy, are going through adjudication proceedings; Silverline and Adani paid up some fines and closed their cases. Action against DSQ remains in limbo, since Dinesh Dalmia is in jail.

The Zee group was let off with a mere warning, although there is plenty of evidence in the JPC report and a dozen ATRs on its involvement in the Ketan Parekh scandal. And, finally, the ATR categorically says that six show-cause notices (SCNs) were issued to the Bank “on conclusion of adjudication proceedings, charges against M/s Global Trust Bank in all the 6 SCNs have been dropped and the case stands closed. Hence, action against this company may be treated as complete.”

What then is the mysterious SFIO investigation that has been started against GTB? Officially, there aren’t any answers.

But the grapevine says that GTB’s promoters have probably upset some politically powerful persons by reneging on some shady deals. It is impossible to say whether this is true, but when a serious fraud inquiry is launched nearly a decade later, without any details or explanations, one can only draw conclusions. This is just another example of how people are persecuted or let off at will in Shining India. — Sucheta Dalal

-- Sucheta Dalal