At a time when banks are facing the problem of huge irrecoverable bad loans and getting into losses due to provisions to be made from the profits earned, the PNB – NIMO fraud has exposed the increasing trend of corporate loot of banks, said C H Venkatachalam, general secretary, AIBEA.
"Attempts are being made to dilute the magnitude of the fraud", he alleged. Action against two employees at the lower level gives an impression that only the lower level officials and staff are responsible, he added.
"It is very strange that the top management and Board members of the Banks are not covered by any Disciplinary and Conduct Regulations though they take very vital decisions. They are also to be covered by the same set of rules like other officers of the Banks. The government should look into this aspect also," said Venktachalam.
He said the fraud has also raised a number of questions on technology issues, supervision, monitoring, audit, internal control, etc. besides role of RBI in the whole episode.
AIBEA also questioned how is it that the RBI, which carries out a regular audit of the banks, did not smell the fraud, despite the number of years and the volume of money involved?
The Union also alleged that the RBI has failed to fulfill its role as a regulator of the banking sector.
Questions raised by AIBEA
 "Bank Union demands CBI probe into PNB fraud, alleges RBI failed as regulator")