Nimish Shukla

Ahmedabad, April 11: UNITED Forum of Bank Union, a supreme body of the nationalised banks, in a written memorandum to the Finance Minister Yashwant Sinha has demanded a thorough probe into the Madhavpura Mercantile Cooperative bank (MMCB) and bullion scandals by a Supreme Court judge.

In a signed statement the union has urged that on the basis of the findings of the probe, all the guilty persons should be booked in the greater interest of the nationalised banks and the nation. The union noted with grave concern that if the worst apprehension proved true, the nationalised banks will be hit by Rs 1,200 crore in the infamous scam. They also apprehended a nexus between the stock brokers, bankers, RBI and SEBI in the stock market scam and felt that a handful of elements used the MMCB as a front and duped the nationalised banks. Comparing the KP show with the Harshad Mehta episode of 1992, the union raised some question against the regulatory role of RBI and SEBI in the light of experience of 1992 securities scam.

The union also expressed surprise as to how a small cooperative bank like MMCB could issue pay orders of thousands of crore rupees to a particular share broker and it allied concerns and how the pay orders discounted by the public sector banks can be returned by RBI midnight and even after couple of days of their presentation.

The Union also said that is it not an attempt of RBI to accommodate the defaulting bank (MMCB) at the cost of nationalised bank. The Union blamed that the mess is the result of the failure of supervisory and regulatory role of the RBI and criticised the stock market watchdog for remaining a mute spectator when a particular stock broker was manipulating the market in a big way. The forum also observed that the PSU banks are still not totally equipped to deal with the intricacies of the bullion business.

It alleged that with a view to diverting the attention of the people from the truths behind the scam, some superficial measures of suspending few lower level officials has taken place, but the high and might are still scot free.