PMC Bank: Finance Minister says Govt Will Amend Laws If it Help in Better Regulation
Facing flak from several quarters on the Punjab & Maharashtra Co-operative (PMC) Bank fraud case, finance minister Nirmala Sitharaman on Thursday says if amendments help in better regulation, the union government would go ahead with the required legislative procedure in cooperative sector. While assuring customers and depositors, the finance minister also mentioned that her ministry has nothing much to do with the issues of PMC Bank but she will speak with Reserve Bank of India (RBI) governor on the distress of depositors.
"Finance Ministry may have nothing to do with it (PMC bank matter) directly because RBI is the regulator. But from my side, I have asked the secretaries of my ministry to work with ministries of rural development and urban development to study in detail as to what is happening (with PMC Bank)," the minister says in Mumbai.
Speaking to reporters at Bharatiya Janata Party (BJP)'s office in Mumbai, Ms Sitharaman said that she would meet the RBI governor Thursday evening and convey the issues and urgency displayed by the PMC Bank customers.
Earlier in the day, the Minister met distressed customers of PMC Bank in Mumbai, who were protesting outside the BJP office.
Ms Sitharaman further said that she has asked secretaries of the concerned Ministry to study in detail the shortcomings and if necessary look at ways in which the respective acts have to be amended.
She said that in the meeting to be held to decide on amendments in Act for better regulation, along with representatives from the finance ministry a deputy governor level officer of the RBI would also be present.
The finance minister says she has explained to the (PMC Bank) customers that the RBI is taking action, doing what should be done as per the law. In such instances where there is malpractice and boards get bypassed, the central bank handles the matter, she added.
During the conversation with the PMC Bank depositors, the finance minister also informed them that the finance ministry is working with rural development ministry.
The PMC Bank fraud came to light in late September, when the RBI barred the bank from carrying out the majority of its routine business transactions for a period of six months, sparking panic among the depositors and sending shock-waves in the city banking and business circles.
On Wednesday, customers of PMC Bank protested outside a Mumbai court.
Carrying placards that read "No Bail, Only Jail", they accused the RBI of not taking strict action against the erring officials and appealed to Prime Minister Narendra Modi to intervene in the matter, says a report from NDTV
Days after fraud came to light, the now-suspended managing director of the bank Joy Thomas, in a letter to the RBI acknowledged the wrongdoing, and said the bank even opened a number of dummy accounts to replace the stressed accounts held by Wadhawans-led Housing Development and Infrastructure Ltd (HDIL).
The economic offences wing (EOW) of Mumbai Police and the enforcement directorate (ED) are investigating the matter and have made few arrests and attached properties and assets so far.