RBI did not conduct audit during PNB scam: CVC
Chowdary pointed out that the RBI issues general guidelines as a regulator and also when foreign exchange is involved.
New Delhi: Central Vigilance Commissioner K.V. Chowdary on Tuesday said the Reserve Bank of India (RBI) had apparently not conducted an audit during the period of time when a Rs 13,000-crore scam hit the Punjab National Bank. Mr Chowdary stressed the need to put into place a more robust auditing system.
“They did not do this (an audit),” the head of the probity watchdog told PTI. The CVC exercises superintendence over the CBI which is looking into the over Rs 13,000-crore PNB fraud case.
The RBI had the regulatory responsibility for the banking sector but any lack of integrity would be looked at by the Central Vigilance Commission, he added.
Mr Chowdary said according to the RBI, it had switched over from a periodic audit to a “risk-based” audit which is conducted when there is a financial risk involved.
“To determine risk, they must have some parameters. Based on that they would have done that (auditing), (but) there was no apparent audit by the RBI during this period (of fraud),” Mr Chowdary said.
Union Finance Minister Arun Jaitley had in February slammed regulators for failing to detect the fraud, saying that unlike politicians, regulators in the Indian system were unaccountable.
Mr Chowdary pointed out that the RBI issues general guidelines as a regulator and also when foreign exchange is involved.
“They are not going to see from branch to branch and bank to bank what they are supposed to do,” he said.