Breaking his silence over Rs 11,400 crore PNB fraud, Union finance minister Arun Jaitley on Tuesday questioned the failure of bank management and auditors to detect such massive frauds when the government had given full autonomy to them. He added that it is essential for the State to chase these fraudster till its last capacity to make sure that the country is not cheated.
“When authority is given to the managements you are expected to utilise that authority effectively and in a right manner. Therefore the question for the management itself is were they found lacking? And on the face of it the answer seems yes they were,” he said, adding that the banks were “unable to check who amongst them were delinquent”. He went on to ask what the auditors were doing. “Both internal and external auditors really have looked the other way or failed to detect,” he said.
Mr Jaitley pointed out bank frauds have a cost to the country as well as to the tax payer. “It’s a direct cost and it has an indirect cost that it impinges on development, which impinges on the lending capacity of banks as an institution and therefore impinges upon developmental finance,” Mr Jaitley said.