by

Rajesh Goyal   

Today (05/10/2012) an article has appeared in ET under the heading  "Frivolous complaints bog down selection of public sector banks chairmen".   The whole stress in the article has been that the delay in selection of CMDs for PS Banks is merely on account of frivolous complaints against poor CMD aspirants.   The article concludes  "the government, however, blames the Central Vigilance Commission (CVC) for the delay in clearances".     Can I know, when was the final decision for lateral promotions taken?   After this decision, for how long the files are pending with CVC?  Is the delay due to CVC clearance or the hectic lobbying of manipulators in MoF for plum posts ?  There is a need to ponder on these questions to reach the bottom of the issue.   National media needs to be more responsible in side tracking the main issue of corruption. 

At AllBankingSolutions.com we have been constantly trying to give updates based on internal news and leaks (which are sometimes also planted).   All such information we share through our column Hot Talks, which is based on such leaked information that trickles from various sources.    Such information are not always final as number of lobbying groups constantly exert pressures to ensure that they are the real beneficiaries of the final decisions.    When interviews for creating the panel for CMDs were held in the second week of January 2012, it was expected that the list will be out within a week's time.  Hectic lobbying followed and matter could not take final shape even after delay of 8 months - in between even FM has changed.    

It was only at the beginning of this month that AllBankingSolutions.com was the first to take up the issue of Headless Banks.   In our Hot Talks we have mentioned about the dubious credentials of some of the CMD aspirants.    I know this website is too small to swing the pendulum on right side, but it appears it has certainly made some ripples in the corridors of power by exposing the nexus between politicians and top bankers.   Now articles giving frivolous causes for the delay have started appearing in financial newspapers.   This is mainly to shift the focus from corruption to blaming the CVC for keeping the banks Headless.

It appears the lobby of those dubious credential aspirants has upped their ante and by planting such news items, they  are trying to put pressure on vigilance institutions to clear their names in a hurried manner so as to fill up vacancies.  

Now question arises whether complaints against EDs approved for CMDs posts are always frivolous or always true.   Almost everybody will agree that both statements are incorrect.   There will be certainly some complaints which are frivolous and can be planted by other group.   However, each one of us knows that corruption in India at present has touched its Zenith.   Banking industry is also no exception.  I think the longest list of officers who are charged by CVC every month with corruption is from banks.    Banking fraternity now frequently and openly discusses the 'on going rate' for promotions to the posts of EDs and CMDs.    Can there be smoke without fire?    The amounts mentioned in such talks are mind boggling and at least I am shocked to hear such figures.   It is true that such compensation may not be necessary in all cases, but even if it is in some cases, the question is from where does such huge amounts are collected.   The only way is corruption.  

Therefore, to say that such complaints are frivolous and blame CVC for delays,  is only to skirt the issue of corruption in top circles of the banking industry.    Such news are frequently planted by the most corrupt people as they want to create an environment where CVC is put under pressure to clear their names in a hurried fashion.   If an independent survey is conducted and general perception of the officers at all levels working in such banks is sought, a majority of the CMD aspirants will be found to be in the negative list on account of perception about corruption during their tenure.    Certainly some aspirants will get kudos for clean image.  

Thus, there is a need for revamping the whole system of selection to the posts of EDs and CMDs.   If the practice of payments to political bosses for promotion to the posts of EDs and CMDs continue, then nobody can stop the corruption to collect the funds for making such payments.   When a person will indulge in corrupt practices, there will be certainly complaints by other groups.   The complaints are the only check and balancing system as the people who have paid and received money will never complaint as both of them are beneficiaries of this system.    Therefore, complaints needs to be taken seriously after filtering frivolous complaints.