Former Reserve Bank of India governor Raghuram Rajan said he had given a list of 10 big nonperforming assets (NPA) fraudsters to the prime minister's office (PMO) but the government has not taken any action on it.
"I do not know what has happened so far," Rajan told CNBC-TV18. "The idea was that the 10 biggest fraudsters should be identified and to take special action against them."
If one or two are brought to justice, it sends a message that the government will come after fraudsters and ensure they face penalties, He said.
“Unfortunately, the tendency has been that these things take a lot of time before they label frauds,” Rajan said, adding that once the government label frauds, it takes forever to follow the money trail and to get anything that convinces foreign courts as many of the fraudsters have gone abroad.
“My worry is that a lot of frauds go un-penalised,” Rajan added. The bankers are interrogated and some are in prison but the criminals on the other side typically get away, according to the former RBI chief.
“There has to be a sense that they will be punished otherwise we will see an escalating level of frauds,” he said.
In a note to Parliament's Estimates Committee on NPAs of public sector banks, Rajan said a larger NPAs originated in 2006-2008 when Indian economic growth was strong as the banks made mistakes.
First Published: IST