CBI has initiated an inquiry into cases of defaulters of big loans from public sector banks

CBI has initiated an inquiry into cases of defaulters of big loans from public sector banks, its chief Ranjit Sinha said on Wednesday while emphasising that bulk of non-performing assets were connected to 30 defaulter accounts.

“A bulk of NPA is from top 30 accounts which is learnt to be running into thousands of crores. CBI has already initiated inquiry into some of the big defaulter accounts,” Mr Sinha said.

He did not reveal the specifics of the probe as it may derail the ongoing inquiry by the agency.

Speaking at the fifth annual conference of chief vigilance officers of Public Sector Banks and Financial Institutions and Officers of CBI, Mr Sinha cited number of issues which adversely affect agency’s efforts to track and recover these assets.

Highlighting issues which hamper CBI investigation into bank frauds, he said banks are often reluctant to declare bad accounts as fraud despite there being clear manifestations.

The CBI Chief said the banks need to realise that delay in reporting of frauds adversely affects tracking and recovery of proceeds of crimes as the initiative is lost.

Mr Sinha said the banks are often reluctant to fix accountability of their staff, resulting in difference of opinion between them and the agency regarding the role of public servants.

“In my view there should be no reason for denial of sanction for prosecution wherever malafide acts by delinquent officials caused huge losses to the banks,” he said.

Mr Sinha said bank frauds involving amount above Rs 50 crore has grown almost 10 times in two years.

“Large value frauds involving amount of Rs 50 crore and above have also increased more than 10 folds from three cases in 2009-10 involving an amount of Rs 404.13 crore to 45 cases involving Rs 5334.75 crore in 2013,” he said.

The CBI Director said with the growth of economy and banking sector, amount involved in frauds in the sector have grown substantially over the years.

“According to an analysis by RBI, while the number of fraud cases has shown a decreasing trend from 24,791 in 2009-10 to 13,293 in 2012-13 that is a decline of 46.37 per cent, the amount involved has quadrupled from 2037.81 crore to 8646 crore that is an enormous increase of 354.27 per cent,” Mr Sinha said.

The CBI Chief said according to government analysis non-performing assets of the banks have risen substantially in last two years from Rs 59,924 crore in 2010 to Rs 1,17,262 crore in 2012.