.....The skeletons are coming out of the closet. A series of exposés by Cobrapost has made Indian financial institutions look extremely vulnerable to money laundering activities. Small, as well as large financial institutions look deficient in anti-money laundering policies that they are supposed to be strictly implemented and followed. Globally money laundering activities have been rampant.......
The very purpose of VITALINFO is to provide a platform for wider dissemination of updated information related to and happening of events in and around RBI.
Monday, May 13, 2013
Gogoi against cash for cheated investors
........The Assam chief minister’s comments came a day after the Reserve Bank of India governor questioned the fairness of the Bengal government’s proposal to levy additional tax on cigarettes to compensate the cheated investors of the Saradha Group. “If you go back to the West Bengal Saradha scheme, the chief minister said: ‘I will levy additional taxes on cigarettes and some other things to compensate the people who have lost money.’ Is it fair?” Subbarao had said in Srinagar. In Delhi today, Gogoi blamed “lack of regulations” by the RBI, Sebi and the registrar of companies for the mushrooming of “chit funds”..........
Saradha-like companies leave authorities perplexed
.........Even as various ministries, government departments and regulators such as Ministry of Corporate Affairs (MCA), Serious Fraud Investigation Office (SFIO) under the ministry, Department of Financial Services (DFS), the Reserve Bank of India and Securities and Exchange Board of India (SEBI) are brainstorming on the issue, officials involved say they are finding it difficult to nail down unauthorized collection of funds by numerous small time and fly-by night operators...........
After Saradha scam, investors may turn to safer havens
.....lack of proper regulation and the failure of formal financial institutions, including banks, to penetrate into rural areas were the key reasons for mushrooming of such schemes across the State. “Penetration of bank branches in the rural and semi-urban areas is poor, particularly in the East and North-Eastern parts of the country. The concept of business correspondents suggested by the Reserve Bank of India has also not taken off too well in these regions,”.......
Over 100 detained in chit fund raids
.....The crackdown, which started on Friday last week, was meant to verify the documents of NBFCs to ascertain whether they are operating with the approvals of Reserve Bank of India (RBI) and Securities & Exchange Board of India (SEBI) and to collect data about the volume of money they have collected from the depositors............
RBI fails to monitor money laundering by banks
.............."Given that a chunk of life insurance money goes toward buying government securities, is there a conflict of interest for the RBI as the government debt manager? It is easier to turn a blind eye to institutional miss-selling. Also, why did it take our magazine to expose such practices by so many bank employees? Why weren't the KYC norms followed by the banks?" Bahal asked. An email query sent to the RBI on the issue remained unanswered when the story went to press.
RBI gears up for plastic notes
......The proposed launch follows years of consultations over the feasibility of plastic notes in the country. Way back in early 2000s, the RBI had rejected a similar proposal, but it later began working seriously on trying out plastic notes, given their high longevity and growing menace of paper bills getting soiled and the rising costs of their disposal. At the same time, the successful launch of plastic notes across various countries has also led to a serious thought over similar practices in India, experts say, while adding that the concerns over greater possibility of counterfeit notes in plastic format have also been addressed to a large extent..........
Why India Post should get a banking licence
.....With this background, India Post should be the fittest candidate to establish a bank if indeed RBI wants financial inclusion, as no other public and private entity can compete with it in terms of reaching out to the rural masses. It is familiar with the art of deposit taking; has personalized relationships with rural folks who do not yet have access to Internet; and even though it does not directly invest in government bonds, it will not have any problem in fulfilling the statutory requirement of buying government bonds as it has been contributing to the consolidated fund of India. All it needs is to convert part of it into exposure to government bonds.......
Asia's Best Analysts: Banks
........Mr. Shah remains bullish on the banking sector for 2013, given the Reserve Bank of India's monetary easing policy, which is likely to result in higher loan demand by both corporations and individuals. The RBI is also expected to allot its much-discussed private bank licenses, which will be an event to watch for the sector, he said.
Decades later, Dharavi remains a maze for banks to crack
...............It is this milieu that banks have been trying to tap for decades now, hoping to move money from the huge parallel cash economy into the banking system. They have been opening branches and engaging novel methods to expand presence. But taking basic banking to the urban poor has proved easier than convincing them to use the facilities. A sparsely furnished State Bank of India (SBI) branch in Dharavi is smaller than most of its branches in the city, but more crowded with migrant labourers and small entrepreneurs on any given day............
Doha Bank seeks India base
.....Qatar-headquartered Doha Bank is looking at setting up base in India and is awaiting clarifications from the Reserve Bank of India to set up a branch network across the four metros, perhaps this financial year. Mohammed Akram Hashim, Head, Retail Banking, Doha Bank, a participant at the Business LineOpportunities Fair, said that with the RBI now looking at licensing Indian corporates to set up banks, the issue of foreign banks seeking licences is likely to be taken up. The policies for foreign banks differ and the bank is seeking clarity.......
Fundamental triggers missing
.....Changes in interest rates alone may not be enough to spur growth; the supply side of the economy needs to be stimulated. For this, either the government should increase its investment spends or create an environment to increase the confidence levels of the private sector to begin investing. Given that elections are just a year away and in fact may be held by this year end, it is unlikely that any significant improvement can be seen in policy making or real reforms for the private sector to invest for growth............
Cyber cheats hacked Pune, Bangalore companies
......Bankers say that although RBI has guidelines on outsourcing of banking functions, evolving technology makes it difficult to draw clear lines. RBI has sought to address this issue by making it clear that even in outsourced transactions, it is the bank that will be held responsible........
Samajwadi Party demands fair deal to farmers
.........The party also demanded that action should be taken against the private and public sector banks which violate the RBI guidelines as far as lending agricultural loan to farmers was concerned. Besides, a CBI inquiry should be ordered into alleged corruption in 2008 loan waiver scheme where thousands of the farmers of the State had been duped by the micro finance organisations and non-government organisations.............
No ‘green shoots’ for India Inc
......Overall, if there is a message for India Inc from this quarter’s scorecard, it is to consider some belt-tightening measures of its own, instead of perpetually looking to the Reserve Bank of India to deliver policy rate cuts.......
Banks Off to Dubai on Winsome Trail
....Significantly,
RBI has voiced concerns that if Indian banks refuse to honour the
bullion banks’ payment demands, it could be construed as sovereign
default..............
Trade Opportunities between India and Sudan
...While answering the queries from members of Sudanese Businessmen & Employers Federation, Ambassador Verma explained that Reserve Bank of India has no directives to dishonor LCs from Sudan. The Government is looking into this issue to come out with a comprehensive solution.........
Saturday, May 11, 2013
Once was king
If Manmohan Singh had retired in, say, 2010, his legacy would have been assured. A man who worked his way up from a small Punjab village to Cambridge; who became chief economic advisor at 40, Reserve Bank of India governor at 50, and finance minister before 60; and, finally, the only prime minister since Jawaharlal Nehru to be re-elected after completing a full five-year tenure............
Glare on ex-RBI official's Ponzi links
.....The investigators said that they cross-examined a recently-retired RBI official who was allegedly instrumental in shielding Saradha boss Sudipto Sen's from the regulatory scanner. Ponzi scamster Sudipta Sen's interrogation unearthed dubious role of a section of senior Bank officials and officials of Sebi, admitted police. Investigators have already examined a recently retired RBI official, who allegedly was instrumental to shield Sen's chit-fund trade from regulatory scanner........
HDFC Bank, Petty misappropriations – How much are they worth?
Dear Dr. Subbarao,
SUB: Response to letter sent by the “Department of Banking Supervision” of RBI
I thank you and the Department of Banking supervision for forwarding my complaint dated October 16, 2012 to which the bank did not reply to me but only filed a copy of the letter with you. Thus I also thank you for sending me a copy of their reply. The reply is misleading, factually incorrect and an expert exercise in deception. I will try to illustrate this below, and hope for once the RBI will act not as a post office forwarding letters and complaints to banks expert in cheating the public but will take proactive action, at the very least to investigate if the charges levied by me have any merit..........
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