Imagine you being locked out of your savings, all your hard-earned money gets unusable with just an announcement.

No I’m not talking about Demonitization.

I’m talking about the Punjab & Maharashtra Co-operative Bank, the one whose operations got restricted by RBI due to high risks on 24 September.

People can now withdraw only ₹1000 from their accounts over a period of six months. Your own money is now locked in a bank which you cannot use. 

The Bank isn’t allow to open new branches, renew fixed deposits, invest money and take fresh deposits.

After a lot of pressure from the public, the limit was increased to ₹10,000 but it is not a huge relief for the people, especially the common man and businessmen having current accounts. ₹10,000 will barely get you to survive with your family for a few weeks. Those who had saved for weddings or a new house must be facing huge problems as well.

What led to this decision by RBI?

This chaos happened just because of one bank account

The account was of HDIL, a real-estate firm which is now bankrupt, who owes the bank ₹2,500 crores. The auditors at PMC bank did not classify this loan under NPA (Non-performing asset) despite HDIL defaulting on loan payments.

RBI had to step-in and put restrictions citing several regulatory lapses especially heavy underreporting of NPAs.

The video below explains the scenario, including what would happen to the money of PMC Bank Customers: 

A Bigger Fraud Than The Nirav Modi Fraud

The article explains how the current chairman of the bank Waryam Singh was director on the board HDIL till 2015, and earlier the director on board of DHFL. Both the companies are promoted by brothers, Saran and Kapil Wadhawan. 

It further states that it might be possible that the management misreported the sector of the loans they have provided. This failed to come in the attention of statutory auditors.

PMC faked loan records to under-report the NPA and presented to RBI. It also deliberately kept NPA information hidden from RBI.

It is also possible that HDIL created a number of small companies due which they failed to come under the notice of RBI’s database of large stressed loans, CRILC (Central Repository of Information on Large Credits).

Bigger Co-operative banks such as PMC are supervised every year. It would be difficult for RBI to explain why this blunder happened.

Suspended MD has admitted PMC bank was breaking RBI rules since past 6-7 years and had a long relationship with HDIL.

Co-operative Banks used by politicians as their personal piggy banks

This twitter thread by @memeghnad explains how this has been happening since years now:

In case you’re wondering how politicians use cooperative banks as their personal piggy banks, here’s how it works.

#PMCbank thread 👇
Step 1: People known to politicians are appointed as directors. Can be a son/daughter/friend/peon/driver.

They’re all just proxies so it doesn’t matter whether they are educated or not. They don’t even need to pay attention to the functioning of the bank.
Step 2: Entice hardworking people to deposit their money in this bank.

Pretty self-explanatory.
Step 3: Give out loans from the bank to friends and family.

Since the directors are ‘apne ghar ke log’, this is quite easy to do. Doesn’t matter if the entity they are giving loans to has the capacity to pay back or not. Of course.
Step 4: Feed fat lunches to auditors (Chartered Accountants) during audits to make them look the other way.

Yeah. These audits are a joke. Starving underpaid interns do it mostly. Nobody ever blames the CAs after shit goes down, so who cares anyway.
Step 5: Give a nice cut from the loans to party and leader as donations.

Again, pretty self-explanatory. Now we have these fun things called electoral bonds to ensure these things are anonymous too! So… yaay!
Step 6: Never pay back loans. Instead, take more loans to start paying back installments of previous loans.

Yeah. They take more loans to pay back parts of previous loans so that they always stay above the NPA radar. Managers know this, but… meh.
Step 7: PROFIT!!!

Of course.
In this amazing wonderland, shit usually goes down when the party in power changes & elections are on the horizon.

Then, suddenly, authorities take a look at the books, find shittiness happening there for years and then take action. Once elections are over, rinse and repeat.
You can already see this happening.

Election times are fun times.
*ba dumm tss*

ED Registers case against Sharad Pawar, 70 others in Maharashtra cooperative bank fraud case:
 https://www.moneycontrol.com/news/business/ed-registers-case-against-sharad-pawar-70-others-in-maharashtra-cooperative-bank-fraud-case-4471211.html …
And, of course, everybody is involved.

Look closely and you’ll find connections to every party that matters, one way or another.

Day After Payout Freeze PMC Banks Link With BJP Emerges:
 https://mumbaimirror.indiatimes.com/mumbai/other/day-after-payout-freeze-pmc-banks-link-with-bjp-emerges/articleshow/71302355.cms …
Now, look at this lady. Look at her closely. Feel her pain.

People like her are the ones who suffer because of this giant scam which has been happening for decades.

https://twitter.com/i/status/1176860652649926656
For the past few days people who have read my book are pointing out similarities with #PMCbank and how I predicted the future.

Trust me, I didn’t. This has happened before.

But hey, buy my book #Parliamental! Thnx!  https://www.amazon.in/dp/935357059X/ref=cm_sw_r_cp_apa_i_qOeJDbEM89KQB …
How in the world can this fraud go on for 10 years without anyone red flagging it?!

#PMCbank gave 73% of ALL its loans to ONE company, which went bankrupt, and nobody noticed? How is this even possible!
 https://economictimes.indiatimes.com/industry/banking/finance/banking/over-two-thirds-of-pmcs-loan-exposure-is-in-hdil-group/articleshow/71367179.cms …

You can follow @Memeghnad.

The cycle will continue, while the government amends laws to make everything as secretive as possible.

https://twitter.com/paranjoygt/status/1021617434275598336
https://twitter.com/ShekharGupta/status/1153334657032699907

Why do the common people have to suffer?

Lakhs of people are having sleepless nights over this decision. People have their savings accounts, current accounts, fixed deposits and what not in the bank while the bank refuses to give them their own money back.

Look at some accounts below which will sadden you while we clearly cannot do anything regarding the same.

When Demonitization happened, one of it’s main motives were said to be to digitize, encourage and increase cashless economy. People were forced to deposit all their savings in banks. Now that you have all your savings in the bank, you cannot withdraw them. 

Home isn’t safe to store money.

Banks aren’t safe to store money.

Where do people keep their money then?

This has happened earlier with many other banks as well. 

While the RBI and bank officials who are responsible roam free without worries, it is the common man who bears the pain every time. 

Do we need to get Bank’s KYC now just like they forcefully took ours?

As the largest democracy, the government should atleast accept that it was a failure on someone’s part and hold someone responsible. You just cannot lock away savings of common people like that. 

Finally, a SIT has been formed to probe the case. I hope people get justice and their own money back. 

But regardless of the economic slowdown India is facing along with Kashmir Blackout, Modiji tells the NRIs “All is well. Sab changa si. Maja Ma Chhe.”


Gunkaar Singh

I'm 21. I started this blog in 2018 with an aim to improve my content writing skills. Left my job recently to fully focus on Content Writing. I also write on Linkedin, Medium and Broadcast Lists App as well. Reach out at gunkaar.singh17[at]gmail.com for any further queries.

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