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HEY SCAM – HEY RAM

Contents: Ten examples of recent scams in India - Discussion of recent

examples - The Prevention of Corruption Act 1988 and Indian Penal

Code – Typology of Corruption - Consequences of Corruption –

Citizen‟s Charter - Anti-corruption movement of Anna Hazare

10 Examples of Corruption Scams in India

Since the 1990s several scams and big corruption cases have been

unearthed in India. It is seen that these scams were the biggest and most

damaging to the country and its citizens alike.

In our daily life, most of us must have been a witness to or a victim of

the corruption thriving in some or the other part of our country. It could

be in the form of a taxi-driver manipulating the meter to jack-up the

reading or a government officer taking bribery to promptly transfer your

file to the next department or even yourself offering bribe to a traffic

police on breaking a signal.

An average Indian citizen is hard working and diligent, but it is the

people in charge of the system (The Babus) or with whom the power

rests, that act tough as a cancer spreading and slowing down progress.

But, somewhere down the line, we ourselves are responsible for

allowing and being taken for a ride by these people, aren‟t we?

However, it is during a multi-thousand crore scam, that a tax-payer

actually realizes the heartburn of being cheated from his valued

contribution of funds towards the development and well-being of the

nation. But, that‟s what a scam, be it big or small, means – the act of

swindling by some fraudulent scheme or action.

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Ten Scams in twenty years of free India

1) 2G Spectrum Scam

We have had a number of scams in India; but none bigger than the scam

involving the process of allocating unified access service licenses. At the

heart of this Rs.1.76-lakh crore worth of scam is the former Telecom

minister A Raja – who according to the CAG, has evaded norms at every

level as he carried out the dubious 2G license awards in 2008 at a throw-

away price which were pegged at 2001 prices.

2) Commonwealth Games Scam

Another feather in the cap of Indian scandal list is Commonwealth

Games loot. Yes, literally a loot! Even before the long awaited sporting

bonanza could see the day of light, the grand event was soaked in the

allegations of corruption. It is estimated that out of Rs. 70000 crore

spent on the Games, only half the said amount was spent on Indian

sportspersons.

The Central Vigilance Commission, involved in probing the alleged

corruption in various Commonwealth Games-related projects, has found

discrepancies in tenders – like payment to non-existent parties, will-ful

delays in execution of contracts, over-inflated price and bungling in

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purchase of equipment through tendering – and misappropriation of

funds.

3) Telgi Scam

As they say, every scam must have something unique in it to make

money out of it in an unscrupulous manner- and Telgi scam had all the

suspense and drama that the scandal needed to thrive and be busted.

Abdul Karim Telgi had mastered the art of forgery in printing duplicate

stamp papers and sold them to banks and other institutions. The tentacles

of the fake stamp and stamp paper case had penetrated 12 states and was

estimated at a whooping Rs. 20000 crore plus. The Telgi clearly had a

lot of support from government departments that were responsible for

the production and sale of high security stamps.

4) Satyam Scam

The scam at Satyam Computer Services is something that will shatter the

peace and tranquillity of Indian investors and shareholder community

beyond repair. Satyam is the biggest fraud in the corporate history to the

tune of Rs. 14000 crore.

The company‟s disgraced former chairman Ramalinga Raju kept

everyone in the dark for a decade by fudging the books of accounts for

several years and inflating revenues and profit figures of Satyam.

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Finally, the company was taken over by the Tech Mahindra which has

done wonderfully well to revive the brand Satyam.

5) Bofors Scam

The Bofors scandal is known as the hallmark of Indian corruption. The

Bofors scam was a major corruption scandal in India in the 1980s; when

the then PM Rajiv Gandhi and several others including a powerful NRI

family named the Hindujas, were accused of receiving kickbacks from

Bofors AB for winning a bid to supply India‟s 155 mm field howitzer.

The Swedish State Radio had broadcast a startling report about an

undercover operation carried out by Bofors, Sweden‟s biggest arms

manufacturer, whereby $16 million were allegedly paid to members of

PM Rajiv Gandhi‟s Congress.

Most of all, the Bofors scam had a strong emotional appeal because it

was a scam related to the defense services and India‟s security interests.

6) The Fodder Scam

If you haven‟t heard of Bihar‟s fodder scam of 1996, you might still be

able to recognize it by the name of “Chara Ghotala,” as it is popularly

known in the vernacular language.

In this corruption scandal worth Rs.900 crore, an unholy nexus was

traced involved in fabrication of “vast herds of fictitious livestock” for

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which fodder, medicine and animal husbandry equipment was

supposedly procured.

7) The Hawala Scandal

The Hawala case to the tune of $18 million bribery scandal, which came

in the open in 1996, involved payments allegedly received by country‟s

leading politicians through hawala brokers. From the list of those

accused also included Lal Krishna Advani who was then the Leader of

Opposition.

Thus, for the first time in Indian politics, it gave a feeling of open loot

all around the public, involving all the major political players being

accused of having accepted bribes and also alleged connections about

payments being channelled to Hizbul Mujahideen militants in Kashmir.

8) IPL Scam

Well, I am running out of time and space over here. The list of scandals

in India is just not ending and becoming grave by every decade. Most of

us are aware about the recent scam in IPL and embezzlement with

respect to bidding for various franchisees. The scandal already claimed

the portfolios of two big-wigs in the form of Shashi Tharoor and former

IPL chief Lalit Modi.

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9) Harshad Mehta & 10) Ketan Parekh Stock Market Scam

Although not corruption scams, these have affected many people. There

is no way that the investor community could forget the unfortunate Rs.

4000 crore Harshad Mehta scam and over Rs. 1000 crore Ketan Parekh

scam which eroded the shareholders wealth in form of big market jolt.

Discussion of recent examples of misappropriation of public funds /

trust and remedies:

Barely had the dust from the Commonwealth Games exposes

settled, which brought infamy to the country before the international

community, the country has been rocked by a series of scams which has

undermined public trust like never before. What is interesting is that

corruption has become a common malaise afflicting all political parties

and no party can claim the moral high ground.

The season of scams has once again set over us in India. Every week

there is a new scam which is unearthed by the media who then go to

town with the stories. But this scam season should even hit the hardest

cynic and make him think about where as a nation we are headed. All

and sundry have been implicated in these scams from the usual suspects

like our politicians and bureaucrats to the more unusual suspects like

senior Defence personnel and still every day we hear new names coming

up in the context of these scams.

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The season was kicked off by the now “world famous” Common

Wealth Games Scam where a certain Mr.Kalmadi and his lackeys made

off with crores of rupees meant to be spent on the games. According to

estimates an amount of almost 70,000 crores was spent on the games and

it is hard to imagine where all this money went.

Then we have the Adarsh Housing Society Scam where flats

and apartments meant to be given to the relatives of soldiers who gave

up their lives fighting for the country in the Kargil war. But instead these

flats and apartments in high end South Mumbai landed in the hands of

politicians, babus and senior Defence officers.

And then of course we have the 3G scam with telecom licenses

for operating 3G services in the country were given out at a much lower

than the market rate. The total revenue loss caused to the Government

due to this underselling is already estimated to run into thousands of

crores.

The media of course took up these issues and shouted at the top of

its voices. The Government finally decided to act. Kalmadi lost his place

as a Secretary in the Congress, Ashok Chavan resigned as the Chief

Minister of Maharashtra and now the Telecom minister A Raja has also

put in his papers after he was forced to resign. And now some

committees will sit on these scams and after 10 years submit a 10,000

page report which nobody would care about.

The main problem we have is that just by giving up their public

offices these politicians feel they have now come clean. The question

when will people like these actually spend some quality jail time and

their assets are confiscated? In China they hang people for corruption

and in India they just give up public office and all is hunky dory. It is

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time that the common man stood up and made his voice heard and these

politicians are actually punished.

The latest scam to shock the country is the 2G Spectrum allocation,

which has been called the mother of all scams causing a combined loss

to the exchequer of Rs 60,000 crores. Though the controversy has cost

Telecom Minister A Raja his job, as he was forced to resign, it continues

to rock the parliament and the nation with Prime Minister Dr Manmohan

Singh making a fervent appeal to the opposition to forget the issue and

let the parliament function in the true spirit of democracy.

A few weeks ago, the chief minister of Maharashtra state

Ashok Chavan resigned after his involvement in Adarsh housing scam, a

land grab in the name of Kargil war heroes.

Another important state in the country too is convulsed by

corruption scandal and this one is ruled by the opposition Bharatiya

Janata Party. Karnataka Chief Minister B S Yeddyurappa has been

facing allegations of nepotism and cronyism in favouring close family

members with allotments of plots of land at prices much lower than

market rates. He is continuing in office in defiance of his party.

Saying that corruption is deep-rooted in India will be an

understatement. Once the dust settles on the current scandals, new ones

will break out, with equal vehemence and of same size.

The main reason for the sordid state of affairs is that the country

has no serious laws to punish the guilty. Resignation from the ministerial

position is considered the biggest punishment, while the culprits loot

millions of dollars and are left to enjoy them in peace.

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Sonia Gandhi, the president of the ruling Congress party summed

up the mood of the nation when she said a few days ago that though the

economy is dynamic, the country‟s moral universe seems to be

shrinking. “Graft and greed are on the rise. The principles on which

independent India was founded, for which a generation of great leaders

fought and sacrificed their all, are in danger of being negated,” she said.

Further discussion

India is amongst the most corrupt countries of the world with a score of

only 2.7 out of 10 and ranks 71st amongst 102 countries in 2002.

CORRUPTION PERCEPTION INDEX AND RANK OF INDIA, 1995-

2002

PEOPLES’ PERSPECTIVE

Indians think that corruption cannot be eliminated in India – at

least not in their lifetime. This pessimistic and cynical perception of the

people is largely an outcome of confusing corruption with all kinds of

illegal actions and activities like dishonesty, cheating, duping etc. Most

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illegal actions, many of which are private actions, are confused with

corruption.

The Prevention of Corruption Act 1988 and Indian Penal Code

clearly distinguishes between corruption indulged by public servants for

private gains and illegal actions by individuals.

There are separate Acts in India for dealing with different kinds

of illegal actions of private individuals. For example, if a public servant

amasses wealth disproportionate to his known sources of income then he

can be tried under Prevention of Corruption Act 1988. However, if a

businessperson amasses wealth disproportionate to his known source of

income he will be dealt under Income Tax Act for concealing his income

and not under Prevention of Corruption Act.

TYPOLOGY OF CORRUPTION

Corruption is defined as the use of public office for private gains.

Scales of corruption can be Grand, Middling or Petty and payment of

bribes can be due to collusion between the bribe taker and the bribe

giver, due to coercion or even anticipatory.

Existence of corruption implies that there are corrupt people, there

are also corrupt practices, and there is a corrupt system. Therefore, all

the three have to be fought simultaneously to eliminate the vice of

corruption.

The present system provides for taking on the corrupt persons

through a legal mechanism, which has not been found to be very

effective. Many corrupt practices fall outside the purview of existing

laws and need to be tackled by people themselves.

The responsibility for dealing with corrupt people, corrupt

practices and corrupt systems devolves equally on individuals, civil

society institutions, legislature, executive, and the judiciary.

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Corruption as an issue is receiving focused attention due to several

scams exposed in recent times and democracy in India has a strong

capability for debate now due to an independent press, electronic media

and the information and communication technology revolution. India

has delivered well on reforms and aroused economic aspirations for

betterment have led to political demands for politicians to deliver yet

more. This suggests that voters will look to vote for the politicians who

can deliver growth.

On corruption, Jagadish Bhagavati, an eminent development

economist, has said that the menace can be dealt by institutional reforms

and use of science. As an example, he cited the government initiative of

giving electronic identity cards to the poor. He said Nandan Nilekani is

engaged in "arguably the most important innovative reform in recent

years by creating a national database of identity details of Indian

citizens. This should take the political corruption out of the Public

Distribution System and in the Employment Guarantee Scheme.

As per perception of the people, Police is the most corrupt

sector. However, the impact of corruption is on a much larger scale in

the Health and Education Sectors involving far greater number of

population.

Corruption in Health and Education deprives people of these

basic facilities and affects human development. These are, co-relates of

Human Development. Cross country data of 102 countries show that

there is a high rank correlation (0.788) as well as coefficient of

correlation (0.766) between Human Development Index (HDI) and

Corruption Perception Index (CPI). Countries with low scores in CPI

have low HDI.

Civil Society organisations can raise awareness among the

populace and act as catalysts. Cause for corruption is certainly not

continuing „low salary‟ of those indulging in corruption. It is the lack of

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effective deterrence in the form of punishment to the corrupt and the

lack of adequate supervision.

The fact that money is being demanded directly and openly by the

corrupt is a clear indication that the corrupt persons are confident that no

worthwhile action can be taken against them. This reflects the fact that

those guilty of corruption do not expect to be hauled up. The existing

systems for identifying the corrupt and punishing them appear

ineffective and provide no deterrence to those indulging in corrupt

practices.

Perceptions at best are indicative of the existing malaise in the

systems. However, for prioritizing issues, formulations of policies and

planning strategies hard data is a requirement. Policies and programs

should not be based on perceptions alone.

Consequences of Corruption

Corruption is found to be one of the most damaging consequences of

poor governance characterized by lack of both transparency and

accountability. Corruption lowers investment and hinders economic

growth and human development by limiting access to basic social

services as well as increasing the cost of their delivery. It also increases

poverty, subverts the financial system,, and undermines the legitimacy

of the state. Thus, corruption is anti-poor, antidevelopment, anti-growth,

anti-investment, and inequitable. The cost of corruption to a nation is

very high.

At present, 19.5 million people hold public office with central and

state governments, quasi-central and quasi-state institutions, and rural

and urban local bodies spread over 200,000 establishments and offices

all over India.

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At present, the perception is that government can eradicate

corruption and responsibility for eradicating corruption

is that of government alone. However, in view of the kind of corruption

and the framework that we have in India, it is very clear that government

alone cannot eradicate corruption. If the people and civil society

institutions remain indifferent and show helplessness in combating

corruption then it can never be eradicated or for matter that even

reduced. Thus, the responsibility and the onus of combating corruption

are as much of the people and the civil society institutions as that of the

government.

Prevention of Corruption Act 1988

To deal with corruption amongst public servants India enacted

Prevention of Corruption Act 1988 (PCA 1988), replacing Prevention of

Corruption Act 1947.

PCA 1988 incorporates provisions of chapter IX of the Indian

Penal Code to deal with Public servants and those who abet them by

way of criminal misconduct and provides to enable attachment of their

ill-gotten wealth obtained through corrupt means. This act also widens

the scope of definition of Public servants.

Public servant means any person in the service, pay of the

government, or remunerated by the government by fees or commission

for the performance of any public duty. Public duty means a duty in the

discharge of which the state, the public, or the community at large has an

interest. The „State‟ includes a corporation established by or under a

central, provincial or state act or an authority or a body owned or

controlled or aided by the government or a government company

defined in section 617 of the Company‟s Act 1956. In India in addition

to a large number of health and educational institutions, the government

also aids many other kinds of organisations. Hence, the employees of

such bodies are also covered by this act.

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Normally corruption is defined as using public office for private

gains. In PCA 1988 Public Servant and Public duty have very wide

definitions covering every person who is in the actual possession of the

situation of a public servant and discharging public duty which the state,

public or the community at large has a interest. Persons holding various

public offices are public servants, whether appointed by the government

or not.

Citizens Charter

The concept of Citizen Charters has been introduced to improve the

quality of public services. It ensures accountability, transparency and

quality of services provided by various government organistions. It

enables citizens to avail of services with minimum hassle, in reasonable

time, and at a minimum cost. Effective implementation of Citizens

Charters will go a long way in controlling corruption. The Government

of India has launched an ambitious programme for formulation and

implementation of Citizens Charters in all government departments.

To oversee the implementation and diffusion of these Charters, there

must be Watch/ Monitoring Committees consisting of both public

service providers and service receivers.

Anti-corruption movement of Anna Hazare

Model Village as contemplated by Gandhiji was brought in reality by

Shri Annaji at Ralegan Siddhi by his dedication. “Late Shri Achyutrao

Patwardhan, the great freedom fighter, suggested to the government of

Maharashtra that to commemorate the golden jubilee of Bharat Chhodo

Andolan, it would be most befitting to create model villages like

Ralegan Siddhi in every tehsil of the state. The government accepted this

suggestion and declared to implement “Adarsh Gaon Yojana”. The

Government entrusted this responsibility to him and Adarsha Gaon

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Yojana was started under his leadership. He travelled whole of

Maharashtra and selected 300 villages to implement this scheme. While

working in this scheme he realised that development is getting hampered

due to planned corruption in Government machinery and he decided to

fight against this corruption. He gave evidence against two ministers

who had amassed wealth disproportionate to their income.

However since the Govt was passive about this he started agitation and

undertook fast for l0 days. Chief Minister intervened and he deleted

these two ministers from ministry and appointed an Inquiry

Commission. The Commission held both the ministers guilty but to save

them the Govt appointed another commission who discharged them from

the allegations. Though the ministers were discharged from the

allegations, they had to lose their ministership which is the success of

Mr.Hazare's agitation. Mr. Hazare's gave evidence of corruption by

Social Welfare Minister to the then Chief Minister. On 3lst July l999 the

Chief Minister informed him that inquiry is being instituted about the

charges leveled by him. He had given an interview to a local daily

regarding this inquiry and based on this interview the concerned minister

had filed a case in the court against Mr. Hazare for defamation. He was

held guilty by the Court and the court had asked him to give an

undertaking that he will not make such allegations in future. He refused

to give such undertaking and preferred to go jail for 3 months as ordered

by the court. He told the court that He was willing to give his life for

truth. His punishment created commotion in public and scores of people

started visiting Yerawada Jail. He wanted to complete his jail term but to

give respect to the public feelings he accepted his release. In l992

Gandhji had told the court that if court feels that his actions for the

freedom of the country are considered as anti-government activities he

was willing to undergo any punishment .Similarly he did not give bond

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to the court and accepted punishment. He did not prefer any appeal

against the court order immediately but due to public pressure he later

made an appeal which was upheld by the Higher Court and rejected the

suit of minister. Mr. Hazare asked the Govt. to conduct the inquiry

against the minister which is still on. In the regime of coalition

Government of Congress and National Congress Party, He had

forwarded evidence of corruption about 4 ministers and had asked the

Government to conduct inquiry. One of the ministers had made

allegations about corruption in the institutions in which he was

associated. Since there was no action from the Govt. he undertook fast

for 9 days in August 2003 at Azad Maidan. The minister concerned also

started agitation at Azad Maidan in Mumbai. At last the Government

relented and Retired Supreme Court Judge Shri P.B. Sawant was

appointed to conduct the inquiry.

The commission conducted the inquiry and sent its report to Govt. on

22nd Februrary. In the report the commission had observed ministers

guilty and had held Mr. Hazare also guilty for irregularities but not a

single charge of corruption was proved against him. Mr. Hazare has

offered the Government that it should take action against him as well as

the ministers based on the findings of the enquiry commissions. Though

Govt has not taken any action on the Commission's report three

ministers had to go and this is a big achievement of his agitation against

corruption. He felt that corruption will not stop merely by taking action

against a few officers and ministers and it is necessary that a change

should be brought about in the system. He believes that unless

decentralization of power takes place the system will not change. In

order to bring change in the system he felt that information should be

made available to people regarding Govt.'s actions which was not being

provided to people on the ground of secrecy. Here again he decided to

follow Gandhiji's path and started Maun Vrat and later fast unto death.

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This brought pressure on the Govt. and both the Central as well as State

Governments have enacted Right to Information Act. His whole life and

work is based on Gandhian philosophy.