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MPs, MLAs to face heat in bank losses investigation

The who’s who of state politics will soon be in the hot seat to face an inquiry into the Rs 252-crore losses incurred until mid-2011 by the Maharashtra State Cooperative Bank (MSCB). The bank’s board of directors, responsible for making decisions till its dissolution in 2011, had members of the state cabinet led by Chief Minister Prithviraj Chavan and other legislators and ministers, mostly from the Nationalist Congress Party (NCP). 

The MSCB directors’ board was dissolved on May 6, 2011, following an inspection report by the National Bank for Agriculture and Rural Development (Nabard) rebuking the bank — a powerhouse of state politics — for dissolving security norms among other things. It has since been under administrator’s rule. 

The inquiry, instituted by the Congress-led state cooperation department, is set to create ripples in the political circuit, particularly for the NCP, as a majority of the bank’s directors were from the party and are likely be called in for questioning along with others.

It is almost an alarm bell for the party, considering the rumours of the possibility of an early general election. The inquiry by the cooperation department headed by Congress minister Harshwardhan Patil will be conducted by the joint registrar of cooperatives.

“It’s a fact-finding inquiry under section 83 of the Maharashtra Co-operative Societies Act,” Patil said. Asked whether the directors will be held responsible, he said, “Let the inquiry report come in.”

The inquiry officer has the power to summon the then board members to explain their role in the decisions that led to the massive losses, and answer to 11 other charges including unnecessary expenditure, loan disbursal, debts, sale of sugar cooperative units and so on. The probe report will be crucial to set in motion another inquiry under section 88 of the act.

According to a Congress minister, the inquiry hardly comes as a surprise since the Reserve Bank of India had earlier given warning signals to the state government pointing to the loss-making entity’s mismanagement. It had also ordered action against the bank. It took the government one-and-a-half years to start the probe.

Past board members
The politically powerful board of directors of the MSCB was dissolved on May 6, 2011, with the chief minister’s assent.

The board consisted of Deputy Chief Minister Ajit Pawar, MPs Anandrao Adsul (Shiv Sena) and Ishwarlal Jain (NCP), MLAs Diliprao Deshmukh and Vijay Wadettiwar (both from the Congress), Rahul Mote (NCP), Manikrao Kokate (Congress), Chandrashekhar Ghule-Patil (NCP), Dilip Sopal (Independent), Ramprasad Kadam-Bordikar (Congress), Jayant Patil and Meenakshi Patil (both from PWP), Vijaysinh Mohite-Patil (MLC and former deputy CM), Pandurang Phundkar (BJP) and others. Congress minister Madhukarrao Chavan and NCP minister Hasan Mushrif were the directors of the bank till 2010. 

 

Stats Facts
>> Net worth of MSCB: Rs 25,724 crore
>> Deposits: Rs 15,862 crore
>> Loans: Rs 10,285 crore
>> Staff strength: 1,728
>> Total income of the bank: Rs 1,870 crore

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